Do both parties have to agree to adjudication?
No, either party to a construction contract can refer a dispute to adjudication at any time, and the other side cannot opt out.
Updated: . By Jack Butler-Kettle, Construction Claims Consultant.
The answer
Section 108 of the Housing Grants, Construction and Regeneration Act 1996 gives each party to a construction contract that right. If the contract does not provide for adjudication, Part I of the Scheme for Construction Contracts (England and Wales) Regulations 1998 fills the gap. Your main contractor's consent is not needed. It cannot hold things up by refusing to take part, and the adjudicator can decide without its response. Two things do need checking before you serve a notice. First, there must be a real dispute: a claim that has been made and then rejected or ignored. Second, the Act must cover your contract. Some contracts with homeowners for work on their own home are excluded by section 106, along with a few other types. A contract outside the Act can still provide for adjudication by agreement, and many do.
Example
Illustrative example. The scenario and figures are invented.
The facts
A subcontractor is owed a notified sum of £29,000 that the main contractor has not paid. It wants to take the non-payment to adjudication without the main contractor's consent.
What happens
- The subcontractor writes to the main contractor about the unpaid £29,000.
- The main contractor refuses 4 days later.
- The subcontractor serves a notice of adjudication 3 days after the refusal.
- The main contractor replies that it does not agree to adjudication.
The outcome
The reply has no effect. The adjudicator is appointed and the timetable runs.
Late Payment Claim starts with whether the contract and the dispute are ready.
Sources
- Housing Grants, Construction and Regeneration Act 1996, s 108 (Right to refer disputes to adjudication). legislation.gov.uk.
- Scheme for Construction Contracts (England and Wales) Regulations 1998, SI 1998/649, Schedule, Part I (Adjudication). legislation.gov.uk.
- Housing Grants, Construction and Regeneration Act 1996, s 106 (Provisions not applicable to contract with residential occupier). legislation.gov.uk.