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Having recently arrived in Singapore I discovered that adjudication is very much alive and kicking in this region. How then does it compare with the UK and are there any significant differences in approach?  

Where did it all begin? 

The origins of adjudication in the UK stem from Sir Michael Latham’s report ‘Constructing the Team’ which was published in 1994. His report made several key recommendations including a more collaborative approach between the stakeholders to a project, a structured payment regime and a system of mandatory adjudication to swiftly address conflicts. The key recommendations of the Latham report were captured in the Housing Grants Construction and Regeneration Act 1996 which was subsequently amended by the Local Democracy, Economic Development and Construction Act 2009. These two Acts have become known as the Construction Act and first became law in May 1998. 

A key component of the Construction Act is a right to regular staged payments for works completed and if those payments are not made there is a right to suspend performance and refer the dispute to an independent adjudicator for determination. In fact, the Construction Act allows parties to a construction contract to refer any dispute at any time.  

The original intention was that this process would be quick and relatively cost effective and maintain cashflow within the project.  

The process has generally succeeded in maintaining cashflow, however from my perspective there has been a move towards referring larger and more complex disputes to adjudication. 

In my experience this expansion of adjudication centres around: 

• Large and complex claims for delay and disruption and the financial effects thereof;
• A rise in professional indemnity claims linked to consultant performance; and
• A surge in building safety matters now being referred to adjudication in the UK.

These large value / complex disputes often come with the need for input from either a delay, quantum or technical expert or a combination of the three. The result is a process that, in many instances, takes longer and costs more.

Singapore Approach 

While there are many similarities between the UK and Singapore, there are some differences. The Singapore process is quicker than the UK generally taking 21 days compared to the 28 – 42 days in the UK.

However, one of the more significant differences is the approach to claims for loss and damage. Under the Building and Construction Industry Security of Payment (Amendment) Regulations 2019, which came into force in Singapore in December 2019, when making an assessment: 

Therefore, if either party includes a claim for damage or loss in the submissions, unless it is supported by an agreement between the parties, the adjudicator must exclude it from any consideration.

Arguably, this approach ensures swift decision and upholds the original intent of both countries’ adjudication processes i.e. maintaining project cashflow.  

One can imagine the response in both countries if the respective governments tried to introduce reciprocal arrangements. UK contractors would likely object, while contractors in Singapore might welcome the opportunity to include claims for loss and damage.  

Within Singapore, if a contractor wishes to advance a claim for loss and damage, the process is either arbitration and/or litigation.

Therefore, when making a comparison on speed, perhaps a better measure is to compare the UK adjudication timescale with a combination of adjudication and arbitration/litigation in Singapore. On this basis the UK approach may be viewed as cost and time effective, albeit the decision is not final and binding as would be the case with arbitration or litigation decision in Singapore.

So, what is the answer to dealing with complex disputes? Is there room for some form of hybrid solution - somewhere between adjudication and arbitration, thereby maintaining privacy. Or perhaps independent expert determination will become more prevalent?

If a longer period to determine the dispute is allowed this should provide for a more detailed investigation of the facts by the parties and their respective legal and expert teams thereby giving reasoned and understandable decisions. However, a longer period to determine the dispute has obvious potential impacts on cashflow and overall costs in the process.

Kings College London (KCL) and the Adjudication Society recently published the 3^rd edition of its annual adjudication report¹. The report concluded that in the UK adjudication is generally working, but as summarised by Mr Justice David Waksman in the Foreword there are issues to be addressed.

“The longer periods are, of course, caused principally by the more complex disputes, but it is a pity that party behaviour is a factor in 24% of such cases. The section on the leading causes of disputes in adjudication in the last year is another important part of the report because the causes are not described by legal terminology but by reference to the underlying causes such as inadequate contract administration or lack of competence, adversarial culture or exaggerated claims. This clearly has lessons for both the employers and contractors.”

As highlighted, the wishes of Sir Michael Latham’s report of fostering a more collaborative approach within the project team remain. Consequently, there will always be a need for quick and cost effective dispute resolution. How the process will evolve to address the challenges posed by large and complex claims remains uncertain.  

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Footnotes

¹ 2024 Construction Adjudication in the United Kingdom: Tracing trends and guiding reform – Kings College London and the Adjudication Society