Adjunction Report Adjudication Report Over

Adjunction Report

Adjudication Report

Over the last several decades the process of adjunction has become an increasingly familiar way to settle disputes within the Commonwealth of Australia. Simply put, adjunction is the process of resolving disputes using a third party adjudicator. Where, they listen to the arguments made by both sides and then render a decision. In general, it considered to be more efficient and cost effective in comparison with traditional litigation. Since Australia is managed based on a federal system that gives the states and territories more autonomy, meant that an uneven standard of settling disputes was in place. As each state / territory, would set their own standards for effectively handling various disputes. To address this issue, the Commercial Arbitration Act of 1986 established standards for arbitration that would be applied throughout the Commonwealth. Since that time, the process adjudication has been used increasingly to address a variety of commercial disputes. In the area of construction, this has led to a number of high profile cases that have had a dramatic impact upon the industry. To fully understand the overall effects of adjudication requires: that you consider the different types of models that are used and how it is affecting the adjudication process of the Commonwealth. Together, these two elements will provide the greatest insights as to how adjudication is becoming a common part of Australian legal traditions, for settling various commercial disputes that will arise.

UK Adjudication Model

The UK model for adjudication evolved out of necessity during the early to mid-1990's. What happened was the British construction industry began to see a significant slowdown, due to various procedural and judicial delays in settling different disputes. The situation became so bad, that Sir Michael Latham would chair a commission that would examine what were the issues faced by the industry and how they could be resolved. In the official report called Constructing the Team, they outlined a number of different issues and problems with the dispute resolution process. The most notable was the long delays that were seen in the industry in settling various disputes and disagreements that arise. As a result, the report recommended that adjudication would be the best way to resolve various issues that arise in the construction industry

. This would lead to the passage and implementation of Housing Grants, Construction and Regeneration Act 1996 or Construction Act. Under section 108 of the Act, any party has the right to bring forth actions that they believe should be resolved through the process of adjudication. The adjudicator is a neutral third party that will review all relevant materials, determine how they would apply to the law and make a ruling as to how the dispute should be settled. The adjudicator has 28 days to review all of the information and make a decision. Once a decision is reached, all parties are obligated to follow the rulings of the adjudicator, unless a court overturns the decision. All adjudicators can not be prosecuted for any of the rulings that they make as a part of the adjudication process.

Australia Adjudication Model

In Australia, the overall process of adjudication evolved differently, where there would be a universal standard for arbitration, but not a standard for adjudication. This is because of the vast size of the Commonwealth and the greater autonomy, meant that each state / territory could have different procedures for adjudication. As a result, the Australian model is a loosely based adjudication standard that can vary depending upon the state / territory. Where, some have adopted various adjudication standards for settling disputes, while others have no standards in place. A good example of this can been seen between New South Wales and Queensland, where two different pieces of legislation would set the standards for the process to include: Building and Construction Industry Security of Payment Act 1999 (for New South Wales) and Building and Construction Industry Security of Payment Act 2002 (for Queensland). This proved problematic, because parties could go through the adjudication process and if they lose, they could begin arbitration; effectively avoiding the adjudication penalties. To rectify this situation, New South Wales required that all losers in adjudication must pay all awards to the plaintiff (in a 2002 amendment). Queensland implemented a similar provision in 2007. This helped to increase the overall effectiveness of adjudication being used to settle a variety of disputes, in the construction industry. Besides the obvious differences of regional autonomy, the Australian model differs from the UK model based on the overall days that the arbitrator has to settle awards (which is: 10 days) and all claims must be made within the overall scope of the contract.

The Effects of Adjudication on the Commonwealth