Adjudication is a swift and cost-effective alternative dispute resolution mechanism used in the construction industry in Ireland. The Construction Contracts Act 2013 (the 'CCA') provides that parties have a right to refer a dispute to adjudication where it concerns a payment arising under a construction contract. It is essential that parties to construction contracts know how to navigate this process. 

In the construction industry, disputes, particularly regarding payments, are not uncommon. These disagreements can stall projects and create significant financial strain. To address such issues efficiently, the CCA offers a structured resolution mechanism known as adjudication. 

Adjudication is a fast-track dispute resolution process tailored for the construction sector and specifically focuses on payment disputes. It is designed to provide a quicker resolution compared to traditional litigation, with the aim of maintaining project timelines and relationships. Adjudicators operating under the CCA are governed by a detailed Code of Practice (the “Code”). The Code ensures transparency and fairness and sets out the responsibilities of adjudicators and the procedure to be followed throughout the adjudication process. 

Commencement of adjudication 

The High Court in Connaughton v Timber Frame Projects Ltd recently confirmed that the right to refer a dispute to adjudication is confined to circumstances where the dispute relates to a payment, i.e. the referring party must either be asserting or resisting a claim to be paid an amount which is provided for under the construction contract. This is a pre-requisite to a valid referral to adjudication.

Where there is a payment dispute, the adjudication process can be initiated by a party to the construction contract (known as the 'Referring Party') issuing a written Notice of Intention to the other party (the 'Responding Party'). This notice must set out, amongst other things, the relevant details to identify the construction contract and any relevant details about the payment dispute. 

Section 10 of the CCA provides that the parties to a construction contract may agree on the manner by which notices under the CCA are to be delivered. Absent such agreement, notices are to be delivered by post or by any other effective means. In the recent case of Tenderbids Ltd v Electrical Waste Management Ltd, the Notice of Intention had been sent to the respondent by way of email. However, the Notice of Intention was not delivered in the manner which had been agreed between the parties under the express terms of the construction contract, i.e. by registered post. 

The court held that it was not permissible to displace the clear language of Section 10 and that the legislation requires that the parties’ choice as to mode of service be respected. Due to the Notice of Intention not being delivered in the manner prescribed under the construction contract, the court held that the entire adjudication process (and thus, the adjudication award) was a nullity. This case stands as a cautionary warning to ensure Notices of Intention are served in accordance with Section 10 of the CCA, and by virtue of that section, in accordance with the terms of the construction contract. 

Appointment of the adjudicator

There are two ways in which an adjudicator can be appointed. The first is by agreement of the parties. This approach allows the parties involved in the payment dispute to appoint an adjudicator by mutual agreement within five days of the Notice of Intention being served. The chosen adjudicator can be someone specified in the construction contract, a person from an established Panel, or another suitably qualified individual. Before accepting the appointment, the prospective adjudicator must request the parties to disclose any potential conflicts of interest and in turn, provide their proposed terms, including fees and expenses. If no conflicts are disclosed or they are deemed frivolous, the adjudicator can formally accept the appointment. 

If no agreement is reached between the parties, a party can apply in writing to the Chairperson of the Construction Contracts Adjudication Panel to appoint an adjudicator from the Panel. Following on from the expiry of the terms of the previous Panel members, recruitment to the Panel is currently ongoing (with the application process having closed in February 2026). The chairperson, Mr Bernard Gogarty, is currently the only member of the Panel, which is inhibiting this method of appointment at the moment. 

Under normal circumstances, an application to the Panel must be made at least five days after the Notice of Intention has been served and should include detailed information about the dispute and the construction contract. The Chairperson, after receiving the application and requesting further clarifications (where necessary), will appoint an adjudicator and notify the parties. 

In both scenarios, the appointed adjudicator must ensure:

• they can give the adjudication the time and attention that both parties are reasonably entitled to expect;
• they are competent to determine the issues in the dispute; and 
• that there is no conflict of interest between them and any of the parties involved in the construction contract.

The appointment process is finalised when the adjudicator's acceptance is communicated to the parties and recorded by the Construction Contracts Adjudication Service. 

Procedures and decisions

Once an adjudicator is appointed, the Referring Party must formally refer the payment dispute to the adjudicator (the 'Referral') and at the same time, provide a copy of the Referral to the Responding Party. The Referral should include relevant details concerning the payment dispute, such as the amount in dispute, the site location, a copy of the Notice of Intention, and a copy of or relevant details identifying the governing construction contract. 

Under the CCA, a Referral is to be made within seven days of the adjudicator’s appointment. In McGill Construction Ltd v Blue Whisp Ltd, while the court did not consider it necessary for the purpose of those proceedings to determine whether a failure to make a Referral within seven days was fatal to the validity of the adjudication process, it did conclude in that case, that a supposed failure to furnish the appendices to the Referral within seven days of the date of the appointment would not have invalidated the Referral. That conclusion was reached on the basis that it is a question of fact in any particular case as to whether the material which has been furnished to the adjudicator within the time limit, is sufficient to constitute the making of a Referral. Out of an abundance of caution, Referring Parties should ensure that all relevant documents, such as a copy of the construction contract, accompany their Referrals.  

Section 6 of the CCA provides that a party to "a construction contract" has the right to refer a payment dispute to adjudication where it arises under "the construction contract". While the High Court in McGill Construction Ltd determined that there is no legislative requirement that there be a separate Referral in respect of individual "payment claim notices", this appears in practice to be distinct to the need for there to be separate Referrals for each construction contract. In other words, multiple payment disputes arising between the same parties across multiple construction contracts, should be brought by a separate Notice of Intention and a separate Referral per contract. 

Upon receiving a Referral, the adjudicator will notify the parties of the adjudication's commencement date and outline the procedures to be followed, including timelines and document length limits. When considering the dispute, the adjudicator is to observe the principles of procedural fairness, which includes giving each party a reasonable opportunity to put its case to, and respond to, the other party.  

Notably, the recent case of Tenderbids Ltd v Electrical Waste Management Ltd addressed an adjudicator’s obligation to deploy fair procedures. In that case, the court had to determine whether a respondent’s failure to respond to a payment claim notice (as per Section 4 of the CCA) could give rise to a "default direction to pay". The High Court held that the adjudicator had erred in law in determining that the employer’s failure to deliver a response to the payment claim notice had triggered an entitlement on the part of the contractor to payment in full for the amount specified in the payment claim notice. The court confirmed that the CCA does not provide for a default direction to pay, which, if adopted, would have the practical effect of preventing the paying party – who failed to respond to a payment claim – from defending a claim in adjudication on the merits. Such an approach would cut against the general principle of natural justice that a party, who will be adversely affected by a decision which is enforceable under statute (even if only on a provisional basis), would normally be entitled to be heard on the merits. 

In short, it was not open to the adjudicator to derogate from fair procedures. With that being said, parties should not treat this case as a license to ignore payment claim notices. If a party contests that the amount set out in the payment claim notice is due and payable, they are to deliver a response no later than 21 days from the payment claim date. 

The adjudicator has the authority to request additional documents, utilise specialist knowledge, appoint experts, and conduct site visits or inspections as necessary, while ensuring all parties are informed of these actions. Following which, the adjudicator shall reach a decision within 28 days after the dispute has been referred, although this can be extended by up to 14 days with the Referring Party's consent. This decision will be provided in writing and will be signed and dated by the adjudicator. The written decision will include the reason(s) for the decision as well as setting out the allocation of fees, costs, and the expenses specific to the adjudicator (which shall be a reasonable amount). However, the CCA provides that each party shall bear his own legal costs and / or other costs incurred in connection with the adjudication. 

Conclusion

For those working in the construction industry, it is important to keep the CCA and the adjudication process in mind, as adjudication can be a viable alternative to other dispute resolution mechanisms where payment disputes arise. Adjudication is a cost-effective tool for swiftly resolving payment disputes in the construction industry, and its aim is to ensure projects can continue to run smoothly without prolonged disruptions.

For more details on this topic, and if you are considering whether adjudication is a suitable avenue for resolving your dispute, please contact Darragh Killeen and Shannon Fahy in our Dublin office.