"Smash and grab" adjudications are one of the most common ways a contractor can seek to recover outstanding debts under a construction contract.
Small to medium-sized contractors can often face difficulties, however, when the value of the unpaid debt is below £20,000.
Whilst adjudications are a quick, cost-effective process for the recovery of outstanding sums in comparison to court proceedings, each party is still liable to pay their own legal fees as adjudications are cost-neutral.
In addition, both parties are jointly and severally liable to pay the adjudicator's fees, and the adjudicator is free to determine which party should be responsible for them.
However, in most cases, the losing party is liable to pay the adjudicator's fees in full.
The effect of this is that the costs of pursuing a debt below £20,000 may well become disproportionate.