What is construction adjudication and how is it different from suing in court in Ontario?
Adjudication is a fast, interim-binding dispute resolution process built into the Construction Act specifically for construction payment disputes, designed to keep cash flowing on a live project rather than forcing parties to wait out a full lawsuit before a payment issue gets resolved. Either party to a contract can refer an eligible dispute - most commonly about the valuation of work, a change order, or a payment or non-payment notice - to an adjudicator appointed through the province's authorized nominating authority, and the process runs on a fast, legislated timeline that's considerably quicker than ordinary litigation.
The adjudicator's determination is binding on an interim basis and must generally be complied with right away, but it isn't necessarily the final word - a party can still pursue the matter through litigation or arbitration afterward if they want to challenge the outcome permanently, similar in spirit to how a temporary order can later be revisited at trial. This makes adjudication most useful for resolving cash-flow disputes during an active project, while court litigation remains the route for a final, permanent resolution of the underlying dispute, including any claims adjudication wasn't designed to capture.
Key takeaways
- Adjudication is a fast, interim-binding process under the Construction Act for resolving construction payment disputes.
- It runs on a legislated timeline much quicker than ordinary court litigation, keeping cash flowing during an active project.
- An adjudicator's decision is binding immediately but isn't necessarily final - it can still be revisited through litigation or arbitration.
- Adjudication suits live cash-flow disputes, while litigation remains the route to a permanent, final resolution.