Adjudication practice and Its enforceability in the Sri Lankan construction industry

Abstract

Construction activities involve many temporarily assembled multiple stakeholders with multiple interests, which make the process complex. This results in numerous disputes on construction projects. Although various forms of dispute-resolution methods are available, an increased preference toward adjudication over the other methods is seen in many jurisdictions. However, in Sri Lanka it has yet to receive its recognition, and there is no legislative framework to enforce an adjudicator’s decision. This research therefore investigates the effectiveness of the current adjudication practice with the special emphasis on need for its enforceability in the current context. Practitioners’ views were sought using semi structured interviews conducted among 20 experts who constituted two major groups: construction professionals and legal professionals practicing in Sri Lanka. Content-analysis technique was used to analyze the collected views. According to analysis, 71 % (out of 92) of disputes referred to adjudication were unsuccessful where neither party was satisfied with the final outcome. However, 94% of 71% of those disputes were subsequently resolved amicably on the basis of adjudicators’ determination while the remaining 6% were referred to arbitration. This suggests that although adjudication is being practiced as a resolution method, it is not effective in its own right Certain limitations of the adjudication practice in Sri Lanka affected its effectiveness. Key limitations include lack of awareness among industry practitioners, absence of legal ascent, and lack of competent adjudicators to resolve complex disputes. Findings further indicate that the meager enthusiasm among the practitioners toward enactment is due to the inability to ascertain the extent of enforcing and failure to understand the benefits of statutory adjudication. The research therefore suggests that the relevant government bodies need to work toward enactment of statutory adjudication while establishing an appropriate climate for its implementation in Sri Lanka. DOI: 10.1061/(ASCE)LA .1943-4170.0000178. © 2015 American Society of Civil Engineers.