Housebuilder Top Tip: Expert determination and the Court – who should be determining what?

Published 29 octubre 2020

Expert determination is a dispute resolution process which can offer a relatively speedy and effective means to settle a dispute: it is generally an appropriate mechanism for resolving technical disputes, such as valuation issues. The dispute resolution clause in a contract between the parties provides the expert with the authority, approach and conditions which they should follow and comply with.

Disputes, when they arise, do not always fall squarely into an expert’s remit – there may be issues regarding how the contract operates, which will affect the manner in which the expert makes their determination. It may not always be appropriate for a technical expert to make binding determinations on such legal issues or, indeed whether they have the jurisdiction to determine the dispute. The dispute resolution clause needs to be interpreted to establish whether it can be read or implied as making the expert the sole arbiter, including in relation to legal questions.

When entering into contracts, parties should think carefully about the types of dispute that they would like a technical expert to determine, to avoid unintentionally reserving contractual interpretation issues to a technical expert, that fall outside their expertise. Conversely, parties may want the expert to have exclusive jurisdiction relating to a specific matter, in which case, this should also be clearly stated. The Courts are now coming down in favour of preserving access to the Courts to determine legal issues, so where a contract does not confer any express rights on an expert in relation to questions of law, parties are likely to retain the right to access the Court to decide such points.

But, why leave the question open? Be clear and concise in the contract about the scope of what a technical expert can decide to avoid arguments at a later date and avoid parties using the forum for a tactical advantage.