Adjudication during Covid-19 Circuit Breaker Period

On 3 April 2020, the Singapore Government announced that heightened safe distancing measures will be in place for four weeks from 7 April 2020 until 4 May 2020 (i.e. the “Circuit Breaker Period”).  During the Circuit Breaker Period, all business, social, or other activities that cannot be conducted through telecommuting from home will be suspended. Only essential services and their related supply chains and service providers may continue to operate.

This article seeks to address the concerns of whether adjudication proceedings under the Building and Construction Security of Payment Act (“SOPA”) will continue or may be commenced during the Circuit Breaker Period. It also highlights a particular recent and relevant decision in the United Kingdom pertaining to adjudication and the Covid-19 outbreak.

Adjudication applications can still be lodged

The Singapore Mediation Centre (“SMC”), being the authorised nominating body to manage adjudications under SOPA, has issued a notification that their services remain unchanged during the Circuit Breaker Period. Parties may continue to file their adjudication applications at SMC’s physical counter located in the Supreme Court.

On 15 April 2020, SMC issued their Supplementary Rules for Electronic Adjudication Lodgment (the “Supplementary Rules”) which provide for the electronic lodgment of documents, telegraphic transfer of Fees, electronic service of document and Adjudication Conferences via electronic means.

Thus, adjudication applications can still be made during the Circuit Breaker Period and with the SMC’s Supplementary Rules, Adjudication Conferences may be conducted via video-conferencing platforms (eg. Zoom, Microsoft Teams). Our firm continues to have full capability to support our clients in SOPA adjudications during the Circuit Breaker Period.

Case Update: MillChris Developments Ltd v Waters [2020] 4 WLUK 45

In a recent decision by the United Kingdom’s Technology and Construction Court (“TCC”), the court had rejected a contractor’s application for an injunction to halt adjudication proceedings commenced by the employer due to Covid-19 outbreak.

Briefly, the adjudicator had given directions for evidence and a site visit to occur on specific dates in April 2020. The contractor wrote to the adjudicator saying that it would not be able to comply with the proposed deadlines because of the Covid-19 outbreak and the lockdown which was in place in the United Kingdom. The contractor proposed for the adjudication to be postponed until the lockdown has been lifted. The adjudicator rejected the contractor’s aforesaid proposal, but proposed a two-week extension to the timelines. Dissatisfied, the contractor applied to the TCC for an injunction to halt the adjudication proceedings.

The contractor argued that due to the Covid-19 lockdown in place in the United Kingdom, it did not have sufficient time to prepare and gather evidence, and there would be a breach of the rules of natural justice if the adjudication was allowed to continue.

In rejecting the contractor’s injunction application, the TCC acknowledged its jurisdiction to prevent adjudications from proceeding in exceptional circumstances. However, the TCC found that the threshold was not met and also noted that any difficulties experienced by the contractor in obtaining evidence could have been overcome if it had accepted the adjudicator’s reasonable two-week extension of the relevant timelines.

Our Commentary: There is no reported decision on whether the Singapore Courts have the power to grant an injunction to stop adjudication proceedings under the SOPA, and the TCC’s recent decision in MillChris Developments Ltd v Waters [2020] 4 WLUK 45. However, the TCC’s said ruling is instructive.

Given that SMC has issued a notification and the Supplementary Rules which makes it clear that adjudication processes may proceed notwithstanding the Circuit Breaker measures currently in place in Singapore, we are of the view that the Singapore Courts would likely take a similar approach as that taken by TCC. In other words, unless the applicant demonstrates exceptional circumstances whereby the Covid-19 outbreak and/or its resulting effects (e.g. the local government’s measures) would render the adjudication process and determination a breach of natural justice, the Singapore Courts are unlikely to grant an injunction to stop adjudication proceedings from commencing or continuing, even if the Courts are satisfied that they have the power to do so.

Although it is expected that the ability of parties to prepare for adjudication would be somewhat hindered during this Circuit Breaker Period, it is unlikely that such hindrance and inconvenience caused by the Covid-19 outbreak and the measures implemented by the Singapore Government will be sufficient reason for the Courts in Singapore to grant such an injunction. Arguments that allowing adjudication proceedings to proceed would result in a breach of natural justice are unlikely to be accepted by the Court unless it is blatant and obvious to the Court that the adjudication cannot continue under the relevant circumstances.

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