Clause 137
Local Democracy, Economic Development and Construction Bill [Lords]
1:15 pm
Nick Raynsford (Greenwich and Woolwich, Labour)
I rise to make two points. First, I very much welcome the provisions of the clause. It closes a loophole that has been used by some parties to try to frustrate the procedures put in place by the 1996 Act to allow adjudication as a relatively quick and low-cost means of overcoming disputes. Where parties insist that the full cost of adjudication is met by the subcontractor, it would provide a serious deterrent to a subcontractor seeking adjudication. This particular device has been deployed to discourage the use of adjudication.
The change here, which makes it unlawful for any agreement on apportionment of costs prior to the appointment of an adjudicator, is entirely sensible. There is, however, an unfortunate by-product. Where there is a need to apportion the costs in order to ensure that the adjudicator is paid, that is not necessarily covered under the new provisions. The Royal Institution of Chartered Surveyors suggests that an amendment should be made to allow for the adjudicator to propose the apportionment of costs between the parties and to ensure that the parties are jointly and severally liable for the adjudicator’s costs.
That seems an eminently sensible proposal. It was advocated in the other place by Baroness Hamwee of the Liberal Democrats. I think the Government undertook to consider it sympathetically, so I am disappointed that there is no Government amendment today.
I have the greatest sympathy for my hon. Friend the Minister who has had to pick up this brief at very short notice and has now been told that she is going to relinquish it almost immediately. I am sorry to bowl her this googly, but would she please tell the Committee whether the Government are sympathetic in principle to the RICS amendment? Would they be willing to accept such an amendment on Report were I to table one, which I am minded to do?