INITIATING ADJUDICATION

The first and most important step in the proceeding is service by the claimant of the notice of adjudication. Adjudication is initiated by a claimant serving written notice of the claimant’s intention to refer a dispute to adjudication on the other party or parties to the construction contract, and the owner of the construction site if a determination of an owner’s liability is sought under section 30(a) and approval of a charging order is sought under section 30(b).

The requirements for a notice of adjudication are set out in section 28(2) of the Act. The requirements are mandatory and there is very little discretion regarding compliance with section 28(2) of the Act afforded the adjudicator under section 64 of the Act in the event of a failure on the part of the claimant to include the required information.

The notice of adjudication must include:

• The date of the notice;

• The nature and a brief description of the dispute and of the parties involved;

• Details of where and when the dispute arose;

• The relief or remedy that is sought;

• Whether approval for the issue of a charging order under section 29 is being sought;

• Whether a determination of the owner’s liability under section 30(a) and an approval for the issue of a charging order under section 30(b) are being sought;

• Details sufficient to identify the construction contract to which the dispute relates including: the names and addresses of the parties to the contract, and if available, the addresses that the parties have specified for service of the notices.

Great care should be taken with the preparation of the notice of adjudication because it is from this document that the adjudicator derives his or her jurisdiction in relation to the nature and scope of the dispute that may be determined. In short, if the notice does not include a matter or matters subsequently raised in an adjudication claim, there is simply no jurisdiction for an adjudicator to determine those matters.

Notwithstanding the requirement for strict compliance with section 28(2) it is not necessary for a claimant to establish the full details of the quantum of a claim before referring that dispute to adjudication. The relief or remedy sought may be couched in the form of a question i.e. “what sum is due?” or made “in the amount of [$amount] or such other sum as the adjudicator may determine”. An adjudicator could not determine an amount payable in excess of any stated amount claimed and any determination so made would be invalid for want of jurisdiction and unenforceable.

A notice of adjudication served on a respondent who is a residential occupier as defined in section 5 of the Act must, in addition to the matters set out in section 28(2) set out prominently a statement of the residential occupier’s rights and obligations in the adjudication and a brief explanation of the process (s62). These matters must be set out in the prescribed form (Form 2) which may be found in Schedule 1 of the Construction Contracts Regulations 2003 (the Regulations). It is important to be aware that under section 62(3) of the Act, a notice of adjudication served on a residential occupier that fails to comply with the requirements in section 62(1) i.e. fails to set out prominently a statement of the residential occupier’s rights and obligations in the adjudication and a brief explanation of the process, has no effect and in order to initiate an adjudication, a claimant would need to serve a new notice that complies with these additional requirements.

Click here to download a template for a valid Notice of Adjudication including the notice to a residential occupier.