To err is human and, to the best of my knowledge, property professionals fall within that classification.
However, a recognised problem with professional negligence claims is the cost and delay of litigation. The Ministry of Justice has therefore been trialling a voluntary adjudication scheme for professional negligence claims where the damages are up to £100,000.
Property people may be familiar with the concept of adjudication from construction disputes. The procedure has been around for many years and is tried and tested in that field.
Essentially adjudication is what might be described as a “quick and dirty” means of addressing a dispute, which creates an enforceable decision that may, however, be the subject of court proceedings if a participating party disputes the outcome. The big selling point is that the losing party in the adjudication must pay the other party according to the adjudicator’s award in the meantime. Very often the adjudication is accepted by the parties and finally decides the dispute.
Under the procedure, an adjudicator is appointed and charged with deciding the dispute on the facts and according to the law within 56 days after the date of his appointment (though this timescale may be extended by agreement of the parties).
The adjudicator will give directions regarding evidence and submissions and can take the initiative in requesting documents or other information. The process must comply with the principles of procedural fairness. The adjudicator can also award costs. The adjudicator’s decision must be in writing and give reasons for the outcome. The whole process is private and confidential except for the purposes of enforcement or in subsequent proceedings.
If necessary the decision will be enforceable by a summary judgment application in the County Court and can only be defeated if there is a jurisdictional challenge or procedural unfairness. It will not be a defence that the adjudicator erred in fact or law. The incentive for the losing party to pay up without such enforcement being necessary is the saving of the court fee and further costs and the absence of publicity.
The parties can agree that there is a residual right to re-argue the case in full in subsequent proceedings, but the losing party must pay in the meantime.
Given the cost and delay of court claims this is certainly a procedure worthy of consideration in appropriate cases. There is clearly a possibility that adjudication may become available as a compulsory procedure if requested by either party, so watch this space.
Janet Keeley, Partner, Fladgate LLP (firstname.lastname@example.org)