For
the purposes of this assignment, it has been assumed by this study that the
third parties have agreed to arbitrate the consolidation of proceedings and concurrent hearings; importantly,
this means arbitration and there would not be a need for the court’s
jurisdiction s. 87.

Arbitration
is described by as a private hearing that is governed by legal process under ss.94 to 98 of
the Arbitration Act (AA) 1996, (RICS, 2017). Although an arbitration agreement
is a contract, nonetheless the agreement may be rejected or terminated.1

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Ordinarily,
some construction contracts incorporate arbitration clause, but then it is
thought that the JCT contract omitted arbitration clause.
(Brekoulakis and EI Far, 2011) preserves that third parties in arbitration may
be involved as a result of a direct liability between the parties.2

In an
event of a dispute, it is prudent that parties seek consent for multiparty
arbitration proceedings, that is, the multiparty arbitration clause must state how
the dispute will be decided judicially by either an “arbitrator” or a panel.
Secondly, parties should state how the agreement procedures will be conducted,
either individually or under one umbrella, (Gard, 2017).

Consequently,
the appointed arbitrator is given immunity by the parties and s. 30 allows the
arbitrator the power to arbitrate and rule on his jurisdiction. In addition,
there must be rules that provide for multiparty claims, for example, Article 17
(5) of UNCITRAL Arbitration Rules 2013.

Importantly,
a
party that commences litigation in court is acting in breach of contract while
(Mustill and Boyd, 1989)3
cautions
that parties must draft the arbitration clause, agree to insert the part of the
 law but the  application only to appeal unless if the
parties consent; however, such clauses must be clear.4

(SFC)
like the NEC contract does not suggest arbitration rules, whereas the ICE
contract has no provisions for rules. (Mustill and Boyd, 1989) explains that multiparty ought to accept
the impartial decision since the arbitrator’s decision is enforceable.

The
advantage being to maintain certainty but the issue arise when there is
ambiguity in the contract.5 The
arbitration process allows parties to run parallel negations proceedings to
reach a settlement, the arbitrator will be informed by the parties and he/she
awards the ‘consent’ award, (Gard, 2017).

Another
advantage of the arbitration, multiparty cannot have parallel hearings with
litigation then again, courts can get involved.6 A
party that commences to litigation in court is acting in breach of contract and
under s.4 of (AA) 1950, the court has discretional powers to refuse a stay of
proceedings (The
Halki).7
Another criticism is that once the stay is in arbitration under Part 8,
multiparty cannot take it to litigation.

Another
shortcoming of this procedure is that the arbitrator cannot force
third parties, he has no such powers.  Granting
the decision made by the arbitrator is binding on all parties, critics maintain
that the arbitrator’s decision, is subject to appeal to the court only on
grounds specified in the Arbitration Act 1996. Notwithstanding, the
strategy has not escaped criticism from academics who maintain that English
arbitration is weakened.

In
terms of timescales the statute of Limitation Act 1980 apply to arbitration and
Litigation s. 34(1), on the contrary, this power is exercised very sparingly.
In light of this the arbitrator’s award can be challenged by parties if the
arbitrator has acted; out of his jurisdiction8s .67 or serious cases of
irregularities s.68 (mandatory).

3. Adjudication and third
parties

 

Adjudication
can play an important role in addressing the issues of construction disputes.
According to (Ndekugri and Russel 2006),9 they
proclaim that the introduction of Statutory Adjudication has changed the UK
construction industry.

It is
believed that, multiparty are involved in Statutory adjudication since the Act
gives rights to parties in a contract to refer anytime to the adjudicator,
while, (Cottam et al 2002)10 upholds
parties may agree on the appointment.

(Cottam
et
al.,
2002) sustains that his/her appointment must be signed by at least one party
before proceeding and be in line with the procedure; perhaps
the most serious disadvantage, if the appointment is not in line11; similarly, if there is
possible of a conflict of interest.12

Although
there is a timetable, proceedings are mandatory. (Brooke 2009; Sidoli Del Ceno
et al 2015) asserts that the decision which is binding on parties pending legal
proceedings and fees and expenses.13  

Assuming
that all parties have received the Notice of the intention to refer. That being
so, challenges arise when the referring party issues a claim and is refuted by
the other party; despite this, they can use defence.14 Consequently, at times
the courts can extent it for substantial information.15  (Skaic, 2017)16  is critical of the tendency challenge the
adjudication determination.

On the
subject of third-party rights, (Bell and Grudzinski, 2014) further criticises the
practicality of multiparty having slim chances of adjudicating, notwithstanding
enforcement clause for adjudication.  One
question that that needs to be asked, however, is whether the insurance
company, funder and subcontractor, are they better suited in adjudication or
arbitration.

Returning
briefly to the issue of enforcement clause, the existing accounts fail to
resolve the contradiction between the cases of Hurley Palmer Flatt Ltd v.
Barclays Bank plc & Parkwood Leisure Ltd. v. Laing O’Rorke Wales and West
Ltd. Many analysts (Brooke 2009; Sidoli Del Ceno et al., 2015; Skaic 2017) now
argue that the strategy of adjudication has been called into question.

Difficulties
arise, however, when an attempt is made to implement the adjudicator’s ward;
critics such as Skaic (2017) point out those delay tactics by responding
parties and challenging the adjudication determination. Although disputants may
resist the enforcement it has to be a plain one the court expect, for example;
the adjudicator did not have a jurisdiction, breach of natural justice. 

1Delta
Reclamation Ltd v. Premier Waste Management Ltd 2008 EWHC 2579 QB

2Smith
v. Johnson Bros 1954 1 DLR 392

3 Mustill,
M.J. and Boyd, S.C (1989) Commercial Arbitration, Butterworth, 1989

4 Trafalgar
House Construction v. Railtrack 1995 75 BLR 55.

5Lafarge
Redland Aggregate Ltd v. Shepherd Hill Civil Engineering 2001 1 WLR

6Scot
v. Avery (1856) 5 HL Cas 811

7Halki
Shipping Corp v. Sopex Oils 1998 1WLR 726

8
Broda Ago Trade (Cyprus)Ltd v. Alfred C. Toepfer International Gmbh (CA)

9 Issaka
Ndekugri, Victoria Russell, (2006) “Disputing the existence of a dispute
as a strategy for avoiding construction adjudication”, Engineering,
Construction and Architectural Management, Vol. 13 Issue: 4, pp.380-395

10 G.
Cottam, M. O’Reilly, and E. Ryan (2002) Proceedings of ICE, Civil Engineering
150 Pages 75-80

11 Lead
Technical Services v. CMS Medical2007 EWCA Civ 316

12 Eurocom
Limited v. Siemens Plc2014 EWHC 3710 (TCC)

13 Kitt
& Arnold v. The laundry Building Ltd & Anor 2014

14 Mailbox
(Birmingham) Ltd v. Galliford Try Building Ltd2007 EWHC 1405

15 Cantillon
Ltdv. Urvasco Ltd2008 EWHC 288 (TCC)

16 Samer
Skaik, (2017) “Operational problems and solutions of statutory complex
adjudication: stakeholders’ perspectives”, International Journal of Law in
the Built Environment, Vol. 9 Issue: 2, pp.162-175