Within the context of the Housing Grants, Construction & Regeneration Act 1996 (known generally as the 'Construction Act'), evaluate the key strengths and weaknesses of the Adjudication provisions.
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Measurement & Practice 1 Assignment 1 Pearse Lewis Task. Within the context of the Housing Grants, Construction & Regeneration Act 1996 (known generally as the 'Construction Act'), evaluate the key strengths and weaknesses of the Adjudication provisions. Speculate, explaining your reasons as to whether Adjudication will actually lead to the resolution of disputes, to the mutual satisfaction of the parties or whether it will become largely discredited over the next decade. The Housing Grants, Construction and Regeneration Act 1996 came into force on 1st May 1998, and dealt with three construction related matters. Firstly, "construction contract" (defined in sections 104 and 105 of the Act). Secondly, allowed for measures providing for the compulsory availability of Adjudication and its consequences (section 108 of the Act). Thirdly, important provisions dealing with the right to payment under a construction contract (sections 109 to 113 of the Act). This essay will examine the key strengths and weaknesses of the second construction related matter of the Act, involving Adjudication provisions.
Whereas, before the Construction Act, contractors could hold money back until the dispute was resolved after the contract had finished, using arbitration. With adjudication the monies are paid and then can be claimed back if the courts found (through arbitration) that the adjudication decision was wrong. The main advantage of this is that small sub-contractors get paid the amount owed to them in the short-term and can carry on working on site. Without the Adjudication provisions main contractors could hold back money for a long period of time (until the dispute had been resolved) and often the small contractor would go bankrupt during that period. The fact that there is a binding decision at any time, as disputes are settled when they occur ensures there are less 'hold ups' to the project and this means there is more of a flow throughout the construction programme, and less delay. There is also the fact of the simplicity of the process, which means it is a lot easier than going to arbitration through the courts, and all the parties focus on the dispute.
The majority of construction professionals, 80% in the survey, believe that adjudication is better than its pre-Act alternatives (see Appendix V), and 92% believe it is an effective (either satisfactory or better) means of resolving construction disputes (see Appendix VI). Richard Hawkins5 suggests that, "If adjudication is to work, adjudicators must acknowledge that they are appointed to make a decision that will enable two disputing parties to resolve their differences. Adjudicators should take the initiative in ascertaining for themselves the facts and the law. If they are unable to do this, they should seek training immediately." After looking at all the facts involved with the strengths and weaknesses of the Adjudication provisions within the 'Construction Act', and the survey results in the Appendix, I believe it will be accepted and will continue to be used as the main form of alternative dispute resolution over the next decade. The fact that the courts are backing the adjudicators decisions if it goes on to arbitration show that they are determined to make this system work.
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