The raft of adjudication schemes we all have to contend with
Adjudication was supposed to be quick, cheap and simple dispute resolution for the construction industry. It is perhaps surprising, therefore, that during the phoney war between the passing of the Housing Grants Construction & Regeneration Act in 1996 and the approval of the Scheme for Construction Contracts in 1998, various industry bodies set about devising a plethora of adjudication schemes to vie with the default provisions proposed by the government.
Before the wrapper was even off the adjudication box, therefore, the expectant industry was bombarded with wannabe adjudication rules from the ICE, the Construction Industry Council, the Centre for Dispute Resolution and the Official Referees Solicitors Association (now TeCSA), to name but a few.
Despite the merits of these rivals for the hearts of potential disputants being enthusiastically extolled by their sponsors, in the main, those who actually appreciated that they had a choice, tended to opt for the government's scheme anyway, applying the 'nobody ever got the sack for choosing IBM' thinking to a product that was untested, had no brand image and was not a market leader.
Four years down the line we need no reminding that adjudication is, indeed, quick - impossibly so for some cases, such that even the processes, greatest fans suggest that the 28-day deadline is a little on the tight side. And there is no need even to mention the fact that whatever adjudication may be, it is far from cheap.
Producing detailed, well-argued, fully supported cases to impossibly short order means that people with experience of construction disputes have to burn the midnight oil, and that never comes cheap. Whether it is simple or not depends on your perspective. In the majority of cases, adjudication is a successful route to getting an answer, albeit a costly one.
If there is a hiccup in the process, however, such as a jurisdictional issue, an adjudicator who does not fully appreciate the limits of his or her powers, or a party who takes part willingly enough but comes up with some clever reason why they should not be bound by the outcome, unravelling the muddle can be far from straightforward. The resulting body of jurisprudence has provided ample material for this column.
Ironically, it has been said that the more frequent hiccups can be avoided if the parties adopt an adjudication procedure that anticipates and provides for these problems in advance. The schemes that were devised later in the day had the advantage, since they were able to learn from the experience of seeing the adjudication process at work. Here, the specialist bar association adjudication rules (TECBAR) take the biscuit.
Drafted by barristers, so long after adjudication had taken off that most believed that any new procedure would have completely missed the boat, the TECBAR rules carefully spell out most of the pitfalls of adjudication and provide practical and sound ways around them. Furthermore, by incorporating the TECBAR rules into your contract, you may end up with a barrister adjudicator at a startlingly cheap rate. Nevertheless, it has to be said that the TECBAR rules are not widely used and very few barristers have had to sell out in the name of Alternative Dispute Resolution (ADR).
The adjudication rules proposed by the Technology and Construction Courts solicitors association, TeCSA, are another matter, and have been widely incorporated into contracts. Particularly, as is often the case, contracts put together by its members. It is a sign of the success of the rules, that a new version has recently been issued following a period of consultation and feedback.
The TeCSA rules now include the controversial provision that where it is impossible for adjudicators to reach a concluded view on the parties' legal entitlements within the practical constraints of the process, they may give a 'fair and reasonable view' of how the dispute should lie.
Under the rules, the adjudicator is able to award costs to the successful party, if both parties agree. They also provide for a daily cap on adjudicators' fees, now increased to £1,250. TeCSA adjudicators span the construction disciplines and even include the odd barrister. The new TeCSA rules are available on www. tecsa. org. uk