Success of adjudication as a primary ADR method in Sri Lankan construction industry

Abstract

Due to the rapid growth of the construction industry and its complexity and multiparty involvement, disputes are unavoidable. Construction industry requires an effective dispute resolution system which has key characteristics like fast and cost effectiveness to avoid unnecessary delays and cost overruns. Litigation as the conventional dispute resolution system has proven that it is not appropriate for construction disputes due to its inherent characteristics. Alternative Dispute Resolution (ADR) mechanisms have been developed to accommodate this requirement to resolve the construction disputes. Adjudication is one of the most significant and well spread ADR method in construction industry. Adjudication has introduced to the Sri Lankan construction industry through Federation Internationale Des Ingenieurs Conseils (FIDIC) standard form of contract and Institute for Construction Training and Development (ICTAD) standard forms of contracts, and recently through Construction Industry Development Act No. 33 of 2014. Purpose of this research was to study prevailing practice of adjudication in Sri Lankan construction industry in terms of applicability, procedure and skill level of professionals involved in the process. Based on that to assess the success of adjudication as an ADR method in the Sri Lankan construction industry and to finally find an answer whether the industry is getting full potential of adjudication to resolve the construction disputes. The findings of the study reveal that though adjudication is widely used, the industry does not receive its full benefits.