Adjudication
Adjudication is an interim decision-making process that is suitable for resolving disputes during ongoing ventures, such as large construction projects. A neutral adjudicator is pre-appointed to resolve any disputes as they occur throughout the life of the project. The parties can select an adjudicator with expertise in the area of the potential disputes. In addition, the parties will agree in advance on a set of rules of procedure, disclosure, and evidence. Because decisions are made on a quick and informal basis, the result may be imperfect. The adjudicator’s decisions, however, are binding, but only until the project has been completed. At the end of the project, if either party is dissatisfied with the adjudicator’s decisions, they can reopen the disputes, as if the adjudication had never occurred. When this happens, no reference is made in any subsequent procedure to the fact that adjudication occurred or to the result.
The principal benefit of adjudication is timeliness. It allows a decision to be made before a dispute has had a chance to fester and infect the relationship between the parties with further ill will. In some situations, unresolved disputes may cause workers to put down their tools or owners to withhold payments from contractors. When this happens, the project is unnecessarily delayed and, in extreme cases, it can slide into insolvency. Adjudication allows determinations to be made when the facts are fresh in everyone's mind, while witnesses are still available, and before important documents have been lost or misplaced. Adjudication, when effectively used, helps to minimize work disruption and ensures continued cash flow.
Because they know that the adjudicator’s rulings are ultimately non-binding and cannot be referred to in any future contest, the parties are usually willing to live temporarily with the imperfect outcomes that this quick, efficient, and relatively informal process may sometimes produce. In reality, however, experience shows that most adjudicated decisions are accepted on a permanent basis, making subsequent proceedings rare. In appropriate circumstances, adjudication can represent a low-cost, quick, and effective way to resolve disputes in the case of ongoing ventures or projects.
The principal benefit of adjudication is timeliness. It allows a decision to be made before a dispute has had a chance to fester and infect the relationship between the parties with further ill will. In some situations, unresolved disputes may cause workers to put down their tools or owners to withhold payments from contractors. When this happens, the project is unnecessarily delayed and, in extreme cases, it can slide into insolvency. Adjudication allows determinations to be made when the facts are fresh in everyone's mind, while witnesses are still available, and before important documents have been lost or misplaced. Adjudication, when effectively used, helps to minimize work disruption and ensures continued cash flow.
Because they know that the adjudicator’s rulings are ultimately non-binding and cannot be referred to in any future contest, the parties are usually willing to live temporarily with the imperfect outcomes that this quick, efficient, and relatively informal process may sometimes produce. In reality, however, experience shows that most adjudicated decisions are accepted on a permanent basis, making subsequent proceedings rare. In appropriate circumstances, adjudication can represent a low-cost, quick, and effective way to resolve disputes in the case of ongoing ventures or projects.