A notice of adjudication has landed and I have days to answer it
A notice of adjudication or a letter of claim has landed, the timetable is brutal, and I need a defence built now.
Updated: . By Jack Butler-Kettle, Construction Claims Consultant.
What's happening?
Your main contractor has started a formal process against you. It might be a notice of adjudication, the letter that starts an adjudication: a fast decision by an independent adjudicator. The referral notice, which sets out the claim in full, usually follows within 7 days. It might be a court document, or a letter of claim, the formal warning sent before court. Each comes with its own deadlines and duties. Treat them all alike and you can miss the directions that govern your response, or who is meant to send it.
The dispute may turn on Payment Notices, Pay Less Notices, valuation or what the subcontract means. It may also turn on whether the adjudicator can decide it at all, or on time limits for claims. With days to answer, the receipt, the subcontract, the calculations and the correspondence all need keeping safe. Good evidence still does not guarantee a defence or a result.
Keep the procedure separate from the money side. Your solicitor or representative should run the response, and the figures and evidence are built to fit the directions and the time available.
The solution
Write down what the document is, when it arrived, who sent it, the directions, the deadline for your response and the figures in dispute. Then gather the subcontract, notices, applications, valuations and proof of how and when each was sent into one indexed bundle.
Counterclaim Defence fixes the timetable first. It then tests every head and builds the money side of the response for whoever is running it for you. That includes a Scott schedule setting their figures beside yours. It works to the directions. It cannot delay the timetable, predict the decision or replace your legal representative.
Example
Illustrative example. The scenario and figures are invented.
The facts
A subcontractor submits its £380,000 final account. On a Tuesday, its main contractor refers a £142,000 counterclaim for delay costs and defects to adjudication, with a direction to respond in 7 days. The money side has to run alongside the representative's response.
What happens
- The documents are indexed the same day: the subcontract and its amendments, and every application and notice for the job with proof it was sent. The valuations, the payment record and the letters about the alleged delay and defects go in too.
- The referral is read for what has actually been referred, which is the counterclaim, not the account.
- The main contractor's figure is rebuilt line by line against the records, which support £96,000. The main contractor's own progress records put another trade in the area during the weeks behind £31,000 of the delay costs. A further £15,000 of defects is claimed twice.
- The figures and the Scott schedule go to the subcontractor's representative with the reconciliation attached, and the response goes in on day 7.
The referral in figures
| Item | Amount |
|---|---|
| Referred | £142,000 |
| Delay costs for weeks another trade held the area | £31,000 |
| Defects claimed twice | £15,000 |
| Supported by the records | £96,000 |
| Adjudicator's decision | £101,000 |
| Difference between the referral and the decision | £41,000 |
The outcome
The adjudicator's decision is for £101,000. The £41,000 difference between the referral and the decision is the value of the records.