Commencing an Adjudication
What is Adjudication?
For an explanation of what adjudication is and the adjudication timelines, please refer to the following link: Adjudication Process.
For a list of Frequently Used Terms for this website and their definitions, please refer to the following link: Frequently Used Terms.
How Much Does Adjudication Cost?
The cost of an adjudication will vary. The fee is based on the amount in dispute as set out in the Schedule of Fees unless the Adjudicator and the Parties agree otherwise. For a copy of the Fee Schedule, please refer to the following link: Schedule of Fees. The Adjudication Fee may consist of a fixed fee, or an hourly rate multiplied by the number of hours spent by the Adjudicator, plus disbursements and taxes. If the Parties and the Adjudicator agree to a fee that is different from the fee in the Fee Schedule, they need to notify ADACC in writing within two days of the Adjudicator being appointed to the adjudication.
Please note that ADACC does not charge a fee to appoint an Adjudicator.
How to Refer a Dispute to Adjudication
A party to a contract or subcontract who wishes to refer a dispute to adjudication (the “Claimant”) must complete a Notice of Adjudication and provide the Notice to the Party from whom money is alleged to be owing (the “Respondent”) (s. 20(1) of the Prompt Payment and Construction Lien Act). The Claimant must also provide a copy of the Notice of Adjudication to ADACC, as the selected Nominating Authority, by email at authority@adacc.ca.
The steps to start an adjudication are outlined below.
Step 1: Assess if the Dispute can be Referred to Adjudication
Section 33.4 of the Prompt Payment and Construction Lien Act states:
(1) A Party to a contract or subcontract may refer to adjudication a dispute with the other party to the contract or subcontract, as the case may be, respecting any prescribed matter in accordance with this section and the regulations or the procedures established by the Nominating Authority responsible for the matter.
(2) An adjudication may not be commenced if the notice of adjudication is given after the date the contract or subcontract is completed, unless the parties to the adjudication agree otherwise.
(3) For the purpose of subsection (2), “date of final payment” means, subject to subsection (4), the earlier of
(a) the date on which complete payment of the amount set out in the contract or subcontract, as applicable, is made, and
(b) the date on which complete payment of the amount set out in the contract or subcontract, as applicable, is required to be made under section 32.2, 32.3 or 32.5, as the case may be.
(4) For the purposes of subsections (2) and (3), “final payment” does not include
(a) payment of the major lien fund,
(b) payment of the minor lien fund, or
(c) payment for any work done or material furnished
(i) after the certificate of substantial performance is issued, or
(ii) in a case where a certificate of substantial performance is not issued, after the work to be done under the contract or subcontract is capable of completion or correction at a cost of not more than
(A) 3% of the first $500 000 of the contract or subcontract price,
(B) 2% of the next $500 000 of the contract or subcontract price, and
(C) 1% of the balance of the contract or subcontract price.
(5) If a party commences an action in court with respect to a dispute on or after the day the dispute is referred to adjudication under subsection (1), the adjudication and the action in court may both proceed unless, on the application of a party or on the court’s own motion, the court directs otherwise.
(6) If the court makes an order in respect of the matter in dispute on the merits of the dispute while the adjudication is still ongoing, the adjudication is automatically terminated.
Pursuant to section 19 of the Prompt Payment and Adjudication Regulation, a Party to a contract or subcontract may refer to adjudication a dispute with the other Party to the contract or subcontract, as the case may be, respecting any of the following matters:
(a) the valuation of services or materials provided under the contract or subcontract, including in respect of a written change order, whether approved or not, or a proposed change order, as the case may be;
(b) payment under the contract or subcontract, including in respect of a written change order, whether approved or not, or a proposed change order;
(c) disputes that are the subject of a notice of non-payment under Part 3 of the Act;
(d) payment or non-payment of an amount retained as a major lien fund or a minor lien fund and owed to a party during or at the end of a contract or subcontract, as the case may be;
(e) any other matter in relation to the contract or subcontract, as the case may be, that the parties in dispute agree to, regardless of whether or not a proper invoice was issued or the claim is lienable.
For disputes involving public works, section 14.4(3) of the Public Works Act stipulates the following regarding the commencements of disputes:
14.4 (3) Notwithstanding anything to the contrary under the Prompt Payment and Construction Lien Act, an adjudication may be commenced any time after delivery of a notice of claim under section 14, until
(a) a determination of the dispute to be adjudicated is made by the Court,
(b) after 180 days have passed since the notice of claim was delivered under section 14, or
(c) a notice is given by the Crown under section 15(1).
Section 14.3 of the Public Works Act describes matters that may not be referred to adjudication as follows:
14.3(1) Subject to section 14.5, a party to a contract or subcontract may refer a dispute to adjudication in accordance with this Act and the procedures established by the Nominating Authority.
(2) Notwithstanding anything in this Act, the following matters may not be referred to adjudication under subsection (1):
(a) any dispute seeking relief other than the payment of a contractor or subcontractor for the provision of labour, equipment, material or services with respect to a public work;
(b) subject to subsection (3), any dispute in respect of a monetary claim valued in excess of the maximum amount referred to in section 9(1)(i) of the Court of Justice Act, exclusive of costs and interest;
(c) any dispute seeking a determination, order or declaration in respect of
(i) the validity of the termination of a contract or subcontract,
(ii) the validity or enforcement of a determination, order or declaration of another decision maker, including a court or an arbitrator,
(iii) any delay or modification of a construction schedule under a contract or subcontract,
(iv) the achievement of any milestone date under, or the completion of, a contract or subcontract, or
(v) the interpretation of any of the following in a contract or subcontract:
(A) a relief event;
(B) a designated change in law;
(C) a remedial action;
(D) a force majeure event.
(3) If the monetary value of a dispute exceeds the amount referred to in subsection (2)(b), the claimant may abandon the part of the claim that is in excess by filing a notice to that effect with the Nominating Authority and the Crown.
(4) Where a notice is filed under subsection (3), the claimant forfeits the excess part of the claim and is not entitled to recover that excess part of the claim in the adjudication or in any court or arbitration.
(5) If a party commences an action in court, or an arbitration under the Arbitration Act, with respect to a dispute referred to adjudication under subsection (1), the adjudication, action in the court and arbitration may all proceed unless the Court directs otherwise.
(6) If the Court makes an order in respect of the dispute on the merits of the dispute while the adjudication is still ongoing, the adjudication is automatically terminated.
In addition, section 14.5(2) of the Public Works Act states the following:
(2) Sections 13.1 to 13.5 and 14.1 to 14.4 do not apply in respect of
(a) a capital asset upkeep contract,
(b) a special scope contract, and
(c) any contract or subcontract related to a capital asset upkeep contract or special scope contract.
FAQ: Will ADACC decide whether a dispute may properly be referred to adjudication?
No. ADACC will not administratively decide whether a dispute may properly be referred to adjudication. A Claimant may commence an adjudication and, as part of the adjudication process, request that the Adjudicator determine whether the Adjudicator has jurisdiction to decide the issue. A Respondent may also ask an Adjudicator to decide whether the Adjudicator has jurisdiction to decide the issue. An Adjudicator can make a determination regarding whether they have jurisdiction or not.
FAQ: I entered into a contract before the amendments to the Act came into force. Can my dispute be adjudicated?
Information on the transitional provision is available at: Transitional Provision.
For further assistance determining what law applies to a construction project, please consult a construction lawyer.
Step 2: Create a Notice of Adjudication
When ADACC is selected as the Nominating Authority, a Claimant can complete an ADACC Notice of Adjudication form to commence an adjudication. A fillable PDF version of the Notice of Adjudication can be found here: Notice of Adjudication Form. A Notice of Adjudication is required to include the following information:
(a) the names and addresses of the parties in dispute,
(b) the nature and a brief description of the dispute, including details respecting how and when it arose,
(c) the nature of the redress sought,
(d) the name of the Nominating Authority (ADACC) to whom the party serving notice intends to submit the notice, and
(e) the name of the adjudicator requested to conduct the adjudication, if any.
Step 3: Give the Notice of Adjudication to the Respondent
Pursuant to section 20(1) of the Prompt Payment and Adjudication Regulation, the Claimant is required to provide the Notice of Adjudication in writing to the Respondent.
Send 4: Send a Copy of the Notice of Adjudication to ADACC
ADACC must be provided with a copy of the Notice of Adjudication on the same day as it is given to the Respondent. The Claimant can send a copy to ADACC via email at authority@adacc.ca (all other Parties must be copied on the email).
Upon receipt of the Notice of Adjudication, ADACC will assign a Case Number to the adjudication which will be provided to the Parties via email from authority@adacc.ca.
FAQ: What is ADACC’s filing deadline?
Documents submitted to ADACC after 4 p.m. mountain time or at any time on a Saturday or a holiday shall be deemed to have been submitted on the next day that is not a Saturday or a holiday.
FAQ: Can a Notice of Adjudication be amended after it has been created?
The Act and the Regulation do not provide a mechanism for amending a Notice of Adjudication. If a Claimant made an error when filing out the Notice of Adjudication, the Claimant should email authority@adacc.ca for further information.
