Adjudication is the most commonly used mechanism for resolving construction disputes in New Zealand [1]. It is fast, cost-effective, and keeps cash moving – but the regime is under pressure from several developments that will affect how disputes are run and outcomes achieved.

MinterEllisonRuddWatts’ Chair and Partner Janine Stewart and Senior Associate Rebecca Cook recently presented to both the Society of Construction Law New Zealand across New Zealand in April 2026 and the Society of Construction Law International in South Korea in October 2025, examining how adjudication works across New Zealand, Australia, the United Kingdom, and Canada – and what the comparative picture tells us about where our regime could improve.

Adjudication and jurisdiction in New Zealand

In New Zealand, adjudication was introduced by the Construction Contracts Act 2002 as a speedy dispute determination mechanism to facilitate cash flow. It is undoubtedly the preferred dispute resolution forum for contractors and subcontractors, with claims exponentially growing year on year. 

Jurisdiction across jurisdictions: A comparative picture

While all jurisdictions share similar themes underpinning adjudication, the breadth of that jurisdiction differs considerably:

• In the United Kingdom, the Housing Grants, Construction and Regeneration Act 1996 provides that any party to a construction contract may invoke adjudication at any time to resolve any dispute arising under the contract [2], and the right cannot be contracted out of. 
• In New Zealand, adjudicator jurisdiction is set by the Construction Contracts Act 2002 and, since the 2015 Amendment Act, extends to both payment disputes and rights and obligations. 
• Australia is the most restrictive of the four jurisdictions, but scope is expanding – New South Wales, Victoria, and Queensland each limit adjudication to progress payment disputes only, with the right reserved for the party performing the work. Victoria, however, is slightly different, with changes to the Building and Construction Industry Security of Payment Act 2002 coming into force which broadens claim scopes, establishes statutory timeframes, and retroactively applies to existing construction contracts.
• Canada is the most recent entrant: Ontario introduced statutory adjudication in 2019, amendments as of January 2026 have expanded its scope, and four of ten provinces now have statutory adjudication regimes.

In all jurisdictions, a determination made outside an adjudicator's jurisdiction is unenforceable and may be challenged. These "jurisdictional challenges” have become part of the lawyers' toolbox — strategically deployed to extend timeframes, exclude claims or defences, and lay the groundwork for challenging unfavourable determinations. Common examples across all jurisdictions include arguments that no crystallised dispute exists, that multiple disputes have been improperly bundled into a single referral, and that the determination exceeds the scope defined in the notice of adjudication.

None of these issues are inherently abusive, but the data suggests they are raised with increasing frequency. In New Zealand, jurisdictional challenges arose in 14% of claims between 2008 and 2022, though only 2% succeeded. In the United Kingdom, challenges featured in 23% of cases with a 15% success rate. Australia varies. In Queensland, 36% of adjudication applications between 2024 and 2025 were not determined due to lack of jurisdiction; in New South Wales, that figure was 25% a decade earlier. This illustrates that while the underpinnings of each jurisdiction’s regimes are compatible, limits on an adjudicator’s jurisdiction and powers can significantly alter the effect and outcome of the regime. 

These comparative insights informed the discussion on whether changes to New Zealand's adjudication regime are needed, and what other changes may be beneficial.

Changes to the adjudicator pool and process

A key point of discussion was whether New Zealand’s pool of adjudicators was sufficient to fulfil the purposes of the adjudication regime. This included conversations on the diversity of adjudicators in New Zealand, and what the mandatory requirements should be to become an adjudicator. 

Under New Zealand's Construction Contracts Act 2002, the Act provides that adjudicators must meet prescribed qualifications, expertise, and experience but no minimum qualifications have ever been prescribed. The pathway to becoming an adjudicator remains unclear and inconsistent. That lack of a structured accreditation process is a barrier to entry for capable professionals who might otherwise contribute to the regime. A clearer, more accessible process, with defined competency requirements, training pathways, and ongoing professional development would help broaden the pool of available adjudicators. A larger and more diverse pool is essential: adjudicators with different strengths and specialisations need to be available so that appointments can be matched to the nature and complexity of the dispute. Diversity in the adjudicator pool, reflecting the breadth of the construction industry and the professions that serve it, should be a deliberate objective of any reform to the appointment framework.

Proportionate liability reform

The New Zealand Government has announced it will replace the current framework of joint and several liability with proportionate liability. Under the current framework, any one defendant can be held responsible for the full loss regardless of their share of fault. Proportionate liability would limit each party's exposure to their actual share of responsibility. During the presentations, the impact of this change on adjudication in New Zealand was discussed. 

This is a significant shift, and its interaction with adjudication is unresolved. Adjudications are conducted between two parties to a construction contract. Proportionate liability requires an assessment of fault across all contributing parties – including those that are not named as respondent in the notice of adjudication and therefore not before the adjudicator. How an adjudicator will determine proportionate shares where other responsible parties are absent from the process remains unclear, as do questions about the enforceability of determinations made on a proportionate basis.

If you are involved in a multi-party construction dispute, or managing a project where responsibility for defects or delay is likely to be shared, the proposed proportionate liability regime adds complexity to how and when you pursue or defend claims. It also raises questions about how indemnity provisions and insurance arrangements in your contracts will need to respond.

What needs to change?

Four areas where targeted reform would strengthen adjudication's effectiveness were also identified and discussed:

• Broaden the scope of jurisdiction. The current limitation to disputes "arising under" the contract generates unnecessary uncertainty and prevents parties from putting their full case. The clearest improvement could be to extend the adjudicator's jurisdiction to all disputes arising out of or in connection with a construction contract, including statutory and equitable claims. The United Kingdom's broader model provides a working template. However, there needs to be more flexible timeframes to accommodate this – see point below.
• Give adjudicators more flexibility on timeframes. In Australia and the United Kingdom, adjudicators cannot extend statutory timeframes without party agreement. In complex disputes, now commonplace, this is a genuine problem. A discretion to extend timeframes where warranted would address this limitation. This would improve decision quality and reduce challenges for procedural shortcomings.
• Raise the standard for adjudicator appointment and broaden the pool. No minimum qualifications have ever been prescribed under the Construction Contracts Act 2002 or its Regulations, and the pathway to becoming an adjudicator remains unclear – creating a barrier to entry for capable professionals. A structured accreditation process with defined competency requirements and training pathways would address both issues: raising appointment standards while expanding and diversifying the pool of available adjudicators to match the growing complexity of disputes.
• Confront the proportionate liability question now. The announced shift to proportionate liability will create a direct tension with the bilateral structure of adjudication that has not been resolved. This also cuts across the fundamental principle of freedom of contract. Practitioners and policymakers should be engaging with this issue now, before the new regime beds in, rather than waiting for the conflict to emerge in a live determination.

There is clear scope to strengthen adjudication regimes across all jurisdictions, including New Zealand. This can be achieved by broadening jurisdiction, providing greater flexibility on timeframes, raising appointment standards, and confronting the proportionate liability question before it creates conflict in live determinations.

Adjudication's core purpose – speed, cost-effectiveness, and maintaining cash flow – remains sound. The challenge is ensuring statutory frameworks keep pace as the construction industry grows in scale and complexity.

For more information on adjudication under the Construction Contracts Act 2002, or to discuss any of the themes raised in this article, please contact Janine Stewart or Rebecca Cook.

This article was co-authored by Hayden Rumble, a Solicitor in our Construction and Infrastructure team.  

Footnotes

[1] Building Disputes Tribunal, ‘Statutory Adjudication in NZ 2003-2023’, Building Disputes Tribunal– CCA Adjudication, 2026

[2] Section 108(1)