Construction process to come under review

Several organisations are reviewing the legislation governing construction adjudications at the same time as other bodies are looking at adopting those procedures.

An inquiry initiated by former Government minister Nick Raynsford into the Housing Grants Construction and Regeneration Act 1996 has recently been transferred to the Construction Industry Council.
The main area of concern, highlighted by civil engineer and expert witness Guy Coolam at a recent technology and construction bar association meeting, is that of parties amending contracts so that referring parties pay the legal costs of both sides in an adjudication.
One construction lawyer pointed to other concerns: “The referring party can take a long time to make a claim, while
respondents have a short time to fit within the 28-day deadline of an adjudication. The referring party should be able to extend time for a decision.”
Other problems are that the applicant can make a claim and subsequently keep introducing new ones, and there is no right for the adjudicator to award costs under the scheme.
However, Coolam said: “The truth is that the adjudications have been outstandingly successful. Only 20 haven't been enforced out of 4,500.”
There are suggestions that the act's provisions may be adopted in other UK industries, including medical disputes and landlord and tenant leases.
Raynsford sent letters to the construction industry to say that he was considering amending the adjudication scheme, but that it was a bit premature to amend the act.
According to Coolam, while the number of adjudications remains steady, there has been a drop by about a third in the number of construction arbitrations. “We have a very good indicator, as a large number of arbitrators are appointed by nominated bodies, and this is what they're reporting,” he said.