UK: Expert Determination In Construction Contracts

Last Updated: 17 October 2011
Article by Julian Bailey

"Expert determination" can refer to a broad range of decisions – binding or non-binding – made by a third party. Expert determination has been used for a long time under construction contracts as a way of settling disputes by the engineer or contract administrator. With a vast array of dispute resolution options available to contracting parties, expert determination certainly has a role to play. But what makes it different to, say, arbitration or adjudication? A recent Australian case (which is also relevant where English law applies) examined some of its distinguishing features.


The construction contract in question provided:

  • for disputes to be resolved by expert determination, following (unsuccessful) executive negotiation;
  • that "the expert must act as an expert and not arbitrator; ... and must issue a certificate in a form the expert considers appropriate, stating the expert's determination and giving reasons...", and
  • that the expert's decision would be final and binding if it imposed an aggregate liability on one party to the other not exceeding AUD$500,000.

Disputes erupted between the owner and the contractor. The disputes centred upon whether the contractor was entitled to certain time extensions, and conversely whether the owner was entitled to claim damages against the contractor for late performance. The extension of time clause contained a time-bar provision (i.e. it made an EOT conditional upon a timely notice), but the contract also conferred upon the owner an independent power to grant an EOT to the contractor even if it failed to claim an EOT within the time limit.

The expert determined that:

  • the contractor was not entitled to any EOT, as it had not provided requisite notice or details of its EOT claim (i.e. its EOT claim was time barred), but
  • because the owner had actually contributed to the delays suffered by the contractor, it was appropriate for the owner's independent power to grant an EOT to be exercised, so as to give the contractor an EOT (but not for the full period claimed), and reduce its liability for liquidated damages. In other words, the expert stepped into the owner's shoes (as he was entitled to do) and awarded a discretionary EOT.

In monetary terms, the expert decided that some AUD$497K was due from the owner to the contractor. Being just under the AUD$500K threshold, the expert's determination was binding on the parties unless a ground for challenging it could be made out. The contractor – dissatisfied with the result – sought to challenge the expert's determination.

Grounds for Challenge

Broadly speaking, under Australian law (which is similar to English law in this regard) an expert's determination is not enforceable if:

  • it is inconsistent with the requirements for such a determination as laid down in the applicable expert determination agreement, or
  • it was arrived at by fraud or collusion.

In this case, the contractor contended that the expert's determination was not binding because the expert had failed to "give reasons" which met the requirements of the construction contract. In other words, the expert's determination was not properly a "determination" under the contract due to the alleged lack of reasons.

In substance, the attack on the expert's determination was not that he had failed to give reasons for his determination – because he had – but rather that the reasons given for the determination were illogical and inconsistent. This, however, did not provide a basis for impugning the expert's determination, and accordingly the challenge to the determination was ultimately rejected. Even if the determination was illogical, inconsistent or plainly wrong, the determination would be upheld.


It is now common for expert determination agreements to require experts to give reasons for their determinations. This has the consequence of giving experts' determinations the appearance of being like an arbitrator's award or an adjudicator's decision. But as with adjudicator's decisions, inadequacies in the reasons given for an expert's determination do not usually render it unenforceable. It will only be if insufficient (as opposed to erroneous) reasons have been given that complaint may be made about an expert's determination, however the remedy for insufficient reasons may be a court order requiring that reasons – or further reasons – be given (see e.g. Halifax Life Ltd v Equitable Life Assurance Society, [2007] EWHC 503 (Comm)).

However, it is often unsatisfactory to contracting parties that an expert's determination should be binding upon them if it is erroneous, i.e. it contains flawed reasoning. There are ways in which construction contracts can be drafted to ensure that seriously erroneous decisions do not stand (short of making them non-binding altogether), including the following:

The contract provides that the decision of the expert is binding save where it contains a "manifest error".

The contract provides that the expert's determination is provisionally binding, in the same way as an adjudicator's decision under the Construction Act is provisionally binding, meaning that further, final proceedings can be brought to overcome the effects of an erroneous determination.

The final point to note is that in many cases (including this one) there may be little to distinguish between expert determination and arbitration. Contracts involving expert determination usually provide, as here, that the parties agree that the expert does not act as an arbitrator. The reason such provisions are used is to try to ensure that the dispute resolution agreement is not characterised as being an arbitration agreement, to avoid the application of arbitration legislation. Strictly speaking such provisions are not binding or conclusive, but the courts are usually strongly influenced by them, meaning (if upheld) that the expert's determination cannot be supported or attacked under the statutory provisions concerning arbitration and arbitrator's awards.

Reference: Shoalhaven City Council v Firedam Civil Engineering Pty Ltd [2011] HCA 38 click here.

This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to

Law-Now information is for general purposes and guidance only. The information and opinions expressed in all Law-Now articles are not necessarily comprehensive and do not purport to give professional or legal advice. All Law-Now information relates to circumstances prevailing at the date of its original publication and may not have been updated to reflect subsequent developments.

The original publication date for this article was 14/10/2011.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.