Adjudication in New Zealand: five working days to down tools

Adjudication is the part of the Construction Contracts Act 2002 that people reach for last and should reach for earlier. It is fast, it is available for any dispute under a construction contract, and its outcome can be turned into a District Court judgment against a defendant whose available arguments are almost exhausted.

This article sets out the timetable, the suspension right that runs alongside it, and where the enforcement fight actually happens.

Section 25: the right, and what it covers

"Any party to a construction contract — (a) has the right to refer a dispute to adjudication; and (b) may exercise that right even though the dispute is the subject of proceedings between the same parties in a court or tribunal."

The examples in s 25(2) show how wide "a dispute" is:

"(a) whether an amount is payable under the contract (for example, a progress payment) or the reasons given for non-payment of that amount; or (b) whether there has been a breach of a term of the contract (including a term implied into the contract under the Building Act 2004 or any other enactment)."

Paragraph (b) is the one that surprises people. The implied warranties in s 362I of the Building Act 2004 are terms of the contract, so a warranty dispute can go to adjudication. And under s 362J(2)(a) of that Act, an owner who was never a party to the contract can bring it.

The single exception is in s 25(3): a dispute may not be referred without consent where the parties have agreed to refer disputes to arbitration and that arbitration is an international arbitration or falls under the listed international instruments. A domestic arbitration clause does not block adjudication.

Section 26 keeps the door open both ways: nothing prevents the parties submitting a dispute to another procedure, and doing so "does not — (a) bring to an end the adjudication proceedings; or (b) otherwise affect the adjudication." But s 26(3) requires the adjudicator to terminate "if, before the adjudicator determines the dispute, that dispute is determined under another dispute resolution procedure."

And s 26(4): "Nothing in any other enactment or rule of law or any contract affects the application of this Part."

The timetable

Section 36(2) sets out the claim's content: it "must specify the nature or the grounds of the dispute and, to the extent that it remains relevant, be accompanied by a copy of the notice of adjudication", and may be accompanied by any other documents. Section 36(3) requires the claimant to serve a copy on every other party "either before or immediately after" it goes to the adjudicator.

Section 46(1) protects the respondent's window: the adjudicator "must not determine a dispute until after the end of the period referred to in section 37(1)" and "must not determine a dispute having regard to that response unless it was served on the adjudicator before the end of that period."

Five working days for the response is very short. For a respondent, the practical consequence is that the case has to be assembled before it is needed — which in most disputes means the payment schedule, the site records and the correspondence must already exist in a form somebody can find.

One provision worth knowing when the contract names an adjudicator: s 33(3): "An agreement about the choice of an adjudicator or a nominating body or an authorised nominating authority is not binding on the parties to the adjudication if that agreement was made (whether under the relevant construction contract or otherwise) before the dispute between them arose."

Section 24A: suspension, step by step

Suspension is not a self-help remedy you can exercise the day payment is late — the claimed or scheduled amount it turns on is set by the process covered in Payment claims and payment schedules: twenty working days. Section 24A(1) requires all three of:

"(a) any of the following circumstances applies: (i) a claimed amount is not paid in full by the due date for its payment, and no payment schedule has been provided …; (ii) a scheduled amount is not paid in full by the due date …; (iii) party B has not complied with an adjudicator's determination …; and (b) party A has served on party B a notice under section 23(2)(b), 24(2)(b), or 59(2)(b) …; and (c) the amount … is not paid, or the determination … is not complied with, within 5 working days after the date of that notice."

So: the trigger event, then the notice, then five working days. Downing tools before that sequence is complete is a breach of contract, not an exercise of the statutory right.

The protection once the sequence is complete is broad. Section 24A(2):

"(a) is not in breach of the construction contract; and (b) is not liable for any loss or damage suffered by party B, or by any person claiming through party B; and (c) is entitled to an extension of time to complete the contract, but is not entitled solely by reason of this Act to recover any costs incurred as a consequence of the extension of time; and (d) keeps party A's rights under the contract, including any right to terminate the contract; and (e) may at any time lift the suspension, even if the amount has not been paid …"

Paragraph (c) contains the limitation to note: the Act gives you the time but not the money for it. Section 24A(3) confirms that any rights you have to recover those costs otherwise — under the contract, or in an adjudication on other grounds — are untouched, "nor does it add anything to those rights."

Section 24A(5): "The right to suspend work under a construction contract ceases when party B pays the amount in full or complies with the adjudicator's determination."

Enforcement: section 73, and the five working days that follow

A determination that money is payable is enforced by applying to have it entered as a judgment of the District Court under s 73. The applicant must serve on the defendant "a copy of the application" and "a statement setting out the consequences for the defendant if the defendant takes no steps in relation to the application."

Two conditions on the applicant, in s 73(5): the application may be made only "if any conditions imposed by the adjudicator have been met" and "after the date (if any) specified in the adjudicator's determination for compliance."

The defendant then has a narrow window and narrower grounds. Section 74(1): "the defendant must, within 5 working days after the date on which the defendant is served a copy of the application, apply to the District Court for an order that entry of the adjudicator's determination as a judgment be refused."

The grounds in s 74(2) include that "the contract to which the adjudicator's determination relates is not a construction contract to which this Act applies", that "a condition imposed by the adjudicator in his or her determination has not been met", that "due to a change in circumstances, which was not caused in any part by the defendant, it is not possible to comply", and that the date specified for compliance has not yet passed.

Notice what is not on the list: that the adjudicator was wrong. Section 74(3) then requires the court to refuse entry if satisfied a ground applies, and s 74(4) requires it to accept the application if not.

And if the defendant does nothing, the determination is entered as a judgment.

Section 79: no set-off

"In any proceedings for the recovery of a debt under section 23 or section 24 or section 59, the court must not give effect to any counterclaim, set-off, or cross-demand raised by any party to those proceedings other than a set-off of a liquidated amount if — (a) judgment has been entered for that amount; or (b) there is not in fact any dispute between the parties in relation to the claim for that amount."

This is what makes the s 22 and s 23 machinery worth using. A payer who ignored a payment claim cannot answer the debt proceedings with a back charge, a defect claim or a liquidated damages calculation. Only a liquidated amount that is already a judgment, or genuinely undisputed, can be set off.

What this means before a dispute exists

Adjudication rewards the party whose records were already in order, because the response window is five working days and the referral window is five.

Three things are worth having ready at all times, not assembled in a crisis:

1. Payment claims and payment schedules, with dates of service. Every step in Parts 2 and 3 runs from service.
2. Time and attendance per person per day, on the project. Most disputes about progress payments are disputes about how much work was done in the relevant period.
3. Photographs and documents on the project, dated. In a five-day window, a file you can open beats a file you have to build.

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Checked on 29 August 2026 against the Construction Contracts Act 2002 as at 5 October 2023 on the New Zealand Legislation website. This describes the legislation and is not legal advice; adjudication has its own case law on jurisdiction and natural justice, and an adjudication worth running is an adjudication worth taking advice on.

What Zirko does: it records when documents were created and sent, keeps quotes, invoices, documents and photos against the project, and records time per person per day. What Zirko does not do: it does not serve notices, does not calculate statutory periods, and does not prepare an adjudication claim or response.