Before commencing adjudication, there must first be in existence a dispute and the dispute must relate to the matters in the payment claim and the payment response.
Further, section 6(4) of the Construction Industry Payment and Adjudication Act 2012 (“CIPAA 2012”) also provided that “A non-paying party who fails to respond to a payment claim in the manner provided under this section is deemed to have disputed the entire payment claim.”
Once a dispute is said to be in existence, either party can commence the adjudication process by referring the dispute to adjudication. Either party may refer a dispute to adjudication after the expiry of 10 working days from the date of the receipt of the payment claim pursuant to Section 7(2) and 6(3) of the CIPAA which stated that:-
Section 7(2) of the CIPAA 2012
(2) The right to refer a dispute to adjudication shall only be exercised after the expiry of the period to serve a payment response as specified under subsection 6(3).
Section 6(3) of the CIPAA 2012
(3) A payment response issued under subsection (1) or (2) shall be served on the unpaid party within ten working days of the receipt of the payment claim.
For the unpaid party, he may refer to adjudication any part of the payment claims which is disputed by the non-paying party. As regards the non-paying party, he may raise the issue or defence such as cross-claims, set-off or abatement.
Pursuant to section 8 of the CIPAA 2012, the Claimant may initiate the adjudication by serving on the other party a written notice of adjudication containing the nature and description of the dispute and the remedy sought together with any supporting document on the respondent.
The written notice of adjudication can be affected by using the mode of services provided under Section 38 of the CIPAA 2012:-
- by delivering the notice or document personally to the party;
- by leaving the notice or document at the usual place of business of the party during the normal business hours of that party;
- by sending the notice or document to the usual or last-known place of business of the party by registered post; or
- by any other means as agreed in writing by the parties.
In addition, Rule 2 of the AIAC Adjudication Rules and Procedures requires the Claimant, upon serving a notice of adjudication on the Respondent, register the adjudication matter at the AIAC by serving a notice on the Director of AIAC.
Disclaimer: This article is for informational purposes only and does not constitute any legal advice. If you have any questions or require further information on this matter, please do not hesitate to contact us directly.