Adjudication Society Talk in Bristol
Chris Dancaster speaking on training of adjudicators and adjudicators' decisions at Laytons' Bristol office.
(It should be noted that this is not a verbatim record: the writer has paraphrased Chris Dancaster's talk and the questions and answers that followed. The purpose of this note is to give a general flavour of the issues that were discussed at the meeting.)
Nick Guppy (Laytons) began by introducing the speaker, Chris Dancaster. Chris has many years of experience as a Quantity Surveyor and in the field of dispute resolution.
I am going to start by talking about adjudication decisions. I have not acted as a party representative in an adjudication, but I have made decisions and seen the decisions that other people have made. The concept of adjudication is providing a decision and putting parties in a position to resolve their dispute. This happens if the decision written by the adjudicator makes sense.
I am a "reasonalist". I give reasons with my decisions unless I am asked not to. To me, it is axiomatic that an adjudicator will give reasons unless asked not to. As adjudicator, we ought to tell the parties how we got to our decision - it makes sense.
People are often concerned that a decision with reasons costs more than one without. If the adjudicator follows the decision making process through properly from beginning to end when reviewing the documents and each parties' case, he should have "reasons" for his decision: the whole process should have followed through in a logical order in his head. Reasons are not something that you cobble together at the end having made your decision.
You have to ask yourself, if the adjudicator has not followed through the whole decision making process from start to finish, is the decision safe?
It follows then that, bearing in mind that the adjudicator should have properly thought through his decision, the extra cost involved in giving reasons is only the cost of committing those reasons to paper. The adjudicator should have gone through the whole reasoning process in his head.
In December 2000 the CIB was asked to produce a Review of the Scheme for Construction Contracts for the construction minister. A couple of points from this.
The problem of the "ambush" tactic was raised. This is when a party produces large, even excessive, amounts of paper with the aim of ambushing their opposition. I think that this is not really a major problem though.
Another issue raised was that of "Natural Justice" and the confusion that this term can cause. Mr Justice Forbes has coined the phrase "procedural fairness" which I think is a much better term to use.
Guidance on specific issues raised in the CIB report is in the course of preparation by a new group known as the Construction Umbrella Bodies (CUB). The RICS have also produced a set of guidance notes (they cover the whole of the adjudication process however).
Liens are quite a hot potato. The RICS guidance says that no adjudicator can enforce a lien in the absence of the agreement of the parties.
Personally, I don't bother with a lien. Being an adjudicator is a commercial risk. Others have a problem with this and have a lien. As I see it, the adjudicator has a contract with the parties and you can sue on it if necessary.
At a recent meeting of RICS adjudicators, most said that they had at least one problem with being paid. But on the whole there appears not to be a major problem in this area. The RICS have not said that you can't have a lien, just that you should have the agreement of both the parties.
If adjudicators don't use liens and the result is that we are taken advantage of and we start having major difficulties in being paid, we adjudicators will vote with our feet and the industry will find that it has to agree to some form of security or it may find that it has a shortage of adjudicators. It is as simple as that.
The RICS Guidance is under constant review.
Slips. A lot of people seem to want a slip rule. The question I ask is why?
In the past I've made mistakes, I have amended them. It then becomes a matter of enforcement.
The statistics from the TCC are that something like 250-300 enforcement actions have resulted from adjudication. This means that there are around 4 - 5,000 situations where the parties have got to the point of settling their dispute through adjudication. Which is after all the point of adjudication.
If we make an error, as people do, whatever nature it is, my view is that we should amend it if it affects the rights of the parties. If the court doesn't like our decision, they will not enforce it. I believe that the proposed slip rule should be forgotten.
As I have said, the adjudication process is about putting parties in a position to resolve disputes. If they don't like our decision, it at least forms a basis for negotiation.
There has been no upsurge in TCC and arbitration work since adjudication was introduced - this must mean that adjudication is working. If adjudication was not working, we wouldn't see this.
Let us now look at training. Firstly, adjudicators have to be very good!
In 1995 this all started when the ICE put on a course because of the adjudication clause in the NEC contract. It has been continued by many other bodies in the context of the HGC&R Act since then.
A lot of adjudicators don't understand how to interpret agreements to reflect the rights and duties of the parties. The lack of knowledge and ability of technical adjudicators in understanding the law is one area where training has been found wanting.
A working party has been looking at training. A difference in viewpoint has been found between those who represent industry bodies as opposed to those who represent professional bodies. The professional ANBs appreciated that training is necessary and have mooted the idea of some kind of qualification resulting from certain training courses. Industry ANBs, on the other hand didn't want a qualification for adjudicators - they said that you'll end up like arbitrators. So, there is this tension between the two within the working party.
At the RICS, one area that we are concerned about is that some adjudicators do not correctly identify the issues. Also, we recognise that adjudicators should undertake continual professional development to ensure that their technical knowledge is up to date. It would perhaps be a good idea for all adjudicators on ANB lists to be re-assessed every 5 years or so. When they are, they should pass at the same level as those who are seeking to get on to the panel for the first time.
So it seems that training should include training on judicial techniques to ensure that adjudicators correctly identify and address the issues as well as continuous training on more technical matters.
Stephen Homer, Bevan Ashford. Solicitor and adjudicator
The Government's DTI paper suggested amendments to the scheme including a suggested limit on the slip rule in terms of time, is this going to be counter-productive?
CD - 48 hours is too short, but there needs to be some sort of finality to the process. There should be some sort of end date, for the sake of fairness to the other party.
John Redmond, Osborne Clarke
Why indeed do you need one?
CD - It certainly does add another dimension to jurisdiction issues. I think it is better to leave it as it is.
Guy Cottam, Guy Cottam & Partners
It came from the Arbitration Act
CD - You could say that slips are "clerical errors". It's the same thing really - missing a point of evidence.
Robin Gupta, Clarke Wilmott & Clarke
If it is said to pay adjudicator's fees in 14 days, does this not open a can of worms? Some adjudicators that I've come across require a deposit for their fees before they do any work.
CD - Well, if that is the case, report them to their ANB and tell them to get on with it. At the RICS we say that this is not the right approach.
JR - The RICS has particular clout. If they say that adjudicators can't have a lien, people will stop asking for them.
CD - A problem that the RICS has (as will other similar bodies) is that many of its members see it as a trade union, but in my view, when acting as an ANB it is serving the construction industry and must behave as such.
JR - I've found that if the majority of adjudicators are saying that they want a lien, I would advise clients not to rock the boat?
CD - So how many of you here who are adjudicators have ever not been paid?
JR - I've never not been paid.
GC - I've never not been paid and I've never gone for joint and several.
SH - What about if the parties talk about appointing you, and you do some preliminary work and then they decide not to appoint you in the end?
CD - You should be paid for the work you do.
Jan Grimshaw, Grimshaw Solicitors Limited
Just as an aside, I've found that a statutory demand always works well if you are chasing payment.
CD - As for the adjudicator's fee, what should you be doing if the fee seems too high?
GC - Going to the professional body as misconduct is inappropriate - these things should be looked at in court.
JR - What about if a particular adjudicator has many complaints?
GC - If you look behind the complaint you often find that the parties have been very satisfied with the particular adjudicator's work in the past and they just are concerned about the particular fee.
Roger Wills, Claims Consultant, Key Main Developments Limited
I have found some problems with picking the correct adjudicator. Sometimes adjudicators do not understand contracts. I was wondering whether the RICS has any thoughts on a particular standard being imposed for non-legal adjudicators across the industry?
CD - The RICS does not undertake training, it only assesses. In fact, there is a high failure rate. To be a Construction Arbitrator within the RICS you have to be a fellow of CIArb. A similar level of knowledge of contract law is expected of those who are nominated as adjudicator by the RICS. The RICS may well address this but is waiting to see the results of the CUB training working party.