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The New Ontario Dispute Adjudication for Construction Contracts

The introduction of adjudication and prompt payment regimes for Ontario construction projects is fast approaching. Under the new Construction Act (Act), these significant changes come into effect on October 1, 2019.

Adjudication is intended to provide real-time dispute resolution on construction projects in Ontario. Once a party issues a notice of adjudication, adjudicators will render decisions on disputes that arise on a project on a case-by-case basis, with adjudication decisions being provided within 30 days. To facilitate this process, the provincial government has recently announced the selection of an Authorized Nominating Authority: Ontario Dispute Adjudication for Construction Contracts (ODACC) operated by ADR Chambers Inc., a private body designated by the Ontario government to manage adjudications.

Leading up to October 1, the ODACC must comply with a number of responsibilities under the Act, including:

  • Creation of a registry of ODACC adjudicators:

    Adjudicators will be drawn from across the province and across the construction sector, with lawyers, architects, engineers, chartered surveyors, and contractors (among others) all able to act as adjudicators. The registry will indicate the geographic area where each adjudicator is available. This will mean you have the opportunity to select an adjudicator with knowledge and expertise specific to the matter in dispute.
  • Training and qualification of ODACC adjudicators:

    The ODACC is responsible for developing and overseeing training programs, which adjudicators must complete in order to qualify for the registry. The ODACC must also ensure that adjudicators meet the minimum qualifications listed in the Act, which requires that an adjudicator:
    • Has 10 years or more of working experience in the construction industry
    • Attend ongoing training programs, as required by the ODACC
    • Not be an undischarged bankrupt, not have been convicted of an indictable offence
    • Abide by requirements for holders of the code of conduct
  • Development of the ODACC website:

    The purpose of the website is to provide all parties an overview of the adjudication process and how the ODACC’s service may be accessed. The ODACC must also publish educational materials on the process, and an annual report on construction adjudication in Ontario.
  • Managing the role of adjudicators:

    The ODACC will have a number of ongoing responsibilities to manage the registry of adjudicators and the conduct of its qualified adjudicators. Such responsibilities include:
    • Maintaining a fee schedule which will apply if parties and the adjudicator do not agree to adjudication fees
    • Creating a code of conduct for adjudicators, in consult with the Ontario government
    • Creating and managing a complaints procedure where complaints may be launched against adjudicators on the ODACC registry
    • Appointing an adjudicator to a dispute, if the parties are unable to reach agreement on the adjudicator

With the wide ranging of expertise of adjudicators, it will be important for parties to choose their adjudicator wisely. Those who are experts in contract interpretation may not be as knowledgeable for disputes regarding the value of a change in scope of work, and vice versa. It is imperative that you select an adjudicator who is most appropriate for the particular issue in dispute.

The ODACC website is now live and the application process is open to potential adjudicators. As the implementation of the adjudication process nears, and once the registry has been set up, parties should familiarize themselves with the adjudicators available and the various types of expertise in their geographic area.

John Melia and Kara Takagi are construction lawyers in our Ottawa office.