17/03/2015
Welcome back. If you have been following our adjudication series you will know that we have covered the following topics surrounding this type of dispute resolution:
Continuing our series on adjudication we will now look at the process of How to Appoint an Adjudicator.
Disputes involving construction contracts can cost thousands of pounds in delays if the parties to the dispute end up in a deadlock situation. Therefore, it is crucial to appoint a property qualified, experienced individual to adjudicate any disagreement which may arise as a project progresses.
As with all elements of Adjudication, time is of the essence. This is highlighted by the fact that an adjudicator must be appointed within seven days of the notice of adjudication being issued. It is therefore advisable to take steps to appoint an adjudicator on the same day the notice of adjudication is served.
Ways to Appoint an Adjudicator
There are three methods in which an adjudicator can be appointed:
An individual is named as an adjudicator in the construction contract
As everyone knows, it is much easier to reach an agreement over a contentious issue at a time when there is no contention and animosity between the parties. Therefore, appointing an adjudicator when the construction agreement is negotiated can save a lot of time if a dispute does arise later down the line.
The disadvantage of naming an adjudicator in the contract is, due to the tight time frames required for the adjudication process, the nominated individual may not be available when required.
A specific nominating body is identified in the contract
This is a common way to have an adjudicator appointed. If the nominating body has been named in the contract, then this organisation must be used to appoint the adjudicator or they (the adjudicator) will lack jurisdiction.
Once the nominating body select an adjudicator, they (the nominated person) will have two working days in which to accept or decline the appointment.
No individual or nominating body is named in the contract
If no individual or nominating body is named on the contract then the Scheme provides that the party referring the notice of adjudication may request a nominating body to select an adjudicator. The appointment then follows the same procedure as if a specific nominating body had been identified in the contract.
How Will a Nominated Body Select an Adjudicator?
Giving regards to the importance of selecting an adjudicator who has the relevant experience to deal with the particular dispute in question, the notice of adjudication needs accompany application form. The body nominated by the parties (or the referring party if a nominating party has not been named in the contract) will then select the most appropriately qualified adjudicator, subject to their availability.
In the 2008 case of London Borough of Camden v Makers UK Limited [2008] EWHC 1836 (TCC) the Technology and Construction Court held that a party to an adjudication could, unless the contract stated otherwise, seek to ascertain if a particular adjudicator was available to act in a dispute and seek to persuade the nominating body to appoint that specific individual. However, the Court did state both parties to a dispute should seek to limit their unilateral contact with adjudicators and, if contact is made it should be done so in writing in order to provide a record if the communication is subsequently misconstrued.
Rejecting an Adjudicator Appointed by a Nominating Body
Can a party reject an adjudicator appointed to settle their dispute? This issue was considered in the case of Lanes v Galliford [2011] EWHC 1035, and the case appears to have identified a troublesome gap in the Housing Grants Construction and Regeneration Act 1996. The case involved the referring party being dissatisfied with the appointed adjudicator and refusing to provide the relevant information of their case within two days (as stated in the rules of the particular adjudication). They then sought to appoint another adjudicator. The respondent argued that the referring party had thrown out the adjudication agreement and sought an injunction to stop the referring party from seeking further adjudication. The Court held that a party could not repudiate an adjudication agreement under these circumstances because a party had a right to refer a dispute to adjudication at any time.
This gap in the Housing Grants Construction and Regeneration Act 1996 could technically result in the referring party rejecting the nominated adjudicator over and over again and simply repeat the nomination procedure until an individual agreeable to them is appointed. However, such behaviour is likely to be viewed by the courts as abuse of both statutory and contractual process.
List of Referring Bodies Bodies who can Nominate an Adjudicator include:
To find out more about appointing an adjudicator please phone our office on 0207 993 6960 or fill in our enquiry form.
Stay tuned for part Four in this series on adjudication where we discuss The Referral and Response.
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Fisher Scoggins Waters is a leading construction, engineering and manufacturing litigation firm, specialising in disputes and disasters. For further information on this article or any of our litigation services, please contact us on: +44 (0) 207 993 6960.