Construction law and dispute resolution

Abstract

Natural justice requires the right to a fair hearing and the absence of bias in the person making a decision. Construction adjudication was introduced for the benefit of the UK construction industry as a mechanism for settling disputes quickly and cheaply on a temporary basis, pending final determination by arbitration, litigation or by agreement. The tension which exists between the requirements of natural justice and those of adjudication may be seen in the number of challenges to adjudicator’s decisions coming before the courts on grounds of natural justice. This research seeks the views of industry on the extent to which principles of natural justice should be applied in construction adjudication. Recent developments in case law concerning adjudication challenges are reviewed in order to understand whether the position has changed since the second edition of Coulson on Adjudication, a leading authority on natural justice in adjudication at the time of publication in March 2011. Case law over a ten year period is analysed to identify trends in the number and nature of the challenges and decisions. Views from industry are obtained using an online questionnaire to understand the level of awareness in natural justice issues and whether developments have had an effect on industry confidence. The findings reveal that although the number of adjudication referrals have reduced, the number of natural justice challenges have increased, and so has the proportion of successful challenges over the period from 2011. Industry however generally embraces the increased intervention and rigour by the courts and considers the right balance has been struck in the application of the principles of natural justice in construction adjudication. The number of natural justice challenges will be reduced by implementing the recommendations of clear court guidance, heightened awareness of the parties and better training of adjudicators to avoid silly mistakes.