One year on: The positive impact of low value adjudications

April 2021 marks a year of RICS offering low value adjudication services helping small businesses in the construction industry. RICS low value adjudication falls under the Construction Industry Council Low Value Disputes Model Adjudication Procedure (LVD MAP). The service is also compliant with the Construction Act and enables businesses to resolve disputes where the claim is for £50,000 or less. It is proving to be a popular, well-used service. Since launching last year, over 200 parties have engaged into the process with over 100 adjudicators nominated by RICS. 

2020 was an immensely challenging year for construction industry. Cash flow became critical and increasing numbers of disputes about payment were in danger of impacting businesses to the extent many were at risk of collapse. There was a need to help businesses particularly small to medium-sized enterprises (SMEs) to resolve disputes by providing access to cost-effective adjudication. RICS Dispute Resolution Service adapted its offerings to support by delivering affordable options for resolving non-complex disputes by:

• setting clear and easy to understand procedures - leading to adjudication decisions being made within 28-days as initially intended by Parliament.
  
• straightforward submissions - the amount of documentation presented to the adjudicator is limited.
  
• cost effectiveness - providing clarity for parties about how much they will pay and ensuring that costs are sensible and affordable.  
  

Nominating knowledgeable, highly skilled dispute resolution professionals, RICS Dispute Resolution Service has two services available:

• The low value service is designed for matters where the amounts claimed in dispute are £50,000 or less.
  
• In further response to the specific needs of the industry at the smaller end of the SME scale, RICS also offers a Summary Adjudication service for claims below £20,000.
  

Both services are compliant with the Construction Act, offering a 28-day decision. The summary adjudication is normally at little, and in some circumstances at no, cost. Both services proactively offer support to businesses that may be compromised in these challenging times

• Find out more about our adjudication services

How can RICS low value services help clients?

Stephen Pilling of Quantum Consult used the service over the last 12 months and said:

“On low value disputes, our clients look for reassurance that costs will be proportionate – and the RICS low value service helps this. The benefit is that it coveys, right from the outset, that the dispute procedure will be perceived as rudimentary. The Adjudicator’s were purposive in respect of the procedure rules. The limitations meant that the Adjudicators sought even greater efficiencies – both ordering a document only process for the parties to agree”.

Ian Lawton of IML Consulting (UK) Ltd also spoke about how RICS’ low value adjudication services helped his client:

“The main benefit for using the low value adjudication service is the certainty of the Adjudicator’s fees. Therefore, I would always recommend the use of this service on any dispute where the amount in contention is less than £50,000.00.

"I have used the RICS dispute resolution service on several occasions and the fees charged by the nominated Adjudicator can vary this model provides the parties with a degree of certainty of the fees they might be responsible – win or lose. I would always defer to the RICS in that their response to the appointment of an Adjudicator is both timely and efficient”.

To ensure credibility, RICS have a high-quality panel of RICS adjudicators who have been trained to deliver the low value adjudication services. RICS Panellist Peter Vinden of Gately Vinden Limited explains why he chose to support the service as an adjudicator:

“I agreed to the support the RICS with the LVDMAP because I have been undertaking adjudications for the RICS for 22 years. It was simply time to give something back to the UK construction industry which I care about. It is also true to say that whilst I am happy to undertake the very large complex adjudications, it is also good to intersperse these with smaller disputes .

"The appointment procedure was clear, fast and efficient. The party representatives restricted the size of their submissions. They also complied with my directions restricting submissions to a referral, a response, and a very concise and limited reply.

"I am used to operating under different procedural rules and I found the process clear and easy to follow. I hope that party representatives continue to use this responsibly. If they continue to do so, RICS low value adjudication services will be a great success”.

If you or your client have an adjudication suitable for the low value adjudication services and want to consider this option, download an application form or email us to find out more. 

• Gemma Beasley, Head of DRS Operations & Appointments at RICS