Enforcement of CIPAA Adjudication Decision

Enforcement of CIPAA Adjudication Decision is the last and utmost important stage of CIPAA Adjudication Proceeding. Do it right by employing the appropriate and effective enforcement methods and you will be able to recover payment in a swift and expeditious manner; Do it wrong and you will be engulfed in a lengthy court battle and left with a paper judgment.

What are the available methods and the most effective methods to enforce a CIPAA Adjudication Decision?


Under the Part IV of Construction Industry Payment and Adjudication Act 2012 (CIPAA), there are 3 methods of enforcement which can be exercised concurrently:-

Section 28: Enforcement of Adjudication Decision as Judgment

Section 29: Suspension or reduction of rate of progress of Performance

Section 30: Direct Payment from Principal

Winding up Proceeding: Alternatively, the winning party may also seek to enforce the Adjudication Decision by issuing a Statutory Demand under Section 466 of Company Act 2016. If the losing party fails to meet the demanded Adjudicated Sum within 21 days, the winning party may proceed to wind up the losing party and liquidate its assets to meet the debt.Enforcement of CIPAA Adjudication Decision_Enforce as judgment_Suspension_Direct Payment_Winding Up | CIPAA Consulting

Section 28: Enforcement of Adjudication Decision as Judgment

In order to enforce an Adjudication Decision as if it is a judgment of the court, you must engage a lawyer.  

The process is initiated by filing an Originating Summons and Affidavit in Support to the High Court.

Ordinarily, the process will take about 3 months to complete if uncontested and will take up to 6 months to complete if the Losing Party contests against the application and filed a separate application to set aside the Adjudication Decision.

The advantage of enforcing the Adjudication Decision as if it is a judgment of Court is that once the Court Order is obtained, the Winning Party may proceed to execute the Adjudication Decision using the available execution process under the Rules of Court 2012 by either:

  1. seizing and selling the property of the losing party by way of Writ of Seizure and Sale;
  2. Garnishing the money from the losing party’s Bank or other losing party’s debtor by way of Garnishee Proceeding;
  3. Issuing Judgment Debtor Summons;

Section 29: Suspension or Reduction of Rate of Progress of Performance

Generally, non-payment or delayed payment is not a valid excuse to suspend or slow down work.

In the absence of an express provision to allow the Contractor to suspend or slow down work in the construction contract, the suspension or slowing down of work due to non-payment or delayed payment will be viewed as repudiatory breach of contract.

However, if the Unpaid Party / Claimant resorts to CIPAA and obtained an Adjudication Decision in its favour, it may then suspend or slow down the performance of its work if the Losing Party fails to honour the Adjudication Decision.  

In such circumstance, the suspension or slowing down of work will not be seen as a breach of contract and the Winning Party is even entitled for extension of time and to recover any loss and expense incurred arising from the suspension or slowing down of work.

Often time, the suspension or slowing down of work will exert a great deal of pressure to the Losing Party to pay the Adjudicated Sum as the Losing Party may potentially face the exposure of having to pay liquidated ascertained damages/ delay damages (LAD) to the Employer or the end purchasers (in the case of developer).

As a result, the Losing Party would then have to pay the Adjudicated Sum to the Winning Party promptly and without delay to avoid having to pay the LAD to the Employer or the end purchasers.

However, this method of enforcement is only possible if the construction work is still underway and incomplete.

Section 30: Direct Payment from Principal

Lastly, the Winning Party may also request for direct payment from the Losing Party’s principal pursuant to Section 30 of CIPAA.

Practically, this is the most straight forward and quickest way of obtaining the payment of Adjudicated Sum.

However, Section 30 may only be invoked if there is money due and payable by the Principal to the Losing Party at the time of the written request for direct payment.

Who is the Principal under Section 30 of CIPAA?

The “Principal” has been defined under Section 4 of CIPAA as “a party who has contracted with and is liable to make payment to another party where that other party has in turn contracted with and is liable to make payment to a further person in a chain of construction contracts”.  In simple words, this refers to the Employer of the Losing Party.

The direct payment process can be summarised as the following:

  1. Written Request

    The Winning Party shall make a written request to the Losing Party’s principal for the Adjudicated Sum.

  2.  Reply to the Written Request

    Upon the receipt of the written request for direct payment, the Principal shall have 10 working days to reply and state:

    i) Whether there is any money due and payable by the Principal to the Losing Party;

    ii) Whether there is any Proof of payment of such money; and/or

    iii) Whether the direct payment is to be made.

  3. Failure to Reply

    If the Principal fails to provide proof of payment within 10 working days, the Principal shall pay the Adjudicated Amount to the Winning Party.

  4. Recovery of Payment

    If the Principal had made the direct payment, the Principal would then have to recover the Adjudicated Sum paid by way of set off / debt from the losing party.

It is important to note that if there is money due and payable by the Principle, the Principal is mandated and legally bound to make direct payment to the Winning Party although the Contract does not provide for such direct payment. The Principal would be in contravention of the Act if it refuses to do so.

See: Case Update: Principal is Legally Bound to make Direct Payment to Winning Party if there is Money Due and Payable

Winding Up Proceeding

Lastly, the Winning Party may also issue a Statutory Demand pursuant to Section 466 of Company Act 2016 (Statutory Demand) to the Losing Party based on the Adjudication Decision.

See: CASE UPDATE: CIPAA Adjudication Decision as The Basis of Winding Up without Enforcement Application

If the Losing Party fails to meet the statutory demand and make payment thereof within 21 days, the Winning Party may proceed to wind up the Losing Party’s company and liquidate its asset to pay the Adjudicated Sum.

Often time, the Winning Party will utilise the Statutory Demand as a tool to exert pressure on the Losing Party to make payment of the Adjudicated Sum as the Losing Party is not afforded to be wound up.

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