Adjudikation
Disputes are a thing of the past – today, solutions are found.
In the German construction industry, adjudication primarily refers to the out-of-court settlement of disputes between contracting parties. This process is carried out by one or more adjudicators who act neutrally towards the parties and possess shared expertise. The expert office Holzmann-Bauberatung®, in collaboration with renowned specialist lawyers for construction and architectural law, offers a Dispute Adjudication Board. This board, with its construction experts, thoroughly examines both the technical aspects and the relevant legislation to develop a fair and realistic solution together with the parties.
Multi-causal and complex disputes are common in the construction industry. Therefore, in almost every case, a technician and a lawyer are involved in resolving the issue, as it ultimately affects all parties. In this context, the technician and lawyer form a Dispute Adjudication Board that comprehensively examines and investigates the specific problem.
It is advantageous to regulate the adjudication procedure by incorporating it into or concluding the construction contract. This allows for legally sound, but above all, individually tailored agreements that can be formulated appropriately for each specific case.
Adjudication, with its interpretation already determined by the time construction is completed, generally leads to a significantly more stable construction process. In addition to project-accompanying adjudication agreed upon at the start of construction, the procedure can also be initiated only when a dispute arises. In the case of construction disputes, this procedure regularly reduces or eliminates considerable construction delays and/or cost increases caused by protracted and often unnecessary litigation. A construction project can be brought to a standstill for several months, and not infrequently even several years, if positions harden and legal proceedings drag on. It is certainly common knowledge that cost increases due to standstill in the construction industry can reach dramatic proportions.
If an adjudication team, comprised of experts working neutrally between the parties, is commissioned in advance to jointly resolve problematic cases with all involved, disputes concerning defects, for example, can be quickly addressed and usually resolved just as quickly before costly and lengthy legal proceedings are initiated. Both parties thus receive ad-hoc support on the respective subject matter of the dispute from the expertise of specialists and lawyers.
The costs incurred through adjudication during construction are negligible compared to the costs of typical court proceedings, the usually necessary independent expert assessment by a court-appointed expert, and other costs associated with or caused by the proceedings (e.g., construction delays). Adjudication is often reserved for large projects for cost reasons. However, this view cannot be shared by experts, based on the cases handled by Holzmann-Bauberatung® expert office over more than 26 years. On the contrary, significant cost increases due to disputes regularly occur, particularly during the construction phases of single-family and two-family homes, as well as smaller apartment buildings. Additional costs of several tens of thousands, often hundreds of thousands of euros, and months or even years of construction standstill are not uncommon.
The expert office Holzmann-Bauberatung®, like lawyers, bills for their services based on actual work performed. Because action can be taken during the problem assessment phase, direct solutions can be developed for each specific issue. This ensures that agreed-upon construction goals are not compromised. Ultimately, the property is handed over to the new owner free of defects and to the satisfaction of both parties, allowing for timely and agreed-upon occupancy.
For further information, please feel free to contact us by telephone on (+61) 08 9398 2015.
