It depends. (Of course that’s what lawyers would say.)
Adjudication is a construction industry specific form of dispute resolution. It was introduced by the Housing Grants, Construction and Regeneration Act 1996 (the Construction Act), to those in the know). If you have a construction contract, as defined in the Construction Act, that contract must include a right to refer disputes to adjudication. If it doesn’t, the right will be implied in (and there is no way to avoid that).
So in one sense, yes, you may have to adjudicate – if you have a construction contract and the other party refers a dispute to adjudication. Provided they have referred the dispute and got an adjudicator appointed properly (which isn’t always a given, so it’s worth checking), no matter how much you might not like it, you will have to adjudicate. If you refuse to participate in an adjudication, the adjudication may proceed anyway and you may end up with an adverse and enforceable decision against you.
However, there are two obvious cases where you wouldn’t have to adjudicate:
- First, where you don’t have a construction contract as defined in the Construction Act. In these cases, there is no requirement to provide for adjudication and no implied right to adjudicate where there is no express right. Unless there is an express right to adjudicate – which some non-construction contracts to have, so be careful – an offer to adjudicate can be rejected and an attempt to adjudicate rebuffed. Whether you have a construction contract is a technical question – and one we’ve written about – but if it sounds like a construction contract it probably is (and sometimes it is even if it doesn’t sound like one too).
- Second, even where there is a right to adjudicate, if you’re the party looking to progress a dispute, you don’t always have to adjudicate. In contracts where the right to adjudicate is implied in through the Construction Act, adjudication is an option – but not a necessity. As such, you can consider adjudicating, but if you’d rather go down another route you can. Some contracts – such as most standard form NEC contracts – do require you to adjudicate before going to court or arbitration, so check your contract.
The framing of the question – do I have to adjudicate? – might seem like you’d be wise to try and get out of it if you can. That’s not necessarily the case. Although it has its problems, adjudication can be a sensible, cost efficient and fast method of dispute resolution – and its widespread acceptance by the construction industry over 20+ years is no coincidence.
We are experts in adjudication – it’s what we do day in, day out. If you have any queries on adjudication, drop us a line.
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