Developments in the United Kingdom Dispute Resolution Process

Abstract

It is generally recognized that the U.K. construction industry is associated with low profit, delay in payments, cash flow concerns, short-term relationships compared with other industries, and high levels of business failure. In particular, claims and disputes have proliferated in the industry largely due to unfair payment practices. Therefore, to encourage a swifter and more economic method of resolving construction disputes by way of adjudication, the U.K. Housing Grants, Construction and Regeneration Act 1996 (HGCRA) came into force on October 1st, 2011in England and Wales, and November 1st, 2011 in Scotland. This study presents the HGCRA 1996 Act—highlighting its strengths and weaknesses—along with the new 2009 Construction Act. The study additionally presents awareness of the new Act, key reasons for amending the HGCRA 1996 Act, and the impact of key changes in the Act on the dispute resolution process. The paper concludes that the new Act is perceived as being more effective at improving cash flow in the construction supply chain and is expected to encourage parties to resolve disputes by adjudication—but it will have to overcome the historical fact that integration of such proposed changes in construction may be a complex issue.