Pay now argue later

Construction Law Barrister Robert Fenwick Elliott coined the expression ‘Pay now, argue later’ to describe the adjudication process in early 1996 during discussions with Lord Howie of Troon in the tea room at the House of Lords. He describes below how this came about.

Lord Howie was a Scottish engineer, picking up the recommendation in Sir Michael Latham’s Report ‘Constructing the team’ to introduce an adjudication scheme into construction contracts, and very sensibly sought the input of TeCSA (Technology and Construction Solicitors’ Association) as to how this might best be done.

I was advising him to stay clear of his initial idea of making the adjudicator’s decision final and binding, on the basis that if it was final and binding, it would be impossible to prevent the courts from placing all sorts of obstacles in the way of enforcement. It was a play on the old hire purchase slogan: 'Buy now, pay later'. I said that if an adjudication loser was obliged to pay up, without prejudice to its right to then fight it out in the courts or arbitration to try to get it back, that would achieve the objective we were looking for, but minimising the risk of court interference. It would be rare, I predicted, that this right to 'argue later' would be used very much in practice. Happily, he agreed, and my prediction eventually proved good.

Lord Howie mentioned the formulation in debate on 28th March 1996, as did Lord Akner on 22nd April 1996.

It was picked up by the courts in the UK in Homer Burgess Ltd v Chirex (Annan) Ltd [1999 ScotCS 264 (10 November 1999)] and then in Australia in Multiplex Constructions Pty Ltd v Luikens and Anor [2003 NSWSC 1140 (4 December 2003).

Since then it has been used many times to characterise the nature of the adjudication process.

This article originally appeared at Pay now, Argue Later 15/01/2016.

It was written by --Robert Fenwick Elliott.

[edit] Find out more

[edit] Related articles on Designing Buildings Wiki

• Adjudication.
• Alternative dispute resolution.
• Arbitration Act.
• Arbitration.
• Breach of contract.
• Causes of construction disputes.
• Conciliation.
• Contract claims.
• Dispute resolution boards.
• Mediation.
• Pendulum arbitration
• The Housing Grants, Construction and Regeneration Act.
• The Scheme for Construction Contracts.