We speak to expert adjudicator Janey Milligan about how construction adjudication has evolved.
Some 18 years ago now, The Housing Grants, Construction and Regeneration Act 1996 (“the Act”) introduced a statutory right for parties to a construction contract to refer their disputes to adjudication. The Act sought to implement the recommendations from the 1994 Latham report, pursuing a faster and less costly way of resolving construction disputes. An industry of legal specialists, consultants and adjudicators has developed and increasingly those within the industry will not recall a time when adjudication was not available “at any time”. Critical to the success of adjudication was the role of the adjudicator, now firmly established within the industry.
Reflecting on these advances (and the changes brought about the Local Democracy, Economic Development and Construction Act 2009), Coral Riddell spoke with established adjudicator, Janey Milligan, to seek her views on the development and current thoughts in relation to construction adjudication.
What made you want to become an adjudicator?
When I worked in private practice as a Chartered Quantity Surveyor I was always interested in the contracts and claims side of the business. In 1993 I took up a post lecturing at Glasgow Caledonian University and was particularly involved with the Construction Law and Contracts Modules. Around that time the Housing Grants Construction & Regeneration Act was in the process of going through consultation and I became interested in the possibility of adjudication as an alternative method of dispute resolution in the construction industry. After a few years of lecturing I wanted to get back into industry in any event and saw the opportunity of opening my own practice in dealing with construction disputes. As a result, I started Construction Dispute Resolution (CDR) in January 1997 and trained as an adjudicator.
What are the key changes or developments, if any, that you have experienced in relation to how parties run an adjudication over the years?
As far as I am concerned the biggest change and development in adjudication since I started is that it has become a very legalistic process, often mirroring Court and arbitration proceedings which I don’t think was originally intended. In my very first adjudication I went to one Party’s office and interviewed all of the relevant members of staff and management, and then I visited the other Party’s premises and interviewed people there quite separately without the other Party being in attendance - something that would not be possible today.
Secondly, I think the process has become very strategic and the crafting of the Notice of Adjudication and the questions that are put to the adjudicator can be a very particular skill. There are more and more adjudications these days that are on specific, narrow points rather than the disputes that were previously termed as “kitchen sink disputes” which was really a final account which had everything in it from variations to delays, loss and expense, liquidated damages and contra charges, all in one adjudication. Often Parties will refer such a narrow dispute to ‘test the waters’ and to get an idea of the strength of their position. Alternatively, a Decision on a narrow point may be used as a negotiating tool and assist the Parties in settling their dispute without the expense of running an “all-in” adjudication. However, this can cause problems with jurisdiction and ensuring the adjudicator does not exceed the limited scope of jurisdiction as determined by the Notice.
Are jurisdictional challenges increasingly common or is this something you are beginning to see less of?
In my view jurisdiction challenges are submitted perhaps less so than they used to be. However, it is still fairly common to have one Party try and at least run some sort of challenge to have a negotiating strand if the Decision goes against them. In reality, of over 250 adjudications where I have been adjudicator I have resigned less than half a dozen times due to not having jurisdiction. In addition, for all the adjudications where I have had jurisdiction challenges I am not aware of any that have been reviewed in the Courts and it has been determined that I did not have jurisdiction.
The scope of construction disputes seems to have extended well beyond simple payment disputes to include professional negligence, multi -party and complex technical disputes. Do you consider adjudication to be an effective mechanism for such matters and to what extent to you deal with matters that are not related to payment?
I certainly consider adjudication as an effective mechanism for all matters beyond simple payment disputes. I appreciate that sometimes they can be very complicated when you get issues of professional negligence or complex technical disputes but it appears to me that the whole legal and representation industry has improved in its approach to adjudication, works to a much tighter timeframe, and can be much more articulate in presenting their claim because time is limited. This allows the adjudicator to get to the crux of the matter very quickly and deal with it effectively and efficiently. In fairness I think it is worth pointing out that a lot of the times when there are complex disputes, more often than not the Parties are legally represented and these representatives see the benefit in extending the adjudication process beyond the normal 28-42 days to ensure that the adjudicator can deal with the matter appropriately.
The low representation of woman on nominating body lists has been highlighted recently with, for example, women accounting for only 6% on the CIARB list and only 8% on the RIBA list. Do you think that gender parity is something that should now be encouraged among nominator bodies to better reflect changes in industry?
I have always been and remain very keen to see more women in the construction industry and I have tried to encourage women into the industry as much as possible. It is disappointing there are not as many women in the industry as there should be and it is disappointing that the representation of women on nominating body lists is usually a very small percentage. However, I do not necessary believe that gender parity is something that should be encouraged among nominating bodies to better reflect changes in industry. The important thing is to get the right people on to the nominating body list that are keen to be adjudicators, are qualified, trained and sufficiently skilled to be adjudicators and whether these are men or women is, in my view, immaterial. It is all about getting the right person with the appropriate skill set to the job.
What are the things that parties do that most frustrates/hinders effective progress in an adjudication?
Some Parties fail to properly cross-reference their arguments to the submissions of the other Party and often just throw in a whole pile of documents and expect the Adjudicator to sort it out! Typically I ask Parties to follow the same paragraph numbering in the Response as in the Referral for ease of referencing, however Parties do not always do so. This leads on to my next point – Parties failing to comply with directions of the Adjudicator directly hinders the process and often results in additional time and cost being incurred dealing with unnecessary additional submissions and the like.
What examples of best practice would you encourage parties to adopt in an adjudication in terms of process and in their dealings with the adjudicator?
Everyone should be professional at all times. I fully understand and appreciate that dispute resolution can be stressful for the Parties involved, and there can be large sums of money at stake, however this cannot excuse unprofessional behaviour. This is particularly relevant at hearings – Parties that remain calm and reasoned and allow the other side their opportunity to put their point across without unnecessary or repeated interruption come across much better. As above, I would always ask Parties to cross reference their submissions to those of the other side, and I would encourage Parties to adopt this as best practice even if the adjudicator does not explicitly ask – making your case as easy to follow as possible, with reference to appropriate supporting documentation clearly sign-posted in the main submission document can result in less time being expended by the adjudicator in trying to make sense of your case, therefore avoiding an unnecessarily high bill for the adjudicator’s fees and expenses.