Jurisdiction and Powers

ODACC will not administratively decide whether a matter was properly referred to adjudication. A Claimant may commence an adjudication, and, as part of the adjudication process, request that the Adjudicator determine whether the Adjudicator has jurisdiction to decide the issue. A Respondent may also ask an Adjudicator to decide whether the Adjudicator has jurisdiction to decide the issue.

What follows is a non-exhaustive list of provisions that outline Adjudicators’ jurisdiction to conduct adjudications pursuant to the Construction Act, and Ontario Regulation 306/18.

Disputes that can be Referred to Adjudication

Section 13.5 of the Construction Act lists the types of construction disputes that can be the subject matter of an adjudication:

13.5 (1) Subject to subsection (3), a party to a contract may refer to adjudication a dispute with the other party to the contract respecting any of the following matters:

1. 1. The valuation of services or materials provided under the contract.
  2. Payment under the contract, including in respect of a change order, whether approved or not, or a proposed change order.
  3. Disputes that are the subject of a notice of non-payment under Part I.1.
  4. Amounts retained under section 12 (set-off by trustee) or under subsection 17 (3) (lien set-off).
  5. Payment of a holdback under section 26.1 or 26.2.
  6. Non-payment of holdback under section 27.1.
  7. Any other matter that the parties to the adjudication agree to, or that may be prescribed.

Subcontract

(2) Subject to subsection (3), a party to a subcontract may refer to adjudication a dispute with the other party to the subcontract respecting any of the matters referred to in subsection (1), with necessary modifications.

Expiry of adjudication period

(3) An adjudication may not be commenced if the notice of adjudication is given after the date the contract or subcontract is completed, unless the parties to the adjudication agree otherwise.

Multiple matters

(4) An adjudication may only address a single matter, unless the parties to the adjudication and the adjudicator agree otherwise.

Application despite other proceeding

(5) A party may refer a matter to adjudication under this Part even if the matter is the subject of a court action or of an arbitration under the Arbitration Act, 1991, unless the action or arbitration has been finally determined.

Labour and Material Payment Bonds

A person to whom payment is guaranteed under a labour and material payment bond may start an adjudication pursuant to s. 25 of Ontario Regulation 306/18. Section 25.(1) of Ontario Regulation 306/18 states:

25. (1) A person to whom payment is guaranteed under a labour and material payment bond required under subsection 85.1 (4) of the Act may refer to adjudication under Part II.1 of the Act any dispute with the principal and the surety in relation to the payment guaranteed under the bond.

A Claimant wishing to commence an adjudication against a principal and the surety, pursuant to s. 25.(1) of Ontario Regulation 306/18, must commence two separate adjudications and then consolidate the two adjudications. For further information on consolidation, please visit the following link: Consolidations.

Relationship between the Construction Act, Ontario Regulation 306/18, the Code of Conduct and Contractual Provisions Pertaining to Adjudication

An adjudication must be conducted in accordance with the adjudication procedures set out in the Construction Act, Ontario Regulation 306/18, the Adjudicator’s Code of Conduct, and any additional adjudication procedures that may be set out in the Parties’ contract. Section 13.6(2) of the Construction Act states:

13.6(1) An adjudication shall be conducted in accordance with the adjudication procedures set out in this Part, the regulations, and, subject to subsection (2), any additional adjudication procedures that may be set out in the contract or subcontract.

(2) Adjudication procedures set out in a contract or subcontract apply only to the extent that they do not conflict with this Part and the regulations, and their application is subject to the exercise of the adjudicator’s powers under section 13.12.

Statutory Powers Procedure Act

The Statutory Powers Procedure Act does not apply to adjudications (13.12(6) of the Construction Act).

Powers of Adjudicators

The powers of Adjudicators are outlined in s. 13.12 of the Construction Act:

13.12 (1) In conducting an adjudication, an Adjudicator may exercise the following powers and any other power of an Adjudicator that may be specified in the contract or subcontract:

1. 1. Issuing directions respecting the conduct of the adjudication.
  2. Taking the initiative in ascertaining the relevant facts and law.
  3. Drawing inferences based on the conduct of the parties to adjudication.
  4. Subject to subsection (2), conducting an on-site inspection of the improvement that is the subject of the contract or subcontract.
  5. Obtaining the assistance of a merchant, accountant, actuary, building contractor, architect, engineer or other person in such a way as the Adjudicator considers fit, as is reasonably necessary to enable him or her to determine better any matter of fact in question.
  6. Making a determination in the adjudication.
  7. Any other power that may be prescribed.

An Adjudicator may exercise his or her powers even if a Party has failed to comply with a direction of the Adjudicator (s. 21 of Ontario Regulation 306/18).

Consequences for Adjudicators Who Act Outside their Jurisdiction

If an Adjudicator acts outside his or her jurisdiction, his or her Determination may be set aside on judicial review. Section 13.18(5)3 of the Construction Act states:

13.18 (5) The determination of an adjudicator may only be set aside on an application for judicial review if the applicant establishes one or more of the following grounds:

3. The determination was of a matter that may not be the subject of adjudication under this Part, or of a matter entirely unrelated to the subject of the adjudication.

An Adjudicator acting outside his or her jurisdiction may also lead to a determination by ODACC that the Adjudicator is incompetent or unsuitable to conduct adjudications. This is one type of behaviour that may lead to ODACC suspending or cancelling the Adjudicator’s Certificate of qualification to adjudicate. Pursuant to s. 5.(1) of Ontario Regulation 306/18,

5.(1)The Authority may suspend or cancel a holder’s certificate of qualification to adjudicate if it is reasonably satisfied that,

1. 1. the holder has ceased to be eligible to hold the certificate under section 3, or has failed to comply with the code of conduct or to meet any other requirement of section 4;
  2. the holder is incompetent or unsuitable to conduct adjudications; or
  3. the certificate was issued or renewed on the basis of a false or misleading representation or declaration.