International Contractual and Statutory Adjudication

Andrew Burr

• Publisher: Informa Law from Routledge
• Year: 2017
• eBook ISBN: 9781315294513
• Edition: 1
• Topic: Law
• Subtopic: Alternative Dispute Resolution
• Index: Law

A compilation of commentaries on the various jurisdictions where there either is, or is planned, a statutory adjudication system, this is a review of such systems worldwide in the commercial and construction fields. It features analysis by specialist advisory editors on the adjudication system in place in each separate jurisdiction, together with a copy of the relevant local legislation, and permits a comparative approach between each.

This book addresses statutory adjudication in a way that is practically useful and academically rigorous. As such, it remains an essential reference for any lawyer, project manager, contractor or academic involved with the commercial and construction fields.

Chapter 1
Introduction and organisation

Introduction

The United Kingdom

Australia: The East and West Coast models

Other Commonwealth jurisdictions

Civil law and mixed jurisdictions

Contractual régimes and published rules

Introduction

“‘Where shall I begin, please your Majesty?’ he asked. ‘Begin at the beginning,’ the King said, gravely, and go on till you come to the end: then stop”¹

1.1 It has felt a little like herding cats trying to find some coherent means of bringing together the incredibly diverse adjudication régimes covered in this publication. In the final analysis, the great “scheme of things” seems, most logically, to be to adopt the following broad approach:

1. The United Kingdom (by way of comparator);
2. Australia: the East and West Coast models;
3. Other Commonwealth jurisdictions;
4. Civil law and other jurisdictions;
5. Contractual régimes and published rules.

The United Kingdom

1.2 The genesis of contractual adjudication in the United Kingdom came in the “green” and “blue” standard forms of sub-contract, for use where the sub-contractor was “nominated” (or not) by the employer’s architect under the 1993 edition of the standard form of building contract issued by the Joint Contracts Tribunal (JCT). The green and blue standard forms were issued under the sanction of and approved by the National Federation of Building Trades Employers (NFBTE) and the Federation of Associations of Specialists and Sub-Contractors (FASS) and approved by the Committee of Associations of Specialist Engineering Contractors (CASEC).

1.3 The green form (for nominated sub-contractors) was originally issued in 1963 and was revised in April 1978 to include clause 13B, as follows (under the side heading “Contractor’s claims not agreed by the Sub-Contractor – appointment of Adjudicator”):

“(1)(a) If the Sub-Contractor, at the date of the written notice of the Contractor issued under Clause 13A (2)(c) of the Sub-Contract, does not agree the amount (or any part thereof) specified in that notice which the Contractor intends to set-off, the Subcontractor by registered post or recorded delivery a written statement setting out the reasons for such inability to agree and particulars of any counterclaim against the Contractor arising out of this Sub-Contractor considers he is entitled, provided always that he shall have quantified such counterclaim against the Contractor arising out of this Sub-Contract to which the Sub-Contractor considers he is entitled, provided always that he shall have quantified such counterclaim in detail and with reasonable accuracy (which statement and counterclaim, if any, shall not however be binding insofar as the Sub-Contractor may amend it in preparing his pleadings for the Arbitration pursuant to the notice of arbitration referred to in sub-paragraph (i) of this paragraph) and shall at the same time

• (i) give notice of arbitration to the contractor; and
• (ii) request action by an adjudicator in accordance with the right given in paragraph (b) hereof (and immediately inform the contractor of such request) and send by registered post or recorded delivery a copy of the aforesaid statement and the written notice of the contractor to which that statement relates and the aforesaid counterclaim (if any).

(b) Subject to the provisions of the clause and the clauses 11(b) and 13A of the sub-contract shall be entitled to request the person named as the adjudicator in Part XIII of the Appendix to the sub-contract (hereinafter called ‘the adjudicator’) to act as the adjudicator to decide those matters referable to the adjudicator under the provisions of this clause. In the event of such person being unable or unwilling to act as the adjudicator a person appointed by him shall be the adjudicator in his place. Provided that no adjudicator shall be appointed who has any interest in this sub-contract or the main contract of which this sub-contract is part or in other contracts or sub-contracts in which the contractor or the sub-contractor is engaged.

(2) Upon receipt of the aforesaid statement the contractor may within fourteen days from the date of such receipt send to the Adjudicator by registered post or recorded delivery a written statement with a copy to the sub-contractor setting out brief particulars of his defence to any counterclaim by the sub-contractor.

(3)(a) Within seven days of receipt of any written statement by the contractor under sub-clause (2) hereof or on the expiry of the time limit to the Contractor referred to in sub-clause (2) hereof, whichever is the earlier, the adjudicator, without requiring any further statements than those submitted to him under sub-clause (1) and where relevant sub-clause (2) hereof (save only such further written statements as may appear to the adjudicator to be necessary to clarify or explain any ambiguity in the written statements of either the contractor or the sub-contractor) and without hearing the contractor or sub-contractor in person, shall, subject to paragraph (b) hereof, in his absolute discretion and without giving reasons decide in respect of the amount notified by the contractor under clause 13A(2)(b) of this sub-contract:

1. whether the whole or any part of such amount shall be retained by the contractor; or
2. whether the whole or any part of such shall be deposited, for security pending arbitration, by the contractor with the Trustee-Stakeholder referred to sub-clause (5) hereof; or
3. whether the whole or any part of such amount shall be paid by the contractor to the sub-contractor.

The adjudicator’s decision shall be binding upon the contractor and the sub-contractor until the matters upon which he has given his decision have been settled by agreement or determined by an arbitrator or the courts.

(b) The adjudicator shall reach such decision under paragraph (a) hereof as he considers in all the circumstances of the dispute to be fair, reasonable and necessary, and such decision shall deal with the whole amount set-off by the Contractor under clause 13A(2) of this sub-contract.

(c) The adjudicator shall immediately notify in writing the contractor and the sub-contractor of his decision under paragraph (a) hereof.

(4)(a) Where any decision of the adjudicator notified under sub-clause (3)(c) hereof requires the contractor to deposit an amount with the Trustee-Stakeholder referred to in sub-clause (5) hereof, the contractor shall thereupon pay such amount to the payee hereinafter expressed provided that the contractor shall not be obliged to pay a sum greater than the amount due from the contractor under clause 11(b) of this sub-contract in respect of which the contractor has exercised the right of set-off referred to in clause 13A(2) of this sub-contract.

(b) Where any decision of the Adjudicator notified under sub-clause (3)(c) hereof requires the contractor to pay an amount to the sub-contractor to pay an amount to the sub-contractor, such amount shall be paid by the contractor immediately upon receipt of the decision of the adjudicator but subject to the same proviso as set out in paragraph (a) hereof.

(5) The payee named in Part XIII of the appendix to this sub-contract (in this sub-contract called ‘the Trustee-Stakeholder’) shall hold any sum received under the provisions of sub-clauses (3) and (4) hereof in trust for the contractor and sub-contractor until such time as:

• the arbitrator appointed pursuant to the notice of arbitration given by the sub-contractor under sub-clause (1)(a)(i) hereof; or
• the contractor and the sub-contractor in a joint letter signed by each of them or on their behalf

shall otherwise direct and shall, in either of the above cases, dispose of the said sums as may be directed by the arbitrator, or, failing any direction by the arbitrator, as the contractor and sub-contractor shall jointly determine. The Trustee-Stakeholder shall deposit the sum received in a Deposit Account in the name of the Trustee-Stakeholder but shall add the interest to the sum deposited. The Trustee-Stakeholder shall be entitled to deduct his reasonable and proper charges from the sum deposited (including any interest added thereto). The sub-contractor shall notify the Trustee-Stakeholder of the name and address of the Adjudicator and arbitrator referred to above.

(6) The arbitrator appointed pursuant to such Notice of Arbitration may in his absolute discretion at any time before his final award on the application of either party vary or cancel the decision of the adjudicator given under sub-clause (3) hereof if it appears just and reasonable to him so to do.

(7) Any action taken by the contractor under clause 13A(2) of this sub-contract and by the sub-contract in respect of any counterclaim under sub-clause (1)(a) hereof is without prejudice to similar action by the contractor or sub-contractor as the case may be if and when further sums become due to the sub-contractor.

(8) The Fee of the adjudicator shall be paid by the sub-contractor within 28 days of the date of the decision of the adjudicator given under sub-clause (3) hereof but the arbitrator appointed pursuant to the notice of arbitration under sub-clause (1)(a)(i) hereof shall in his final award settle the responsibility of the contractor or sub-contractor or both payment of the fee or any part thereof and where relevant for the charges of the Trustee-Stakeholder or any part thereof.”

1.4 Subject to clause numbering changes, the blue form (for non-nominated sub-contractors) contained an identical provision, in clause 16 thereof.

1.5 The 1980 edition of the JCT standard form of Nominated Sub-Contract NSC/4a contained the following revised version of clause 13B (above) in clause 24, as follows:

“Contractor’s claims not agreed by the sub-contractor – appointment of adjudicator

1. If the sub-contractor at the date of the written notice of the contractor issued under clause 23.2.3, disagrees the amount thereof specified in that notice which the contractor intends to set off, the sub-contractor may, within 14 days of receipt by him or such notice, send to the contractor by registered post or recorded delivery a written statement setting out the reasons for such disagreement and particulars of any counterclaim against the contractor arising out of the sub-contract to which the sub-contractor considers he is entitled, provided always that he shall have quantified such counterclaim in detail and with reasonable accuracy (which statement and counterclaim if any, shall however be binding insofar as the sub-contractor may amend it in preparing his pleadings for any arbitration pursuant to the notice of arbitration referred to in clause 24.1.1.1) and shall at the same time:
   • .1.1. give notice of arbitration to the contractor; and
   • .1.2. request action by the adjudicator in accordance with the right given in clause 24.1.2 (and immediately inform the contractor of such request) and send to the adjudicator by registered post or recorded delivery a copy of the aforesaid statement and the written notice of the contractor to which that statement relates and the aforesaid counterclaim (if any)
2. Subject to the provisions of the clause 24 and of clauses 21.3 and 23 the sub-contractor shall be entitled to request the adjudicator named in the Tender, Schedule 2, item 6 to act as the adjudicator to decide those matters referable to the adjudicator under the provisions of clause 24. In the event of the above-named being unable or unwilling to act as the adjudicator a person appointed by the above-named shall be the adjudicator in his place. Provided that no person shall act as the adjudicator who has any interest in the sub-contract or the main contract of which the sub-contract is part or in other contracts or sub-contracts in which the contractor or sub-contractor is engaged unless the contractor, sub-contractor and the adjudicator so interested otherwise agree in writing within a reasonable time of the adjudicator’s interest becoming apparent.

Upon receipt of the aforesaid statement the Contractor may within 14 days from the date of such receipt send to the adjudicator by registered post or recorded delivery ...

Table of contents

• Cover
• Half Title
• Title
• Copyright
• CONTENTS
• Foreword
• Preface
• Acknowledgments
• Editorial team biographies
• Table of acronyms
• Table of case report references
• Table of cases
• Table of legislation
• Table of contract clauses and rules
• List of primary appendices
• Online resources
• List of secondary appendices
• CHAPTER 1 INTRODUCTION AND ORGANISATION
• CHAPTER 2 ENGLAND AND WALES
• CHAPTER 3 AUSTRALIA: THE EAST COAST MODEL (WITH NEW SOUTH WALES AS THE PRINCIPAL LEGISLATION)
• CHAPTER 4 AUSTRALIA: THE EAST COAST MODEL (VICTORIA, TASMANIA, THE AUSTRALIAN CAPITAL TERRITORY AND SOUTH AUSTRALIA)
• CHAPTER 5 AUSTRALIA: THE EAST COAST MODEL (QUEENSLAND)
• CHAPTER 6 AUSTRALIA: THE WEST COAST MODEL
• CHAPTER 7 CHARTERED INSTITUTE OF ARBITRATORS’ DISPUTE BOARD RULES
• CHAPTER 8 FÉDÉRATION INTERNATIONAL DES INGÉNIEURS-CONSEILS (FIDIC) DISPUTE BOARD RULES
• CHAPTER 9 GERMANY
• CHAPTER 10 HONG KONG
• CHAPTER 11 INTERNATIONAL CHAMBER OF COMMERCE DISPUTE BOARD RULES
• CHAPTER 12 IRELAND
• CHAPTER 13 MALAYSIA
• CHAPTER 14 MAURITIUS
• CHAPTER 15 NEW ZEALAND
• CHAPTER 16 NORTHERN IRELAND
• CHAPTER 17 SCOTLAND
• CHAPTER 18 SINGAPORE
• CHAPTER 19 SOUTH AFRICA
• CHAPTER 20 UNITED STATES OF AMERICA
• APPENDIX A THE UK HOUSING GRANTS, CONSTRUCTION AND REGENERATION ACT 1996 (AS AMENDED) AND ITS AUSTRALIAN EQUIVALENTS
• APPENDIX B THE UK HOUSING GRANTS, CONSTRUCTION AND REGENERATION ACT 1996 (AS AMENDED) AND ITS OTHER INTERNATIONAL EQUIVALENTS
• APPENDIX C THE SCHEME FOR CONSTRUCTION CONTRACTS (ENGLAND AND WALES) REGULATIONS 1998 (AS AMENDED) AND ITS AUSTRALIAN EQUIVALENTS
• APPENDIX D THE SCHEME FOR CONSTRUCTION CONTRACTS (ENGLAND AND WALES) REGULATIONS 1998 (AS AMENDED) AND ITS OTHER INTERNATIONAL EQUIVALENTS
• Index