A thematic analysis of experts' perceptions of critical challenges to effective statutory adjudication implementation

Abstract

PURPOSE Default payment either in the form of delayed payment or non-payment remains a lingering issue affecting the construction industry supply chain. The payees’, which are mostly contractors and subcontractors at the lower rung of the contractual chain face financial difficulties from main contractors who delayed or refused payment in the knowledge that court and arbitration proceedings are often too expensive and a slow remedy for, particularly, the smaller contractors. These oppressive acts have led to insolvency of many lower-chain players and as such generated serious concerns within the construction industry. Consequently, several countries around the globe have introduced payment and adjudication legislation to provide parties with the right to payment and further allow a swift and cheaper means of resolving construction disputes by way of adjudication. Similar legislation is about to be promulgated in the South African (SA) construction industry. However, previous studies revealed that the effectiveness of statutory adjudication could be undermined when there are challenges. Thus, this paper reports the experts’ perceptions on the critical challenges that can impair the effective statutory adjudication implementation, highlights the causes of those challenges and finally suggests potential approaches to prevent the identified challenges. DESIGN/METHODOLOGY The study which is reported upon in this paper generated open ended questions which require novel answers from the experts that are directly involved in the adjudication implementation process. Thus, the study employed a qualitative research approach in both the collection and analysis of data. Data for the study were collected through Skype TM interviews with 15 experienced and seasoned professionals who have had direct interaction with the statutory adjudication implementation in four selected jurisdictions namely: (i) The United Kingdom, (ii) Australia, (iii) Singapore, and (iv) Malaysia. FINDINGS The study revealed that challenges which could impinge the effectiveness of the legislation supporting statutory adjudication ranges from lack of familiarity with the legislation itself, to issues relating to the contents of the legislation, cost of adjudication and adjudicator’s fees, inadequate knowledge of process and procedure of adjudication by the users, jurisdictional challenges, capacity challenges and legal technicalities challenges. The perception of the participants is that some of these challenges arise from poor drafting, court interference and adverse court decision, drafting inconsistency and low level of knowledge. The study finally highlighted the possible ways of avoiding the identified challenges such as raising awareness of different industry stakeholders, adequate training for adjudicators and institutional interventions. ORIGINAL/VALUE OF PAPER This study adds to the body of knowledge by providing empirical evidence which addresses some of the gaps identified in the literature re g a rd i n g t h e i s su e re l a t i n g to e ffe c t i ve implementation of statutory adjudication. The application of proposed means of avoiding the identified implementation challenges would positively lead to the effective operation of statutory adjudication practice in the SA construction industry and may also serve as a guide to other jurisdictions contemplating introducing statutory adjudication.