The Response – What to include?

In this episode, our hosts discuss what makes an effective Response? What are the practical steps a respondent should take? And what common mistakes can be avoided?

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Episode Transcript:

David Owens:

Hi and welcome to episode four of Inside Adjudication. I’m David Owens, a Partner in the Construction Team here at Sharpe Pritchard, and I’m joined by my colleagues Aanya Gujral and Peter Jansen.

In this episode, we’re talking about the Response which is issued by the party defending the adjudication and what it should include.

So, over to you Peter.

Peter Jansen:

Thanks David.

Well, the first and most important thing to know is how little time you have. Neither the Construction Act, nor the Scheme for Construction Contracts expressly specify when a response must be served in adjudication proceedings, but it is generally the case that the responding party is entitled to serve a response within the timescales imposed by the applicable adjudication procedure or the adjudicator’s directions.

That timescale is often just seven, or in some cases where perhaps the dispute is particularly complex, fourteen days after the Referral arrives. So, when you are dealing with detailed documents and a tight timeframe, everyday counts.

Our strong advice is to act immediately. Start reviewing the Referral and the accompanying documents as soon as they land. If you are involved in an adjudication, it helps to coordinate early with your commercial, technical and legal teams so responsibilities are clear between those who are going to be involved in the case from the outset.

Aanya Gujral:

Yeah, that’s right Peter, and you and I both know how tight these turnarounds can be. We both recently worked on a very tight turnaround with having to get something done in a very short timeframe, and it is very true to say that everyday does count.

So, as you said, the Response really is the responding party’s one shot to address the claim that’s being progressed by the referring party. If you have jurisdictional objections, they will need to go in the Response even if you have raised these at the point of receiving the Notice of adjudication. So, examples of jurisdictional objections that might come about, we’ll discuss briefly later in this episode. But we will go into this in more depth in a later episode, which is dedicated to an adjudicator’s decision and when it can be challenged.

If you have a defence on the facts, legal arguments, a counterclaim or evidence that undermines the claim that’s being made against you, this is the time to put it forward in your response. The adjudicator will not usually come back with questions later. So, again as I say, this is your one shot to really address the claim in full. The adjudicator will make their decision usually based on the documents in front of them, and that will normally be the Referral and the Response. But in some cases, there’s also further submissions such as a reply and a joinder, and sometimes that does go on further.

Peter:

You do not need to respond to every single footnote or side comment in the Response. But you do need to clearly address the core dispute. The Responding party has the freedom to include any of your other defences they think will cast doubt over the contents of the Referral and its merits.

In terms of the Response structure, this will depend on the nature of the dispute and how the Referral has set out its arguments. It might be that the Response responds to specific paragraphs of the Referral. This will then allow the adjudicator the ability to easily identify the opposing positions.

In other cases, it may be best to set out what aspects of the Referral you agree to but then put forward the defence with no minimal reference to the Referral. Any response will need to deal with why the arguments in the Referral are refuted with reference to the contract and other evidence to support your position.

Aanya:

Absolutely. And the way the Response is presented also matters. The primary aim of the response is to persuade the adjudicator that your position carries more merit than the Referral does. The responding party will be there to cast doubt in order that the balance of probabilities swings in the responding party’s favour.

Sometimes responding parties can fall into the trap of thinking they are responding to the referring party themselves, and the response can lose its way as individual minor points are argued. If your Response is disorganised or overly aggressive, it can also work against you.

So, our advice is to keep it simple and easy to navigate. Use headings, include a contents page if needed, attach appendices with clear labels, and if possible, include a brief chronology assuming any chronology included in the Referral is disputed. These are practical things that can make a real difference.

At Sharpe Pritchard, we often help our clients with preparing these responses and, as I mentioned in the previous episode, it’s paramount to get early legal advice if you do get presented with a Notice of adjudication.

Peter:

One question we get a lot is whether to include witness statements. The short answer is yes, if they genuinely support your position. For example, if the claim relates to defects or delay, a short statement from a project lead or QS can help to explain what really happened onsite. But avoid going overboard. The evidence should be focused and relevant, not a data dump.

It is also easier for the adjudicator if you cross refer to the Referral bundle rather than duplicating documentation from the Response.

Aanya:

Yeah they’re all really good points Peter, and also, going back to my point earlier, that if you are raising a jurisdictional objection, for example if you believe the dispute has not crystallised or the that Referral goes beyond the scope of the Notice of adjudication, you need to be very clear in your response that that is the case. You need to set out your reasons in full and say explicitly that your participation is without prejudice to your jurisdictional objections. That protects your position if the matter goes to enforcement later.

You’ll also have to prepare a letter to the adjudicator. Peter, could you explain a bit more about that?

Peter:

Parties should not rely on jurisdiction alone. Because if you were to confine your case to argue jurisdiction and then you lose, you could end up with an enforceable decision against you that you have not properly contested or prepared for. And the reality is that most adjudicators like to focus on substantive issues to decide cases based on the merits. They are put off by jurisdictional challenges and tend to see them as an attempt to subvert the crisis by technical arguments.

So, unless you are absolutely sure the adjudication is invalid, we strongly recommend responding on the merits as well.

Aanya:

Yes, that’s very true. Another point on that is that it’s usually advised to also reserve you rights and reserve your position, to later bring a jurisdictional challenge if you are the responding party, because that will also be something that the referring party can then not pick on if you do later decide to bring a jurisdictional challenge up in a later submission in the adjudication. So, it’s another practical point to think about.

But looking more practically in general, one of the main things that you need to consider when preparing your response, is to be strategic. Focus on the key issues that are being alleged in the referral. Focus on what the claim is really about. What remedy is being sought by the referring party, and why do you think as a responding party is it not justified? Try to keep your arguments rooted in the contract, the evidence, and the facts that are available.

David:

Thank you both. That was a really helpful explanation of the Response process and what you should be thinking about when you are facing a Referral.

Before we finish, can we summarise a few takeaways.

Peter:

Start early, is the main one. There is no time to waste. Adjudications move fast and so should you.

Aanya:

Second, stay focused. You do not need to challenge every single point in the Response; you just deal with the heart of the dispute clearly and accurately.

Peter:

Thirdly, coordinate with your legal advisers from day one. At Sharpe Pritchard, we are often asked to advise on and prepare Responses, and we have seen how a well-prepared document can make all the difference to the outcome. If you are facing a Referral, it is worth getting support to ensure your Response is robust, relevant and properly presented.

David:

Thanks both.

Before we wrap up today, we have a case law update to run through with you, this time on natural justice. Natural justice, which we will cover more in a future episode, is a common ground for challenging an adjudicator’s decision, but in practice as we’ve said, those challenges don’t often succeed.

This next case is a good example of that, and it also reinforces the importance of reserving your position, as Aanya said earlier, if you think something has gone wrong. It gives us a useful insight into procedural fairness and how the courts treat allegations of bias.

Peter, can you talk us through it?

Peter:

So, this is the case of Essential Living v Conneely Facades Ltd [2024]. Conneely challenged the adjudicator’s award on grounds of apparent bias and predetermination, and that case was based upon a procedural ruling where the adjudicator referred to Conneely’s, what he referred to as a “fanciful”, double‑recovery argument. And on that basis, when the ultimate decision was issued and Essential Living sought to enforce it, Conneely belatedly raised the position about bias.

The court found the adjudicator had in fact given Conneely full opportunity to make its case, and after reviewing materials, Conneely had then dropped that argument. Moreover, by paying the adjudicator’s fees without reservation, Conneely was found to have waived its right to challenge. The court then called the challenge “unmeritorious” and awarded indemnity costs against Conneely.

So that’s an object lesson in exercising extreme caution before deciding to go ahead with a challenge based upon grounds of natural justice. And there needs to be real evidence of genuine bias, which was undermined by Conneely’s own conduct in this case.

Aanya:

Yeah, that’s completely right and just disagreeing with how the adjudicator has handled something isn’t enough either.

Also, if you think there’s been a procedural issue, don’t just carry on as normal, make sure you reserve your rights clearly, especially when paying the adjudicator’s fees. If you don’t, the court might say that you accepted the process, and you could lose the chance to challenge later.

David:

Thank you both, that brings us to the end of another episode of Inside Adjudication by Sharpe Pritchard.

Thanks again to Peter and Aanya for this episode.

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We look forward to joining you for the next episode of Inside Adjudication.