Considering new evidence

The whole point of adjudication is to reach a speedy decision.

But what happens when new information comes to light?

Daniel Atkinson asks whether an extension of time is the answer.

ONE OF THE defining features of statutory adjudication is the short timescale in which the adjudicator must give his decision. He has 28 days, which can only be extended if the party that commenced the process gives its consent - and then by only 14 days. Any further extension requires the agreement of both parties.

The success of this unique method of dispute resolution depends on the short timescale . The parties and the adjudicator must focus on the issues and get right to the nub of the dispute. In this situation, the adjudicator's ability to take the initiative in ascertaining the facts and the law is a powerful tool, especially in the hands of an experienced construction professional. Often the decision of the adjudicator is of the highest quality precisely because all parties are focused on getting the right answer quickly.

But the short timescale can also cause problems. In certain circumstances it might deny one party the proper opportunity to deal with the case, particularly if new and important information comes to light during the 28-day period.

Bearing in mind that the whole point of adjudication is to reach a speedy decision, what is the right way to proceed when such a situation arises? Should the parties agree to extend the statutory 28 days so the new information can be considered? Or should the whole process be scrapped?

In the recent case of Edmund Nuttall v RG Carter (2002), Judge Seymour QC made a decision that threatens to undermine the success of adjudication.

This dispute was about delays to the contract, and Nuttall was seeking the right to extend the date for completion of the works. Nuttall commenced the adjudication and issued an expert report setting out the justification for the extension of time. Not only had this expert report not previously been issued to Carter but it also identified causes of delay quite different to those identified in previous claims for an extension of time.

Judge Seymour's response was to declare that a party cannot abandon wholesale facts previously relied on, or arguments previously advanced, and then contend the dispute is the same. He said that the matter decided by the adjudicator based on the expert report was not the dispute which existed when the adjudication commenced. The adjudicator lacked jurisdiction and Judge Seymour refused to enforce his decision.

The effect Judge Seymour's interpretation has had on the way adjudication is practised has been dramatic. It is now common for parties to attempt to exclude from the adjudication evidence that had not previously been made available to them before commencement of the adjudication. This includes not only material in the documents issued to commence proceedings but also information that comes to light during proceedings.

If this approach is correct, the adjudicator's power to ascertain the facts and the law will be severely curtailed in practice, and the process of adjudication robbed of its cutting edge. Evidence should not be excluded simply because it has not been previously disclosed. The remedy in such a situation is to provide a party with sufficient opportunity to consider the evidence and make submissions on it. The real issue is whether the evidence transforms the dispute into something so different that it is no longer the same as the pre-existing dispute.

Even in the Nuttall case, the judge recognised a party can refine its arguments. It is a matter of detail and degree.

This is a principle properly tested by Judge Thornton QC in Fastrack Contractors v Morrison Construction (2000).

In this case, the main objection to jurisdiction was that the amounts applied for in the adjudication were different from those in the application for payment which gave rise to the adjudication.

Judge Thornton held that the adjudicator correctly decided the additional sums in the submission to adjudication were no more than additions resulting from finalisation of the re-measurement process and the correction of errors.

He held that it is for the adjudicator to identify the nub of the dispute, adjudicate upon it, and dismiss the residue.

The fear that leads parties to contest an adjudicator's jurisdiction when new evidence is brought to light is the fear of ambush - of being caught unprepared by evidence that the other party has deliberately held back. But I suggest that in reality such situations are rare.

Take, for example, Sindall v Solland (2001). The main issue was whether Sindall's employment under the contract had been wrongfully terminated. But to decide that, it was necessary first to decide whether Sindall had been entitled to a further extension of time. This lay at the heart of the dispute and so it was within the jurisdiction of the adjudicator.

The crucial point was that the extension of time information which Sindall relied on had been issued to Solland only seven days before the adjudication commenced. There was a large amount of documentation and very little time to consider it. Was this an ambush?

The documentation Sindall produced was new but the events described within it were not - Solland should have given consideration to them before deciding to terminate Sindall's employment.

That is why the judge held there was no ambush and the adjudicator was right to base his decision on that extension of time information. All Sindall was doing was to build on the issues which the adjudicator would in any case want to consider in reaching a decision.

Key points

The statutory 28-day adjudication period leaves little time for consideration of new evidence. Hence, parties are in fear of an 'ambush'.

It is now common for parties to attempt to exclude from the adjudication any evidence that had not previously been made available to them before commencement of the adjudication.

Evidence should not be excluded simply because it had not been previously disclosed. The real issue is whether the evidence transforms the dispute so that it becomes a completely different dispute.

Where the issues referred to adjudication are essentially the same as those which gave rise to the dispute, the adjudicator has jurisdiction.