Construction disputes can be referred to adjudication at any time, writes Kim Franklin. Thus, the 28-day decision man (or woman) can be called on at any time up to practical completion, at any time up to the issue of the final certificate and at any time thereafter. Those who thought adjudication was to be a quick fix for wrangles that brewed up during the course of a construction project were surprised to find that adjudications could be commenced long after the project was completed, paid for and occupied.
No one was more surprised, it turns out, than Sir Michael Latham, who first introduced the notion of adjudication for the resolution of construction disputes in his 1994 report into construction procedures, 'Constructing the Team'.
It transpired that he was not consulted when the Construction Act was drafted. The right to refer a construction dispute 'at any time' is now enshrined in the Act and, what is more, there are no plans to change it. The government-led review of the workings of the Act may address many problems thrown up by nearly a decade of adjudications, but adjudicating post-completion disputes, including final-account claims and allegations of professional negligence, is not one of them. So, while nothing is certain on the choppy waters of the political process, particularly in the shadow of a general election, it seems highly likely that parties to construction contracts will retain the right to refer their disputes to adjudication at any time.
If there is no limit to when a dispute can be referred, is there a limit to the number of times the same or similar disputes can be referred?
This point was considered recently in the case of Emcor Drake & Scull v Costain Skanska Joint Venture (judgment 29.10.04). The defendant consortium was the main contractor for the refurbishment of the Great Western Royal Hotel at Paddington in London. Emcor was engaged as the electrical sub-contractor.
The claimant said it was delayed in the execution of its works and submitted three claims for extensions of time in November 2001, April 2003 and February 2004. The later claims relied on events and material from the earlier claims.
The November 2001 claim was referred to adjudication. Emcor relied on delay caused to works to the hotel bedrooms as a result of problems with access. Emcor did not produce a critical-path analysis. Furthermore, it argued that, if it was denied access to the bedrooms, it followed that it was entitled to the extension claimed. The adjudicator found that Emcor had failed to discharge the burden of proving it was entitled to any extension of time.
Subsequently, Emcor referred the February 2004 claim to a different adjudicator. The second adjudicator approached the problems of the bedrooms in a different way and found that Emcor was entitled to an extension of time up to the date of practical completion and repayment of some £200,000 of liquidated damages.
Costain Skanska challenged the second decision in court on the following grounds:
. There could only be one extension of time under the contract, so there could only be one adjudication on the point.
. The first adjudicator had found that Emcor was not entitled to an extension of time. The second adjudicator was bound by that decision.
. Alternatively, the second adjudicator could only consider events relevant to the later applications, but not the November 2001 application.
. Emcor relied on the same facts, material and documentation in both adjudications. It was an abuse of the process to require the defendants to respond to it twice.
The judge rejected each argument. He agreed a second adjudicator should respect the decision on a point found in an earlier adjudication.
He found, however, that the first adjudicator had not decided that Emcor was not entitled to an extension of time. He had simply found that it had failed to prove that it was. Thus, the second adjudicator had jurisdiction to revisit all matters relied upon by Emcor and to grant an extension, and the decision was enforceable.
So it seems that a dispute can be referred to adjudication at any time, and then be referred time and time again thereafter.
Kim Franklin is a barrister and chartered arbitrator at Crown Office Chambers. Visit www.