CIPAA Adjudication Consultancy

The Construction Industry Payment and Adjudication Act (CIPAA) 2012 has come into operation effective 15 April 2014 to address the cash flow problems related to payment for work done and services rendered under the express terms of a construction contract. It allows the Claimant (who is owed monies under a construction contract) to have the disputes resolved with the Respondent in a quick & cheap manner & it is a mandatory statutory process (can be commenced at any time whether during or after project completion) that does not require the agreement of the Parties’ to commence & overrules over any contractual agreements to the contrary. The proceedings is simpler, cheaper & faster vs arbitration and/or litigation and is a private & confidential process. The adjudicator must deliver his decision

Statutory adjudication is compulsory (except those exempted by the Act) whereby any party to a construction contracts has the right to resort to adjudication & no contracting out of the Act is allowed under the Act. Reference to CIPAA only restricted to construction disputes with regard to payment for work done & services rendered. However, the Parties are to extend the jurisdiction of the adjudicator (after appointment) to decide on any other matter arising from the construction contract. CIPAA covers all written construction contracts (carried out wholly or partly in Malaysia) which comprising of buildings, oil & gas, petrochemical, telecommunication, utilities, infrastructure, supply contracts & consultancy contracts. The Act applies to both Public & Private Sector except an individual owner who erects a building

Step 1: Making & Responding to a Payment Claim First, the Unpaid Party to serve a Payment Claim on the Non-Paying Party. After which, the Non-Paying Party may either pay up or serving a Payment Response Step 2: Initiation of Adjudication CIPAA is initiated by the serving of a written Notice of Adjudication. The Claimant shall Step 3: Nomination of Adjudicator Appointment of adjudicator will be proceeded after (& not before) the Claimant served a valid Notice of Adjudication to the Respondent & the Parties are free discuss on the appointment of the adjudicator Step 4: Appointment of Adjudicator After being notified by KLRCA, the selected adjudicator are free to either accept or refuse the appointment. If accepted, the selected adjudicator shall submit a written declaration to the Director of KLRCA & deliver a copy of his terms of appointment & fees to be paid by the Parties. The adjudicator must Step 5: Adjudication Claim & Response The Claimant is r...