Local Government Lawyer Home Page

Sharpe Edge Webpage Banner

Welcome to Sharpe Edge, Sharpe Pritchard’s local government legal hub on Local Government Lawyer.

Sharpe Edge features news, views and analysis from our team of specialist local government lawyers working at the heart of the latest legal developments. Sharpe Edge platform is also the only place where local government lawyers can get e-access to two law books by our Head of Local Government Rob Hann: The Guide to Local Authority Charging and Trading Powers (‘LACAT’) and The Guide to Local Authority Companies and Partnerships (‘LACAP’).



Slide background

Adjudication 101: Introduction and Overview

Icons HouseMichael Comba traces the origins of adjudication and considers why the process was introduced, who it is aimed towards and how construction contracts must include certain provisions.

Adjudication 101 is a series of four short articles regarding the origins and lifecycle of adjudication. In the series, we look at the background to the introduction of adjudication and the adjudication process from commencement up to the adjudicator’s decision. In the first part, Solicitor, Michael Comba, traces the origins of adjudication and considers why the process was introduced, who it is aimed towards and how construction contracts must include certain provisions.

Adjudication 101: Introduction and Overview

1996 wasn’t just Euro heartbreak, the Nintendo 64 and Clinton v Dole. That year also saw a revolution in construction contracts through the Housing Grants, Construction and Regeneration Act 1996, more commonly known as the Construction Act. Alongside its introduction of mandatory interim payment regimes, changed construction contracts immeasurably by introducing a statutory right to adjudication.


Contractors often operate on very low margins in an industry notorious for delay and disruption. In 2018, the CBI estimated that the average profit margin for a top 100 contractor is 2.6%, compared to 17.6% across all sectors. For contractors, cash really is king. They are particularly anxious not only to get paid, but can also be disinclined to pay others.

This became particularly acute in the context of the early 1990s recession. With cashflow drying up, contractors found it difficult to get paid and were increasingly reluctant to pay subcontractors. Contractor and subcontractor insolvency ensued, causing not only economic problems but also significant supply chain disruption.

The Construction Act brought a solution in the form of mandatory interim payment regimes for construction contracts. This meant that employers and main contractors were significantly constrained from delaying or avoiding payments. However, these provisions still required enforcement, and policymakers did not want to choke the courts, already swamped with construction cases, with payment disputes. Formal litigation also had disadvantages for those in disputes; it is expensive and can become drawn out.

This is where adjudication comes in. The Construction Act confers a statutory right on all construction contracts to refer “any dispute” at “any time” to adjudication. Statutory provisions also provide, as a starting point, for decisions in adjudications to be reached within 28 days.  The intention was to ensure parties had an ability to resolve disputes, particularly payment disputes, to an easy, speedy and cost-effective dispute resolution procedure.

In the years since, parties have really run with the term “any dispute”. Adjudication now covers all manner of construction disputes alongside payment disputes, such as delay claims, loss & expense, defects and negligence under professional appointments. Disputes being adjudicated now range in value from the very small to tens of millions.

Nonetheless, the emphasis is still on ‘rough justice’.


The right to adjudicate is implied into all construction contracts, as defined under the Construction Act. The Construction Act defines such quite broadly at s.104; it covers all contracts concerning ‘construction operations’. Construction operations are defined at s.105 and concerns all manner of conceivable construction activities, including things like professional consultants and maintenance. The Construction Act was amended in 2009 to remove the requirement for such contracts to be in writing.


These provisions are subject to a few exclusions; contracts with residential occupiers are excluded and further contracts are through the Construction Contracts (England and Wales) Exclusion Order 1998. Most notably this order excludes top-tier PFI agreements and certain development agreements.

More controversial are the exclusions at s.105(2), particularly the exclusions relating to power generation. Critics have accused these provisions as being arbitrary and they are a regular theme in litigation.

Other documents

Another point often debated is whether certain ancillary documents, such as collateral warranties or settlement agreements are construction contracts. The former was the subject of the recent case Toppan Holdings Ltd and another v Simply Construct (UK) LLP and looks something set to rumble on.

Parties are also free to contract to allow for adjudication to apply. PFI agreements, for example, regularly adopt adjudication (or something very similar) as its dispute resolution procedure.


The Construction Act also sets out how construction contracts should provide for the conduct of an adjudication. A construction contract must include provisions (among others) that:

  1. Enable either party to issue a notice of its intention to refer a dispute to adjudication at any time;
  2. Provide a timetable that allows the adjudicator’s appointment, and the issue of a referral (akin to a particulars of claim) within 7 days of the notice;
  3. Require the adjudicator reach a decision within 28 days of the referral (or a longer period to be agreed);
  4. Allows the adjudicator to extend their deadline by 14 days, with the consent of the referring party;
  5. Requires the adjudicator to act impartially; and
  6. Enables the adjudicator to “take the initiative” in determining the facts and the law.

If a contract does not incorporate all of these necessary provisions then Part I of the Scheme for Construction Contracts (England and Wales) Regulations 1998 (amended by 2011 Regulations and supplemented by Regulations specific to Scottish contracts), more commonly known as the Scheme, shall apply. It is an ‘all or nothing’ approach.

Aside from incorporating the more general provisions above, the Scheme also implies some more detailed provisions (such as the nature of the notice and the referral) on the conduct of an adjudication.

With us now for over 25 years, adjudication and its rough justice is here to stay. It is by no means faultless and the growing complexity of disputes may put it under increasing strain. Nonetheless, it is popular, particularly among contractors, and has been replicated in many other legal systems around the world. For those involved in construction, it is essential to get to grips with the basics of adjudication. Tune in for the remainder of our adjudication 101 series that will cover (among others):

  • Commencing an adjudication (notice, appointment and the referral);
  • The adjudication itself (adjudicator’s powers, directions and the response);
  • The adjudicator’s decision (timescales, reasons and the slip rule);
  • Enforcing the decision (role of the TCC and duty of natural justice)

Michael Comba is a Solicitor at Sharpe Pritchard LLP.

For further insight and resources on local government legal issues from Sharpe Pritchard, please visit the SharpeEdge page by clicking on the banner below.

sharpe edge 600x100

This article is for general awareness only and does not constitute legal or professional advice. The law may have changed since this page was first published. If you would like further advice and assistance in relation to any issue raised in this article, please contact us by telephone or email This email address is being protected from spambots. You need JavaScript enabled to view it.

LACAT BookFREE download!

A Guide to Local Authority Charging and Trading Powers

Written and edited by Sharpe Pritchard’s Head of Local Government, Rob Hann,

A Guide to Local Authority Charging and Trading Powers covers:

• Updated charging powers compendium          • Commercial trading options

• Teckal ‘public to public’                                    • Localism Act


LACAT BookAvailable to buy:

A Guide to Local Authority Companies and Partnerships

An invaluable, comprehensive toolkit for lawyers, law firms and others advising
on or participating in Local Authority Companies and Partnerships”

- Local Authority Chief Executive


  More Articles

Icons House

Thurrock Council & Another v Adams & Ors [2022] EWHC 1324 (QB)

William Rose, Partner at Sharpe Pritchard LLP, has successfully acted for Thurrock Council and Essex County Council in obtaining a ‘first of its kind’ injunction against individuals connected with the protest group Just Stop Oil.
Icons Date

The Adjudication Part 3: The Response and Further Submissions 9 June 2022

David Owens and James Goldthorpe look at the responding party's response and further submissions during adjudication.
Icons House

A renewable future: focusing energy solutions at a local level

Natasha Barlow and Steve Gummer discuss the 'Energy Trilemma' and how it is playing out at a local level.
Icons Date

Procurement Bill – Initial impressions from the first draft

Juli Lau and Sophie Mcfie-Hyland outline their initial impressions from the first draft of the Procurement Bill.
Icons Hazard

Let’s paint the town green! Government plans for green homes

Laura Campbell discusses the change urgently needed in towns and cities to make the landscape greener.
Icons House

The Queen’s Speech in Brief

The number of Bills which affect public sector clients is greater than usual – and the government have got straight off the starting blocks by publishing some of them already.
Icons Hazard

Refurbishment and Retrofitting: In with the old, out with the new!

Sharpe Pritchard analyse the challenge of decarbonising the construction sector.
Icons House

NET ZERO – What obligations are there on the UK to achieve it?

Radhika Devesher takes a look at the legal duty to achieve net-zero placed upon the UK.
Icons House

Championing green goals through public buying

Juli Lau considers how public purchasing power can be used to champion Net Zero goals, and how public procurement might be used as another driver for change.
Icons Hazard

Top Tips for Local Authority Lawyers advising on Data Protection Matters

Charlotte Smith and Hannah Peto set out some of their top tips to consider when advising on data protection matters.
Icons Court

The Cost of Freedom of Information – The Council’s Failure to Advise

Charlotte Smith and Nadia Ahmed summarise the case and judgement of Moss v Royal Borough of Kingston-upon-Thames and another (NJ/2018/007).
Rob Hann Photoshop

Ask the Author

These are frequently asked questions to Rob Hann from colleagues in Local Government via the Sharpe Pritchard ‘Ask-the-Author' facility concerning the subject matter of his books on local authority companies, partnerships, charging and trading.
Icons Court

A call to review public contracts with Russian suppliers

Juli Lau and Gonzalo Puertas discuss the first official document to consider public sector contracts with companies linked to the Russian and Belarusian state regimes, issued by the Cabinet Office.
Icons Date

A New NEC Option to tackle greenwashing in the construction industry

Allan Owen and Sophie Drysdale discuss 'greenwashing' in the construction industry and a new secondary option clause X29 for its NEC4 suite of contracts developed by NEC.
Icons House

The Pathway to the Future – The Road Map for Employment Tribunals

David Leach discusses and outlines the road map of the planned changes for modernising the Tribunals in 2022 and 2023 released by The Presidents of the Employment Tribunals.
Icons House

Farrar Out

Clare Mendelle and James Goldthorpe discuss how the insolvency of Farrar Construction leads to clarity from the Courts on dealing with an insolvent contractor under JCT.
Icons House

The UK government has this week introduced the Economic Crime (Transparency and Enforcement) Bill

Peter Collins and Sophie Pilcher discuss the Economic Crime (Transparency and Enforcement) Bill introduced by the UK Government this week.
Icons Hazard

A sweet truth for selectivity

Steve Gummer and Gonzalo Puertas discuss a case that concerns an application for judicial review seeking to challenge a decision to introduce a zero-duty autonomous tariff quota (“ATQ”) of 260,000 metric tonnes of raw cane sugar for refining.
Icons Date

New Government Guidance on PFI Expiry

Rob Hann, Head of Local Government at Sharpe Pritchard, takes a look at new guidance on PFI expiry recently published by the IPA to help public bodies wrestle with the complexities of transition they will face as these contracts reach full term.
Icons Hazard

Three new Levels to ‘level up’ Local Government in England?

Rob Hann, Sharpe Pritchard’s Head of local government, takes a look at the new proposals under the Government’s Levelling Up White Paper to facilitate devolution to remaining regions of local government in England which are currently without a Mayoral Combined Authority.
Icons Hazard

Will employers still be able to use the practice of ‘fire and rehire’ in 2022?

Christian Grierson and Julie Bann discuss a recent case in which the High Court has granted an injunction preventing Tesco from using the controversial employment practice of ‘fire and rehire’.
Icons Hazard

Progress on Climate Change action plans in Local Government

Stephen Cirell discusses the progress on climate change and renewable energy action plans within Local Government.
<a href=

Witches’ hats, sexist comments, and a £2 million pay-out

Julie Bann and Christian Grierson discuss a case in which a finance specialist has won over £2 million in compensation, after claims of sex discrimination and unequal pay.
Icons Hazard

Stuck in traffic?

High Court rules “VIP Lanes” For PPE contracts breached fundamental procurement law principles, in latest Judicial Review victory for the Good Law Project.
<a href=

Local Authority Sports and Leisure provision – Challenges Post-Covid19

With the unique circumstances posed by the Covid 19 pandemic and temporary closures of Council-sponsored sports and leisure facilities, Rob Hann, Sharpe Pritchard’s Head of Local Government outlines some of the challenges the sector faces.
<a href=

Bucking the Trend on Specific Performance Buckinghamshire Council v FCC Buckinghamshire Limited

Clare Mendelle and James Hughes highlight the wide definition of Third-Party Income and the measures the courts are prepared to take to enforce the terms of longstanding contracts, by analysing the Buckinghamshire Council v FCC Buckinghamshire Limited case.
<a href=

The Government’s response to the Transforming Public Procurement consultation: what will change and what will not?

Juli Lau, Colin Ricciardiello, Beth Edwards and Natasha Barlow analyse the Government’s response to the Transforming Public Procurement consultation.
<a href=

Momentum for Heat Network Roll Out Gathers Pace

Steve Gummer discusses the increased momentum for a Heat Network Rollout.
Icons Hazard

Unconscious Bias, Discrimination and a Warning to Public Sector Employers

Christian Grierson and Julie Bann discuss two employment tribunal judgements, which provide a stark warning to public sector employers about unconscious bias and discrimination.
Icons Hazard

Levelling up – A new opportunity for further devolution in England?

Rob Hann explores the Government's 'levelling up' policy and looks at whether it is an opportunity for further devolution in England.
Slide background