Adjudication and the 'Residential Occupier Exclusion': Time for a Rethink?

Philip Britton

May 2015

A paper based on the joint first prize entry in the Hudson Prize essay competition 2015

One of the distinctive features of most statutory security of payment regimes is that they do not apply to construction contracts between individual consumers and 'builders' for work related to dwellings. The UK's 'residential occupier exception' is contained in s106(2) of the Housing Grants, Construction and Regeneration Act 1996. This paper considers what situations the UK exception covers, or appears to cover; outlines what its consequences are, for those whose contracts fall within it; looks at how evolving consumer protection - notably the Consumer Rights Act 2015 - benefits residential construction employers; and finally asks whether the exception should be abolished or modified.

Introduction - The arrival of statutory adjudication - The 'residential occupier exception' - The paper's aims - Scope of the exception - Statute and case law - The burden of proof - Pther interpretation issues - A broader issue - Effect of falling within the exception: the HGCRA - Scenario I: no general dispute resolution provisions - Scenario II: the parties 'choose' adjudication - Is adjudication unfair in law? - The 1993 Directive in English law - Challenging ADR in construction - Rethinking unfair contract terms law - Possible ways forward - Abolish the exception? - Narrow the exception? - ADR in all construction contracts with consumers? -- Conclusions.

The author: Philip Britton LLB BCL is a Visiting Professor and former Director, Centre of Construction Law & Dispute Resolution, The Dickson Poon School of Law, King's College London; a Visiting Scholar, Law School, University of Melbourne; and consultant to the law firm of Fairweather Stephenson & Co Ltd, Aldeburgh, Suffolk: e-mail philip.britton@marshwinds.co.uk.

Text: 23 pages