Construction Payment Disputes

A FAST, COST EFFECTIVE WAY TO RESOLVE YOUR CONSTRUCTION DISPUTES

Have you completed construction work but not been paid?

In these times of rollercoaster economics, maintaining cash flow is becoming an increasingly difficult task for businesses. But how can you resolve a payment dispute relating to construction work quickly, while avoiding lengthy court proceedings and costly legal bills?

The Construction Contracts Act 2004 implies into all “construction contracts” a mechanism for a rapid adjudication procedure which enables parties to a payment dispute to submit a dispute for adjudication and have a determination within 1 month.

The process as outlined in the legislation is relatively simple:

• You (the claimant) have 28 days from when a payment dispute arises to apply for adjudication with either an agreed or appointed adjudicator;
• The Respondent has 14 days to respond in writing; and,
• The Adjudicator then has 14 days to consider the application and the response and make a determination on the amount to be paid (usually without the need for a hearing).

In almost all cases, the Adjudicator’s costs are shared equally by the parties and will vary depending on various factors – including the complexity of the matter and the Adjudicator’s experience and charge rate. The Adjudicator’s determination can also be registered as a judgment in a Court. Compared to commencing proceedings in a Court, this process offers a relatively inexpensive, and certainly a much quicker, way to obtain payment .

There are a few quirky elements to the Construction Contracts Act, 2004, including the exclusion of certain kinds of work from the “construction work” (as defined in the Act) and identifying when the payment dispute arises. Avon Legal’s Litigation team is happy to help you with any queries about this alternative to litigation.