Legal Q&A: When to appoint an adjudicator

摘要

AS the COVID-19 crisis continues into 2021, the ever-present issue of maintaining cash flow in the contract and supply chain persists. Adjudication is a key tool for maintaining cash flow if a dispute over payment arises, allowing for a speedy decision within 28 days (subject to any extensions granted). Those who have been involved in adjudication will know it proceeds at a rapid pace and is subject to the strict procedures and rules set out in the Housing, Grants, Construction and Regeneration Act 1996, the Scheme for Construction Contracts (England and Wales) Regulations 1998 and the Scheme for Construction Contracts (Scotland) Regulations 1998. However, with minds focused on proceeding to adjudication and the issues of the case itself, it is often easy for the more mundane procedural aspects of adjudication to be overlooked. Yet parties ignoring or overlooking the applicable adjudication rules do so at their peril! The recent case of Lane End Developments Construction Ltd v Kingstone Civil Engineering Limited (2020) ewhc 2338 serves as a useful reminder of the importance of careful compliance with the applicable adjudication rules when seeking to commence adjudication proceedings. In Lane End, the High Court was asked to consider, amongst other things, whether an adjudicator had been validly appointed and had jurisdiction to issue his decision in the adjudication. Lane End was the main contractor on a housing development and Kingstone was subcontracted to carry out the enabling works. There was no express provision in the subcontract for disputes to be referred to adjudication. Therefore, any adjudication arising out of the subcontract was to be conducted in accordance with the provisions of the Scheme for Construction Contracts (England and Wales) Regulations 1998, as amended. As a result of Lane End's failure to timeously issue a payment notice, Kingstone referred the dispute on a smash-and-grab basis to adjudication.