Construction Law

Julian Bailey

Document

CHAPTER 24 STATUTORY ADJUDICATION

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Introduction

24.01 The 1990s saw the enactment of legislation in the United Kingdom,1 which was then followed by similar legislation in Australia,2 New Zealand,3 Singapore,4 the Isle of Man,5 Malaysia6 and Ireland7 (but not, as yet, in Hong Kong)8 that to a large

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extent removes from contracting parties the freedom they would otherwise have to agree upon their respective rights and obligations in relation to a construction project, and imposes upon them a regime of rights and obligations that they cannot bargain away. The legislation represents the most radical statutory intervention ever made in the operation of construction contracts. The broad purpose of this legislation is to improve the cash flow of those who perform construction work.9 One of the means by which this legislation attempts to improve cash flow in the construction industry is through the creation of a statutory right to periodic or interim payments that accrues to persons who perform construction work. The statutory provisions concerned with rights to payment were considered in Chapter 6. The statutory payment provisions are complemented by provisions concerning statutory adjudication, which are discussed in this chapter. Statutory adjudication is intended to operate as a fast-track form of dispute resolution10 that gives parties to a construction contract a quick and provisionally binding decision as to their rights and obligations, so as to ensure that if there is a dispute over a person’s entitlement to payment under a construction contract, that dispute can be resolved speedily by adjudication, and any decision of the adjudicator that is favourable to the person who performed the work in question may be relied upon by that person as a basis for seeking payment of the amount determined by the adjudicator to be due.

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