Adjudication

Definition and legal basis:

Adjudication is an alternative dispute resolution procedure that is particularly widespread in Anglo-Saxon jurisdictions, especially in the UK. It is a quick, provisionally binding procedure for resolving disputes, mainly in the construction sector. In Germany, adjudication is not regulated by law, but can be contractually agreed. The legal basis in the UK is the Housing Grants, Construction and Regeneration Act 1996, which was amended in 2009. Adjudication aims to resolve disputes quickly and cost-effectively during an ongoing project in order to avoid construction delays and cost explosions. The adjudicator makes a provisionally binding decision that must be implemented by the parties until it is revised by court or arbitration proceedings, if necessary.

Procedure and characteristics of the adjudication process:

The adjudication procedure is characterized by the following features: 1. speed: the procedure is usually completed within 28 days.
2. provisional binding effect: the adjudicator’s decision must be implemented immediately, but can be challenged later.
3. flexibility: the adjudicator has extensive freedom in structuring the procedure.
4. expertise: adjudicators are often experts in the relevant field (e.g. engineers, architects). The typical course of an adjudication procedure includes:
– Initiation by one party with notification of the other party
– Appointment of the adjudicator (if not already specified in the contract)
– Submission of the statement of claim and response
– Investigation and taking of evidence by the adjudicator
– Decision by the adjudicator within the specified time limit

Advantages and challenges:

Adjudication offers several advantages: 1. fast conflict resolution during ongoing projects 2. cost efficiency compared to court or arbitration proceedings 3. expert decision-making by experts 4. maintenance of business relationships through swift dispute resolution Challenges of adjudication are:
1. possible loss of quality due to time pressure
2. Risk of premature or unbalanced decisions
3. Potential difficulties in enforcement in other jurisdictions
4. Costs for subsequent court or arbitration proceedings in the event of a challenge

Areas of application and practical significance:

Adjudication is mainly used in – Construction disputes (main area of application) – Engineering projects – Major infrastructure projects In practice, adjudication is often used for the following disputes:
– Payment disputes
– Delays and extensions to construction periods
– Defects and quality issues
– Contract interpretation and amendments The importance of adjudication is also increasing outside the Anglo-Saxon legal area, as it offers an efficient way of resolving conflicts in complex projects in a timely manner.

Comparison with other dispute resolution methods:

Compared to other methods of alternative dispute resolution, adjudication has the following special features: 1. mediation: unlike mediation, the adjudicator makes a binding decision.
2. arbitration: Adjudication is quicker and less formal than arbitration.
3. Court proceedings: Adjudication offers a much quicker resolution than an often lengthy court process.
4. Conciliation: unlike mediation, the adjudicator’s decision is binding, albeit provisional. The choice between these procedures depends on factors such as time pressure, complexity of the case, costs and the desired binding nature of the decision.

Implementation and legal challenges in Germany:

In Germany, adjudication is not enshrined in law, but can be contractually agreed. The following aspects must be taken into account during implementation: 1. Contractual drafting: Careful wording of the adjudication clause in the contract
2. Enforceability: Ensuring the enforceability of the adjudicator’s decision
3. Qualification of the adjudicator: Selection of suitable, expert decision-makers
4. Compatibility with German procedural law: consideration of mandatory provisions The introduction of a legal framework for adjudication is being discussed in Germany in order to increase legal certainty and facilitate its application. In summary, adjudication offers an efficient way of resolving disputes quickly, particularly in the construction sector. Its strengths lie in its speed, expertise and provisional binding effect. Although it is not yet as established in Germany as in Anglo-Saxon countries, it is becoming increasingly important as an alternative to lengthy court proceedings. However, successful implementation requires careful contractual drafting and consideration of the specific legal framework.