The precarious state of housebuilding and the appointment of administrators by developer City Lofts has brought the issue of construction insolvency to the fore. There have been a number of important changes to insolvency law since the recession of the early nineties, but the way in which insolvency law interacts with the statutory right to adjudication is, in many respects, still unclear. The right to adjudicate has been a mandatory feature of all UK construction contracts since the Construction Act came into force on 1 May 1998. One of the cornerstones of the adjudication procedure is that a construction contract enables a party to give notice "at any time" of its intention to refer a dispute to adjudication. This feature of the Construction Act, however, does not sit comfortably with the case of A Straume (UK) vs Bradlor Developments, where the contractor (Bradlor) went into administration and its administrators commenced adjudication against the employer (Straume) for sums due. The employer served its own adjudication notice; this raised counterclaims that exceeded the contractor's claims. An issue arose as to whether the employer's adjudication could proceed in the light of the Insolvency Act, which says: "During the period for which an administration order is in force, no other proceedings may be commenced except with the consent of the administrator or court."
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