N DETERMINING an adjudication application, the adjudicator is required to: (a) allow the Respondent a limited time for an adjudication response prior to deciding an application and not consider a response submitted outside the time allowed; (b) decide the adjudication application as quickly as possible and in any case within the earlier of 10 business days of: receiving a response, or the date on which the adjudicator should have received the response. Subject to any further agreed time allowed by the parties; (c) consider requesting further submissions including setting deadlines for submissions, calling a conference of the parties and carrying out an inspection of the work. However, an adjudicator is not obliged to do any of this.

The Act sets out matters that exclude an application from being considered by an adjudicator such as: the contract must have been entered into after 1 October 2004; a contract that forms part of a loan agreement, a contract of guarantee under which a recognised financial institution undertakes to lend or to repay an amount lent, guarantee payment of amounts owing or lent or provides an indemnity relating to construction work carried out or goods and services supplied under a construction contract; a domestic building contract with an owner who is resident or intends to reside in the premises; a contract where it has been agreed that payment is to be calculated by a method other than reference to the value of work carried out or goods and services supplied; where work has been carried out by an employee of the party liable for payment; provisions in a contract under which a party carries out work or supplies goods and services as a condition of a loan agreement with a recognised financial institution; provisions in a contract under which a party undertakes to lend or repay amounts lent, guarantees payment of an amount owing or amount to be repaid; or provides an indemnity relating to the work under the contract; applications must relate to payment claims for construction work in Queensland.

If the adjudicator is satisfied that these preconditions are met, he may proceed to decide the value of the progress payment that is due to be paid (if any), the due date for the payment and the rate of interest payable on outstanding amounts. In order to value the progress payment, the adjudicator is likely to adopt the following process: Identify each separate item that makes up the total claim; For each item, decide whether the claimant has identified a contractual entitlement to be paid under the contract, and consider any submissions the respondent has made as to why no such entitlement exists; If satisfied the claimant has a contractual entitlement to be paid, consider whether the evidence produced by the claimant and the respondent show that the requirements for the relevant contract provision have or have not been satisfied; If the evidence establishes that the claimant has an entitlement to payment, then the adjudicator will proceed to value that work. The adjudicator will consider any evidence the claimant and the respondent have properly put forward on this issue; Value all items claimed in the payment schedule by the Respondent as back charges or set-off amounts that can legitimately be deducted under the contract from payment due.

By John Savage, Registered Adjudicator, IAMA.

Source: Construction Contractor