Can a Part 36 offer be made in the construction adjudication system?

The primary reason for establishing the construction adjudication system was to effectively provide a form of “fast track” resolution for disputes within the industry. It was implemented to safeguard excessive delays in work and to protect the cash flow position of all parties involved. This is different from how most would understand how the law – in particular courts – usually work, with a dispute taking months if not years to resolve.

Whilst the focus of a construction adjudication process is to find a fast yet fair resolution to a dispute, it does not happen to the exclusion of actions by either party to try and reach an agreement. This is to say that once the process has started it is not the case that the parties involved must wait for the concluding results to be given. A Part 36 offer, for example, may still be presented and heard.

In broad terms, a Part 36 offer is when either the claimant or the defendant sets out what they would either accept or offer as a settlement. Provision for it is made under the Civil Procedure Rules and, as such, is made without prejudice. Part 36 offers may be made at any time up to the delivery of a judgement so long as the offer complies with all technical and legal requirements.

With the intention of construction adjudication being to bring about as fast a resolution to a dispute as possible, there is always the danger of assuming that once it has started it cannot be stopped. The truth is any action which is intended to bring about a quick and legal resolution is welcomed in terms of the expressed purpose of the process.

At Amison Dispute Resolutions we have been involved with several construction adjudication processes in which a Part 36 offer has been made or received by those we represent. We would, as with all aspects of this form of alternate dispute resolution, advise our clients on the merits of these offers.

It is widely known across the industry that the results of a construction adjudication process are binding. This is to say that all parties involved are compelled to act in accordance with the findings, irrespective of whether further arbitration or litigation is to be pursued. It is important to note that the process does remain dynamic, and an action such as a Part 36 offer may be made in order to bring about an amicable resolution.