Adjudication has played a role in the resolution of construction disputes in Kenya for a number of years. It is not governed by statute but has largely developed as a result of the adoption of international standard form contracts, especially FIDIC, for both public and private sector projects. Despite this, the most widely used construction contract in Kenya, the Joint Building and Construction Council (JBCC) Green Book (1999 edition), does not contain an adjudication clause.
Adjudication has played a role in the resolution of construction disputes in Kenya for a number of years. It is not governed by statute but has largely developed as a result of the adoption of international standard form contracts, especially FIDIC, for both public and private sector projects. Despite this, the most widely used construction contract in Kenya, the Joint Building and Construction Council (JBCC) Green Book (1999 edition), does not contain an adjudication clause. Addressing this gap in the Green Book was regarded as the number one priority for all those involved in the industry wide consultation on the updating of the 1999 edition. Three years in the making, the next edition of the Green Book is expected to be ready before the end of this year and will contain an adjudication clause which responds to the most critical issue raised by the industry – the need for a clear and practical mechanism for the expeditious resolution of construction disputes.
So what can we expect from the new Green Book adjudication clause? We talked to one of the new Green Book drafting committee members, Simon Kiriba, a construction lawyer working at Bowmans Kenya, about the highlights.
Adjudication will be available as a dispute resolution option at any time during construction, whereas arbitration will only be available following practical completion of the works. Interestingly, there will be a list of matters deemed not to be suitable for adjudication, including disputes relating to e.g. the validity of the contract; the validity of an architect’s instruction; whether or not a certificate has been properly withheld. For these matters, an expedited arbitration procedure will be available at any time.
A single suitably qualified adjudicator will be appointed on an ad hoc basis. It was felt that a standing board would not be required, given the scale and length of many projects typically governed by the Green Book. The selection of the adjudicator will be by agreement of the parties, failing which, a nominating body will decide. The only nominating body specified in the 1999 edition of the Green Book was the Architectural Association of Kenya. A longer list will now be available, enabling parties to go to the “right forum” depending on the specific area of expertise required. The list will comprise: the President of the Architectural Association of Kenya; the President of the Institute of Quantity Surveyors of Kenya; the Chairman of the Chartered Institute of Arbitrators (Kenyan Branch); the Registrar of the Nairobi Centre for International Arbitration; the President of the Institution of Engineers of Kenya; and the Chairman of the Institution of Construction Project Managers of Kenya.
The adjudicator will be required to give his decision within 30 days of the appointment, although this can be increased to 45 days with the consent of the referring party. There is a seven day period for a notice of dissatisfaction to be issued by an aggrieved party, failing which, the decision is final and binding. If a notice of dissatisfaction is issued, the matter is referred to arbitration.
There will be a specific obligation to comply with the adjudicator’s decision (whether interim or final) within 30 days or within the time frame stipulated in the decision. The Kenyan Courts have generally shown a willingness to uphold adjudicators’ decisions, driven by the Constitutional principle (set out in Article 159(2)(c)) that alternative dispute resolution methods and procedures should be promoted. However, the new Green Book adjudication clause will nevertheless provide for an expedited arbitration procedure to be pursued where a final binding decision has not been complied with, enabling the decision to be ratified by an arbitrator within 15
days. A form of expedited arbitration procedure is also anticipated for circumstances where an interim binding decision is not complied with.
Overall, the adjudication provisions in the upcoming revised edition of the Green Book look set to create a solid regime for the fast and effective resolution of construction disputes in Kenya. Due to the popularity of the Green Book, it seems likely that adjudication will grow exponentially in Kenya in the coming years, as the revised edition is gradually adopted across the industry.