Adjudication case law in Ireland in 2022
In the UK, adjudication was introduced by The Housing Grants, Construction and Regeneration Act in 1996, meaning that today England and Wales have a large body of case law on adjudication.
However, in Ireland, statutory adjudication was only introduced by the Construction Contracts Act 2013 and came into force in July 2016. The first reported enforcement decision was only in 2021, and as a result, case law is still limited.
A recent case has provided a further boost for adjudication in Ireland and reassurance for organisations and contractors seeking a fair hearing.
An overview of adjudication
Adjudication is a 28-day dispute resolution procedure. The adjudication process can be used to resolve disputes relating to payment under construction contracts. It is designed to be a fast way of resolving disputes with a view to protecting cash flow and to avoid long and expensive arbitration or court proceedings.
The appointed adjudicator is an impartial third party, and broadly speaking their decisions are interim-binding. That means they are binding unless or until the dispute is further determined by legal proceedings, arbitration or an agreement, or unless an obvious breach of fair procedures can be proven.
Establishing adjudication case law in Ireland
On the 11 January 2022 the Irish High Court handed down their judgment for John Paul Construction Ltd. relating to John Paul Construction Ltd v. Tipperary Co-operative Creamery Limited (2022). It was an enforcement decision where the paying party (the employer) sought to resist the enforcement, claiming:
- The adjudicator failed to comply with the requirements of fair procedures and natural justice by ignoring a substantive defence.
- That the adjudicator purported to reopen an issue which he had already been settled in an earlier adjudication.
- The adjudicator exceeded their jurisdiction by determining issues which were already the subject of an earlier adjudication decision.
The court’s decision reinforces the legal effect of adjudication in Ireland, and providing a tangible boost for the Construction Contracts Act 2013. Describing the case as “an attempt to judicially review the adjudicator’s decision through the back door”, The High Court said:
“It is wholly illegitimate for a defendant to comb through an adjudicator’s decision to try and find some aspect of the dispute which the adjudicator did not expressly address, and then argue on jurisdictional or natural justice grounds that the decision should not be enforced.”
Our view and what you need to know
At Tungsten Capital, and Staveley and Partners in Ireland, our emphasis is always on supporting clients where a claims notice has arisen, by seeking to protect their best interests and, wherever possible, to help all parties to settle without exorbitant court, legal or adjudication costs.
Of John Paul Construction Ltd v. Tipperary Co-operative Creamery Limited (2022) and its outcome, our Operations Director Terry Cage commented:
“The case shows the amazing defences that defendants will stoop to in order to avoid or defer payments. The result in court should provide credible organisations with reassurance that by presenting facts clearly, reasonably and professionally they can be assured of the support of fair legal process.”
If you would like to find out more about our services helping clients to resolve construction disputes and claims in Ireland, contact our team via the link below or visit our Dublin based partners at Staveley & Partners.