Friday, January 31, 2014

Adjudication and the Construction Contracts Act 2013 - a few more anomalies perhaps?

As I've only a partial legal background (in the form of PGrad's in Law courses) the following is purely an observational take on Justice Clarke's informal discussion in the IEI yesterday evening.

In the main the discussion was related to Constitutionality, which by it's nature is a complex but very interesting part of the Law. It is also safe to say that this area of Law is best left to the experts but I'll give a blast at my take on it anyhow, in my own observational manner.

The first note I took is the way the Irish Constitution works placed alongside the UK is incomparable. We have a written one they don't. This then requires the adjudication process or the process of the adjudication itself to be a stronger requirement in Ireland. The process must fundamentally be a fair process. Fairness is crucial.

Two main area's of controversy are viewed.
  1. What is fair process in the eyes of the court and how will the courts approach this issue if someone cries hardship and unfairness of the adjudication process?
  2. The speed required (28 days).
Fair process:
Examples - a recent challenge to the NAMA legislation was a success. It was unfair for the lads in NAMA to grab the performing loans even though the legislation gave them that power.

The adjudication process is seen perhaps more of an inquisitorial nature rather than a litigious one and this then could be compared to the current emigration process's. 

The advice emanating is that all information and particularly any significant information that the adjudicator has within the adjudication process must be shared equally between the parties. 

Also Adjudicators take note that you will have a Constitutional duty placed upon you under the Act.

No easy answer on this requirement. The only comparison that is possible is the examiner process which allows a maximum of 100 days. Some examiner-ships have missed the deadline having not had enough time for all the hearings and what not and ultimately liquidation was instigated, i.e. recently the O'Brien Sandwich's examiner-ship.

In summary the process itself doesn't require us to follow rules of evidence, fairness is all that is necessary. Also for fairness to be seen and in order to get to the facts of some cases, cross examinations will be necessary. This again will place added time pressures.

Other issues raised apart from the Constitutional aspects are that there still isn't available a specialist court to speedily enforce a decision and also that no rules of court have been drafted for such an instrument.

One also feels that the poor old draft code of practice got a good bashing over the last few days for it's repetitive nature and other such anomalies (i suppose that's what drafts are for). The Society of Chartered Surveyors (SCS) views re-affirmed what has been stated in the lectures and group think-ins over the last while, i'm sure they won't mind me offering the link to their document.

To finalize for now, my thoughts are that one got the feeling over the last few days that if the Judges were allowed to say something on this Act in a cut chase fashion they would be saying something along the lines of "us Judges are the law makers, we make the laws, ye lads are the builders, ye build stuff, let us do our job and ye do yers".

Tuesday, January 28, 2014

Construction Contracts Act 2013

Apologies once again to all followers to this blog for my demonstration as the laziest blogger of all time. I will definitely make it a new years resolution to beat my number of posts of last year.

Anyhow, just in from the Adjudication Society conference this morning where widespread discussion on the possible new Adjudication coming into our industry.

As far back as 2011 we were a bit negative here towards some aspects and some of the mechanisms of this new Construction Bill (in the draft format it was in at the time) and after today's overview I would say that this negativity has only increased.

Many holes were picked through the Act by the expert and experience speakers:

Some of these are summarized from my notes as follows:

  1. Unclear if 'paid when certified' will be a loophole that can be exploited and the Act is silent on this,
  2. The terminology is not linked to contract 'speak', i.e. the term 'Payment Claim' is new,
  3. Payment Claim Notice is silent on time,
  4. Act mentions 'subject matter' of a claim, fruitful exploitation for lawyers here as this could be anything?
  5. With holding notice by the payer - this will generate additional administration for payers,
On top of all this the final after lunch talk given by a highly eminent Judge was damning to say least. His focus was mainly on section 6 of the Act. 

S.6 part 9 states that 'initiative' is to be used by an adjudicator. This wording is weak as far as the Judge is concerned and the wording here should have been drafted better. The Judge also did not like the temporary binding nature of the Act as set out in S.6 part 10. In fact the Judge went as far as to state that 'bad law' could be pleaded by a party in order to thwart the whole process.

I hope to revert back to this whole subject in more detail later. Like everyone else this is all new and thus more information gathering is necessary.

I also understand that another Judge will be giving a view on this tomorrow evening in Engineer's Ireland which will be interesting.

Time will tell how this Act will be implemented, if implemented at all!