Patrick Waterhouse: Thank you.
Nasir Khan: years ago when Patrick, if you remember, you chaired the contracts and dispute resolution panel for the Chartered Institution of Civil Engineering Surveyors.
Patrick Waterhouse: I remember.
Nasir Khan: It's a real pleasure. So welcome you to Common Sense Not So Common. Let me begin with the question I ask every guest. Do you believe in common sense?
Patrick Waterhouse: Yes, absolutely.
Nasir Khan: So can you recall a time when you applied it successfully or perhaps a time when you should have applied it sooner?
Patrick Waterhouse: I can think both of those and I think back to the early part of my career managing construction sites where common sense was needed minute by minute and thinking on your feet was certainly a part of what you had to do. Common sense as your your strapline says is often not very common and I think you and I just before we started recording we're talking about our teenage children.
Nasir Khan: Yeah, I think what's the happy?
Patrick Waterhouse: And if you want to see a complete lack of common sense, you know, just deal with some teenage children. And then as the proud owner of a daughter in her twenties, I can tell you that at some point in their late teens, the common sense returns and the behavior that we all, you know, laugh and occasionally grimace about it, it disappears. But even so in
Nasir Khan: Yeah.
Patrick Waterhouse: our industry, there are people at times who seem to lack common sense. And I think
Nasir Khan: So
Patrick Waterhouse: Some of that is caused by the fact our industry is heavily proceduralised and corporately organisations sometimes make the daftest decisions because individuals have not applied common sense or possibly are in positions where they feel they're not allowed to.
Nasir Khan: I think it's just fit. are you suggesting that our industry is full of teenagers?
Patrick Waterhouse: There are some. The encouraging thing about our industry is that if you are criticising somebody in your own mind or in a conversation you just dealt with and said, why did she do that? Why did he say that? It's not long before you come across someone else who restores your faith in humanity and you realise probably that the good people outnumber the less good ones.
Nasir Khan: Yeah, so so so more late teens rather than early teens, I guess.
Patrick Waterhouse: Yes.
Nasir Khan: So you just you just mentioned your
Patrick Waterhouse: You
Nasir Khan: early career, which is I I know fantastic because I'm almost trying to copy your path always. And as a as a civil engineer, of course, working on construction sites, you say, you know, it's it's a lot of approach around practical experience and how you applied common sense. How has that practical experience and the application of common sense shaped your career now? As a prominent adjudicator resolving disputes.
Patrick Waterhouse: It's had an enormous effect and it continues to do so day by day. So I had the good fortune as it turns out now to get a little bit of experience in an awful lot of different places and become what they often used to say a jack of all trades, a master of none, which proves very useful. Working on site you largely come across great people and I started on site, you know, black and white photos time. in the mid to late 1980s. We had different technology but the same issues as today. We didn't have the internet or email, we didn't have online communication systems. I remember getting very excited at the delivery of a fax machine and reading the manual and you used to tell that story and people would smile at you. Most people these days scratch their head and say what's a fax machine? But we had exactly the same issues on site.
Nasir Khan: Yeah, we get to base the mass machine. Well, you would have to have some questions.
Patrick Waterhouse: I had the honour last week of going on a site visit as part of one of my adjudications and the section engineer showed us round. Paul Ladd was given several lawyers and senior advisors to the two parties to show round his site and he was bursting with pride and rightly so. The two parties have a commercial disagreement but the site is something to be proud of.
Nasir Khan: That's what I'm talking about. That's part of the problem making patients. definitely not as well.
Patrick Waterhouse: I was a section engineer the last time I had what I euphemistically term as a real job. And I could see some of me in him. And those experiences working on site do inevitably help. Over the last couple of years, I've done three adjudications, bizarrely, that involve a pilot rig overturning, which is a really serious event. And that happened to me back in 1994.
Nasir Khan: I could not get to the books.
Patrick Waterhouse: nobody was hurt. Had the pylon rig in question fallen about a metre to one side, it would have killed several people. There were very good reasons why that happened, not excuses, and we dealt with it, but it was interesting, you know, 30 years later, facing adjudications about exactly the same issue, and particularly where one of the parties involved tried to effectively say it was just one of those things not to worry.
Nasir Khan: But I think question is why the highest here is the push of that you could have a bit of a massive form. I think it's pretty bad.
Patrick Waterhouse: and having been that person, you kind of think, well, it was something to worry about. And I also, having worked on site, realised the complexities of what people are dealing with. an increasing tactic in adjudication now is to give you witness statements to the people on the project and a wise legal advisor will get those people to pitch in with some of the legal arguments, which aren't strictly...
Nasir Khan: Absolute witness statements. We can have this discussion. You mentioned witness statements. Are these witness of facts or expert witnesses?
Patrick Waterhouse: part of witness statements. But I'm always forgiving of sight people who've made mistakes or been involved in difficult situations because I know the stressors, the strains they're under. And it also shows me when perhaps my knowledge is at the limit and I need to ask for more help, more information. Thank Well, we have both. was referring to witnesses of fact there, you know, where the site engineer, the site manager, the QS says, you know, they should be saying this is what happened. This is what I did or what I saw. Increasingly, we're seeing as a cute tactic where they say a little bit of I saw this and therefore this means that absolutely this claim succeeds because of, you know, Smith versus Jones in the TCC two years ago. Expert witness reports are increasingly common and are, as you may be aware from your own work, of extremely variable quality.
Nasir Khan: Yes. Variable quality, of course. we've come across those several times. moving on, I know
Patrick Waterhouse: Thank
Nasir Khan: you have a significant amount of experience with the NEC4 contracts. You were part of the team that produced it, you co-authored several important publications on its practical application. I probably helped in one of your publications as well with some practical examples of dealing with NEC issues. Now, having having
Patrick Waterhouse: You did?
Nasir Khan: having written, taught, how are you feeling it now where NEC was, say, 10 years ago or 20 years ago, in terms of how they were designed and what they are actually used for?
Patrick Waterhouse: So NEC is now mainstream. It's not the new kid on the block anymore. For years, that's how it was pitched by people. And you see NEC's terminology and its process as being shamelessly copied by solicitors drafting contracts all over the place. And there are other forms of contract in the UK building industry who remain nameless, who have also changed what they do significantly just by coincidence very similarly to what NEC does. So you know it's the ultimate form of flattery isn't it. Now I remember the consultative version of what you might call NEC 1, it wasn't called that, being issued in
Nasir Khan: I think we can also attribute.
Patrick Waterhouse: 1991 to greater claim and as a young ambitious site engineer I was in head office one day and saw a copy of it on my managing director's desk. And I said, Mike, what do you think of this? I've read all about it. He said, Patrick, this is terrific. He said, but we'll let someone else use it first. And that was indicative of how a lot of the industry viewed NEC with suspicion. I have a client who I happily provide JCT training to who is a regional building contractor who tells me they will not even bid. for NEC work because it's so wacky, it's so bonkers, there's no way they're touching it. Which is unfortunate, I keep trying to change their minds, but there you go. But I think the terms of contract are only one step towards success. People make projects successful or people make them fail. Contract administration is seen as being dull, not very important, but it's vital. Whichever contract you sign up to.
Nasir Khan: Okay. That's what
Patrick Waterhouse: it's vital you do what you've promised to do. NEC contracts demand the right behaviour and in a world of carrots and sticks, NEC is largely full of sticks, not carrots. There are sanctions for your failure to do what you should have done. But that's what you're agreeing to do when you are either a client putting a job out to tender and appointing a contractor, or you
Nasir Khan: we do. That's good.
Patrick Waterhouse: are a tenderer that becomes the contractor. you are promising to work in a certain way and if you don't, an NEC contract will bring you to a conclusion ultimately, possibly just much more slowly and more expensively than if you have behaved the right way.
Nasir Khan: So largely full of sticks, very few carrots. Is that the genuine way
Patrick Waterhouse: Yeah.
Nasir Khan: to prevent disputes?
Patrick Waterhouse: I think so because I think the drafters of NEC are very keen that the parties work in a certain way. So if you look at something like early warnings, everyone agrees it's a terrific idea, we should all be doing it. The behaviour on projects is varied and you come across a lot of project managers or service managers who don't seem to think that is part of what they have to do, it's for the contractor. But there are clear sanctions, express sanctions for the contractors failure to give early warnings and there are indirect sanctions which are largely greater expense and delay for the client if the project manager or the service manager doesn't do it. So there's always, if you look at it in terms of carrots and sticks, if you avoid the stick, then you at least have some benefit. So if you give early warnings, if in need, if you look in the defined in the cost reimbursable options if you
Nasir Khan: Options.
Patrick Waterhouse: serve the cost forecasts you provide the information to the project manager you're likely to succeed and and be more profitable anyway.
Nasir Khan: I was delivering NEC training last week in Pakistan for for you know the the expansion of NEC globally in that regard and the training was specifically to the design team who were using professional services contract and That was a discussion that lasted for a very long time. How much and how often should early warnings be raised? I'm like, all the time, every day, if you need one, but not unnecessarily. And a
Patrick Waterhouse: day.
Nasir Khan: lot of things have to be discussed, have to be put in writing. If you think that that will detrimentally or make a change to the time cost or your own resource scheduling, then you must let the employer know. And There were some very good discussions and some very articulate discussions, I think, in that regard. But but you're absolutely right. The NEC form is guiding parties to work in a certain way. It's it's an administrative tool. the carrot and sticks are sanctions in a way. If you are not doing something, you you will fall foul of it and you will of course see see the Wrong side of things, and if you are continuously administering it in the right way, then hopefully it will deliver to what you intended to do. And that's where the administration team comes into play. If and and and I asked someone about a couple of months ago, is collaboration becoming a bit of a hindrance in administering the contract? And and the answer was yeah, sometimes we become too cozy with the client team and and feel like, it's okay, we don't need to raise a formal notice, just an email or a discussion at the meeting would be enough, but it's not enough.
Patrick Waterhouse: As I said at the start of my answer to this question, good people make for good projects. And whilst NEC says everything's got to be in a form that can be read, copied and recorded, or it's got to be on the communication system, nowhere in NEC does it say you can't talk to people. And I think you should talk to people. Sometimes they're in a shared office. Sometimes they may be thousands of miles away.
Nasir Khan: I've
Patrick Waterhouse: You know, I've dealt with projects in the South Atlantic where the project office has been in the UK. But that doesn't stop people having a conversation like this one online or on the phone.
Nasir Khan: got a good projects off Atlantic, project off the landless part making work on.
Patrick Waterhouse: And sometimes it is important you make contractual messages in the formal way. But there's nothing to stop you to pick up the phone first to say, look, you're about to get this letter from us or this email. And I just wanted to explain why we're doing it. And
Nasir Khan: And what's actually that we can change Ocean sheet. Okay, so
Patrick Waterhouse: What you always have to remember is that in the future people can change. The comfortable relationship you have with the person on the other side of the table today might be replaced when he or she resigns or gets sacked or gets promoted by somebody who views life very differently. So you've always got to make sure you've done what it says in the contract. And you can't be criticised for that because that's what the two of you have agreed to do.
Nasir Khan: Yeah, exactly. I'm I'm moving to a different subject now, which is almost coming to an end of life. you've done extensive work on PFI projects,
Patrick Waterhouse: Yes.
Nasir Khan: major contractual changes, expires. Where do you see the greatest risk of disputes on these long term arrangements now.
Patrick Waterhouse: I think the greatest risk is there are significant obligations for the PFI provider at the end of the project. They have to leave the assets in a defined condition. And that is usually open to interpretation. This is often the point at which the chickens come home to roost, the maintenance hasn't been done, the client hasn't been monitoring the project properly. and suddenly we have a short period of time in which to put everything right. Now, throughout, I've been working in PFI since 1995, and in 95,
Nasir Khan: Entity five.
Patrick Waterhouse: most of the industry was just interested in building stuff. Then shortly after they'd got their done building, they worked out they had a life cycle to manage and a maintenance obligation. And the industry's moved through phases. It's now, as you rightly say, in expiry mode. In the first two phases, most sensible participants, public and private sector, were saying, look, we've got a long-term relationship. We've got 25, 30 years together. So the usual things that might lead to a claim or an argument on a short-term construction project, we're just not going to raise with the other side. We'll keep the peace because long-term it's worth it. And now we're all about to part company. If I'm a client's and you know I've been involved a lot in NHS projects recently and hospitals it has to be said I think in all of the PFI work I've done they are the most complex projects to build and maintain. So if you are a trust you're thinking well actually this contractor's done all of this maintenance particularly the fabric maintenance what we often call the hard FM for the last 25 odd years we don't even have that expertise in house because we've not
Nasir Khan: Actually, it's kind of smash. Yeah. that's why to find
Patrick Waterhouse: to do it and in a lot of places privately they'll admit we haven't even been monitoring this lot and now suddenly Project Co's going to be out of contract with us a lot of Project Co owners
Nasir Khan: what you're supposed to probably logic code.
Patrick Waterhouse: are looking to effectively wind up Project Co and walk away and the clients in these projects are thinking crikey we've only got two or three years before this lot disappear we've got to get this done And there's also been, think, PFI was largely dispute free until about 2010 when austerity came in and public sector bodies suddenly had a lot less money. But they were left with these long term agreements for projects which were allegedly gold plated. And a lot of disputes crept in after 2010. What used to be the IPA, I've forgotten their new name, sorry, they merged with another treasury body, advise public sector bodies to prepare, start preparations for expiry seven years in advance. Now, a lot of them are doing that, but a lot of finding themselves with an awful lot to do with only one or two years left. And if you're finding significant problems with your assets, they're going to take much longer than that to...
Nasir Khan: But
Patrick Waterhouse: put right. So a lot of money, relationships likely to be stretched because they're likely to end shortly, that's perfect breeding ground I'm afraid for disputes.
Nasir Khan: Okay. I should be just like. Yeah, that's the difficulty,
Patrick Waterhouse: Yeah.
Nasir Khan: especially the complexity as you mentioned around maintenance, FM records, transition of the
Patrick Waterhouse: Yeah.
Nasir Khan: skill set. And we are always talking about the delivery and maintainability of these very, very complex and large assets, especially hospitals
Patrick Waterhouse: Yeah.
Nasir Khan: education facilities as well were built quite a lot with PFI, I believe. So so
Patrick Waterhouse: Yeah.
Nasir Khan: l let's see, let's let's hope. That you know avoidance is better than cure. So
Patrick Waterhouse: Yes.
Nasir Khan: disputes are avoided in the first place and common sense shall prevail. And this is where I see when we talk about the development of skill set, you have trained construction professionals and also see what happens when projects go wrong. What
Patrick Waterhouse: Yeah.
Nasir Khan: recurring mistake should the industry have learned to avoid by now?
Patrick Waterhouse: I think I come back to needing good people, needing to retain them and needing to motivate them. Because of the nature of the work in the industry, a lot of construction projects rather than service projects, the company is a stop go, stop go. And this is a recurrent thing the industry says to the government. We see this in different cycles of development. So you and I have both had a lot of experience in the rail industry. It's very expensive to electrify railways in the UK because we keep doing it for a few years, then stopping, losing all the resources, starting in a few years later and having to train everyone and buy equipment and bring in people from outside to do it. Whereas if there was a consistent pipeline of work, it would be a lot cheaper than it has been. And these are the types of decisions that
Nasir Khan: Okay. What should you do with any as good?
Patrick Waterhouse: encourage or discourage employers from training people, supporting them. We've seen since Covid a lot of people across industry, not just construction, change the way they work. There is a continuous debate now about working from home, working in the office and whether that is efficient or not. It's very difficult to put a steel frame together on site if you're working from home.
Nasir Khan: Okay, those decrease probably that is possible. So we'd like to
Patrick Waterhouse: It's very difficult to set that steel frame out and so on. We will always be an industry, I'm pleased to say, that will need people. Even in the AI world, I think a lot of what we do may well be reconfigured, but you will still need
Nasir Khan: have to be able to have the hype possible we could do we can figure it out.
Patrick Waterhouse: boots on the ground as they often call it. And therefore people will continue to be important. The industry historically has had a varied record on developing
Nasir Khan: Well there's an option for this and ethical people can take it for developing
Patrick Waterhouse: and looking after people. Some firms in our business are excellent at it. I'm not saying across the board it's a problem, but we do lose a lot of people in the cyclical way that the construction industry is required to do business in
Nasir Khan: what you have to do with this part of the I'm not saying it wasn't obvious problem, but the construction is quite
Patrick Waterhouse: the UK.
Nasir Khan: I agree. And this is where
Patrick Waterhouse: Thank
Nasir Khan: the challenge comes in for a lot of people with pipeline, with retention of good people, training, developing them. There's a lot of, you know, graduates that I speak to regularly who are unsure of what they are going to do. I spoke about one civil engineering graduate I met last month. And he said I applied for a number of graduate jobs, couldn't find any, so I've now gone back to university and I'm doing my masters, hoping that once I finish that I will have a lot more or better opportunities.
Patrick Waterhouse: I think also on this point, we tend in this country to not get our design bottomed out before we start on site. And it's something I've seen repeatedly, and not just the design, but the contractor's construction methodology. I remember seeing John Armit, who's a sort of a grandee of the industry, speaking last year at a conference.
Nasir Khan: Yeah.
Patrick Waterhouse: And he said some of the projects he'd worked on
Nasir Khan: It's good one.
Patrick Waterhouse: with particularly with French contractors and French consultants, he said they were much better at sorting out the detailed design before it got to site. Whereas we are almost in too much of a hurry sometimes.
Nasir Khan: I think much more than much better than workflows like.
Patrick Waterhouse: And you've seen this on some very high profile projects in this country, where even to this day, several years after they started it, there hasn't been.
Nasir Khan: I I
Patrick Waterhouse: a botanical out of the design, what is it we're building and where are we building it to? And so consequently it gets very expensive.
Nasir Khan: this is something I was dealing with yesterday. So so so I have to be careful in terms of confidentiality matters, but
Patrick Waterhouse: Yes.
Nasir Khan: the key thing was we've We've got a site and we've got to complete the detail design by early next year for construction to begin. But the intrusive site survey access will not be granted until middle of next year. So you will do your detail design ready for construction based on assumptions, and then when things change on site, you will have a delay. Either we plan for that delay knowingly that there would be a bit of a delay, then you know it's okay. But if we are not planning for it, and that was the discussion I was having, that we probably just need to plan for it in terms of the detailed design and program so that it doesn't come as a surprise. Because if the design needs to change and it could be significantly changed, because it's about Arthing design and and and and and they can be complex. So l
Patrick Waterhouse: Yeah, and going back to one of your first questions about the effect of site management, it's terrifying as a main contractor seeing a bunch of operatives stood on site with expensive equipment and saying, actually, I'm going to work for you because we're not ready because we're not thought this through properly. It's absolutely terrifying. And it's one of the things that sort of colours my judgment about getting things ready before you bring people to site because it can be very expensive if you don't.
Nasir Khan: Expensive resource, b expensive to stand
Patrick Waterhouse: Yeah.
Nasir Khan: down and and be stalled for XYZ reasons. Now we have a dispute. And this is a question to Patrick in terms of what hat would you wear first? The adjudicator hat or the mediator hat?
Patrick Waterhouse: I'm a big fan of mediation and I think it's vastly underused in construction. So I would always prefer to try and mediate a dispute and I would always encourage the parties to do so. I have come across a few disputes over the years where the dispute was so stark, so black and white.
Nasir Khan: But once I use any wrong, there will be nothing to be able to do. There is a possible time.
Patrick Waterhouse: that one side was clearly in the wrong. There was nothing to mediate. If you've got two parties who accept there is a dispute and have two, who do different positions, you can sometimes reach an agreement. But adjudication does give people an answer, does enable them to get on with things afterwards, particularly on a live project. One of the problems with mediation.
Nasir Khan: And stop comes with that should be what's instead of XY. That's how.
Patrick Waterhouse: and you may discover this in your own mediation life, is you get a phone call and someone says, will you be mediator in X versus Y? And you say, yes, yes, when? well here are some dates in the next couple of weeks, can you do it? You say, can do a couple of those. And 12 months later, I'm still talking
Nasir Khan: But basically some of these that are actually quite well. But then they can be actually.
Patrick Waterhouse: to the same solicitors offering more new dates because they're still talking. They just want to avoid this. At least when somebody serves a notice of a dedication, right, we're off. It's gonna be dealt with. You might not like the answer, but you're going to get one. So it really is a matter for the parties, I think, to decide which process they want. The benefit of mediation is they retain, they both retain control. The benefit of adjudication is the time limitation. In fact, you will get a legally binding answer.
Nasir Khan: Now when a dispute requires A firm determination, of course we are going towards adjudication, arbitration or litigation. How can we help the parties realize that it's not in their control anymore and they can't negotiate themselves and they now need to move towards a firm determination or external help with mediation? What are we doing as an industry to help parties understand that?
Patrick Waterhouse: I think the answer is not enough. If you look at some standard forms they expressly state, you know, use mediation. In the UK, because of the legislation across the three jurisdictions for adjudication, you can't put anything in the way of going to adjudication. a contract can only suggest that the parties go to mediation. I'm also against forcing someone to go to mediation if they don't want to because it's just not going to work. And I have been involved in two mediations where one of the parties on each occasion turned up merely to be able to tell the judge in a costs hearing that they'd gone to mediation and they obstructed every opportunity to reach a settlement on the day. And then at five o'clock they said, what time is it? Right, we're going
Nasir Khan: I would love to report too.
Patrick Waterhouse: home. And you could see they were there just to tick the box. So
Nasir Khan: I just think.
Patrick Waterhouse: there's no point forcing mediation if
Nasir Khan: Yeah.
Patrick Waterhouse: one of the parties doesn't want to be there. The mediation will work
Nasir Khan: Yeah.
Patrick Waterhouse: where they both want to. I think particularly where there is a significant sum of money at stake the parties are likely to be represented
Nasir Khan: You could start.
Patrick Waterhouse: by lawyers. It's really up to the lawyers to advise their clients on what they do. I think some of the lack of knowledge of mediation is actually within the legal profession.
Nasir Khan: actual bank absolutely
Patrick Waterhouse: But you know, it's without prejudice, it's without risk. Nothing you say on the day will be quoted in subsequent
Nasir Khan: obviously.
Patrick Waterhouse: proceedings. And I can't see why somebody wouldn't
Nasir Khan: Okay, I'll see.
Patrick Waterhouse: do it in most circumstances. So in terms of who should do it, it's down to the parties to make their own decisions, no doubt based on legal advice. In NEC mediation isn't mentioned, but when you read the senior representatives procedure, It says the senior representatives can use any process that they see fit in order to reach an agreement. And to me that means mediation is something they can do.
Nasir Khan: Yes, definitely. I I had very interesting experience just last month conducting a mediation. The cost hearing or the trial was just a couple of weeks away. So
Patrick Waterhouse: Yes.
Nasir Khan: When I went in, of course, I I had to keep my mind with the frame, okay, it's it's going to be very challenging. The parties have already got a judgment, so it's only about cost and few other things around damages. What will happen? But to my surprise, the councils on both sides, barristers from very well reputed you know, chambers representing the parties. Actually said, you know what, if we can find a settlement, why not? And and this is where I think a lot of it is council or solicitors led, how they explain it to the parties. Because sometimes the parties are just relying on what the council is telling them. So this is where, as an industry, I think we need our legal fraternity to help out with the success of mediation, because there is quite a lot in their court. to play with in that regard. And and that's my personal experience just a couple of weeks ago. And and and really was was good. I mean, we didn't reach a settlement on the day. It took us two days. But we did reach a settlement, which meant, you know, we avoided trial and and mediation played a successful role.
Patrick Waterhouse: think also it depends the time scales the parties are interested in. Sometimes there might be the end of a financial year coming up and they want it dealt with. I did do a mediation some years ago where the contractor was clearly short of money and having stonewalled every suggestion from the client throughout the day, suddenly the two parties reached an agreement at about of a settlement of about a million pounds and then the contractor had a private meeting with me and said will you make them a offer and I thought they meant they were going to demand more and they said will you ask them
Nasir Khan: That's good.
Patrick Waterhouse: if they will accept an offer of 750,000
Nasir Khan: Sorry, all the good.
Patrick Waterhouse: provided we have funds by close of business tomorrow.
Nasir Khan: Wow.
Patrick Waterhouse: Now I took that into the other side who effectively said where do we sign? And that contractor clearly needed the money. Now
Nasir Khan: Yeah.
Patrick Waterhouse: that was at least 10 years ago and they're still trading now, a name you would recognize, but sometimes needs must.
Nasir Khan: Yes, definitely. I mean we keep on saying the same drum beat, cash flow, lifeline, blood, blood flow, oxygen,
Patrick Waterhouse: Yeah. Yeah.
Nasir Khan: everything to a contractor. Now, coming to something which I admire, respect, and always say thank you to you. I shadowed you in a complex adjudication. Now that was a terrific experience for me. to to shadow you in
Patrick Waterhouse: Bye bye.
Nasir Khan: in that regard. Now you've helped establish the ICE Adjudicator Mentoring Scheme and you continue to support aspiring adjudicators through several organizations. How's that experience for you and for aspiring adjudicators like myself?
Patrick Waterhouse: I find it really useful and the questions people ask force me to question myself. Now, we have a certain number of protections in place on the mentoring scheme because the parties are entitled to have my decision, not yours as the shadower. So I only read my mentor's decision once the period for slip rule corrections have passed. you often read somebody else's decision and say, I've not looked at it that way. All right, you know, that's different to what I thought. And it's very rarely that a mentor and I completely disagree. You know, when I say, yes, it's a valid claim, pay them five million. The other person says, no, no, nothing doing
Nasir Khan: Every one microphone.
Patrick Waterhouse: here. So we almost always coincide to a great degree. I, when I first started training to be an adjudicator, which I now have to remind myself is 21 years ago. I was stunned by what the job really involved and just some of the tactics that parties deployed and some of the things that adjudicators had to deal with. And I was fortunate that there weren't really any mentoring schemes there. I was just cheeky and wrote to lots of adjudicators and said, can I get involved? It was very useful to deal with things like spurious jurisdiction challenges and fake outrage in correspondence from parties. It was good to see that as a mentee when it didn't really matter to me. And I think it's vital that we do this. We are very keen to broaden the diversity of the adjudicators pool.
Nasir Khan: That's the rest of the exchange. I think it's I think it's fine for some.
Patrick Waterhouse: Now there's a lot of effort gone into that, particularly to get more women involved, but I think our lack of diversity is broader than that. Unfortunately, there's a lot more to deal with. And I think a lot of prospective adjudicators will look at the people who are doing the job and say, well, I can't see myself there. So this obviously isn't a job that people like me do. So the more we can help those people and say, come for a step on the ladder, I will help.
Nasir Khan: I think a lot of those couldn't be the base report. Obviously, of the people might be pushing the set one and the most analogy.
Patrick Waterhouse: you know, support you the better. And certainly the nominating bodies have been getting better at particularly getting more women on the panel. But, you know, I've been dealing with a routine progress report recently for my role at the ICE. Our panel is about 35 strong. We now have four women on it. Now, by my brief calculation, that's about 12%. So that's 38 % too little. But equally, it's four more women than we had five years ago. Now, fair play to all four of the women in question. They've all worked bloody hard to get there.
Nasir Khan: Yeah.
Patrick Waterhouse: haven't benefited from any bias whatsoever in getting them there. But there are a number of people in the industry who are supportive of adjudicators.
Nasir Khan: Yeah, you can
Patrick Waterhouse: Not everybody talks about it. I think some people are a bit shy.
Nasir Khan: The shit magnet.
Patrick Waterhouse: But I often say when I talk at conferences and so on, you know, just write to us. It doesn't have to be through the adjudication society, the ICE, the RICS. You know, if you want someone to help you, just be cheeky. Drop someone a LinkedIn message or an email. The worst they'll do is say, sorry, no, I can't help. But most of us do. And I find it a very good two-way process because I got incredible support.
Nasir Khan: Because it's probably like speech on the button. I didn't make it. I think
Patrick Waterhouse: from people. I wrote to every adjudicator within about a hundred mile radius of me that I could find and all of them but one
Nasir Khan: I know so anything.
Patrick Waterhouse: said, yeah, I'll meet you for a coffee. We'll have a chat. I'll see how it can help. And I think if we want to broaden the base of the people who are adjudicators, we've got to support everybody who's thinking of it, you know, not just the obvious candidates. And, know, there's one of the female members of the IC panel, you know, I've heard her talk about
Nasir Khan: I think we've got a problem with our channel because we've been watching out it's all the base could be the price of case issues like just working handle that's but the thing now that is the ice problem because then it has more about the patient or if issues.
Patrick Waterhouse: studying for adjudication exams with a newborn baby on her lap on the dining room table at home. You know, incredible dedication to do that when she probably had better things to be doing than worried about the housing grants, construction and regeneration.
Nasir Khan: No, I I agree. And I've always admired your commitment to diversity and inclusion. And I know Patrick it comes naturally to naturally to you. And we've had several discussions on this in in several meetings and panels, etc. So I think I think that is a fantastic way, fantastic step forward. I'm speaking to a number of people at the moment who are really, really making a difference. And and not just, you know, for the for the namesake, but really true allies and and creating opportunities for everyone on board. So I'm hoping that that will continue and we will see more diversity and inclusion with not just on panels, everywhere within the industry. So with I think diversity and inclusion brings a several certain aspect of understanding and innovation. What makes a good adjudicator beyond technical and legal knowledge?
Patrick Waterhouse: This is a difficult one because very occasionally when I'm
Nasir Khan: Yeah, patients.
Patrick Waterhouse: mentoring people I draw the conclusion this isn't for you and you never want to say that to someone and it's very difficult to justify that statement but to be a good adjudicator you've got to be able to manage yourself and motivate yourself. We're often told adjudication is very quick but actually you can end up in most adjudications with two or three weeks to write your decision after the submission
Nasir Khan: It was just and also.
Patrick Waterhouse: and that can seem like a lot of time and there's so many other ways of soaking up your time professionally and through the family and I'll just take a couple of hours to do this I'll just take the afternoon off to do that and then suddenly your decision is due in three days and you've not done enough you've got to avoid being that person You've got to be able to plan your work, stick to it. You've got to be able to manage the parties. The parties generally, with the odd exception, are good people, but they are led and represented by people whose job it is to represent them. So they will try every trick in the book. You have to manage timetable. You have to resist demands for an umpteenth. submission because the other lot have told you something that we didn't think they were going to tell you and you know this will be a breach of natural justice and your decision won't be enforceable and we won't pay you and you have to have the ability to say okay fine but I'm still cracking on the way I said I was going to. You have to be calm, you have to be measured and you have to have focus on what you're doing. Now to some extent this isn't this is certain people rather than everybody. If you've worked in a large corporates organization, you can become institutionalized. Most adjudicators, even if they are still working for a big corporate when they start adjudicating, most become self-employed like you and me eventually because you are appointed personally, they don't appoint ABC Limited as the adjudicator, they appoint Nasir Khan, Patrick Waterhouse. For people who've worked in a big organization all their life, they're often used to... everything being done for them in an administrative sense. They're not used to the computer breaking down when a decision is due out tonight. They're not used to the challenges of
Nasir Khan: Yeah.
Patrick Waterhouse: the documents being delivered to your house and you're not answering the bells.
Nasir Khan: Patrick. How adjudicators can motivate themselves. And the coolest thing that I just heard from you was how they need to be calm, measured, focused, specifically with the viewpoint that the the adjudicating parties will always have some interesting question or an interesting curveball to throw at the adjudicator. It's about how they deal with it and how they persevere with the mode of, you know, the statutory requirements that is imposed on the adjudicator.
Patrick Waterhouse: Yeah, the most parties usually want the last word. So whoever's submitted what's currently the last word, the other lot will always say, we must have the opportunity to comment on that. Because if we don't, there'll be a breach of natural justice. Now, if you read Coulson's book, there's a statement in there along the lines of neither side is entitled to more than one submission each. So if they've already had two each, they really can't claim the breach of natural justice. for their failure to be given a third go. There's also case law to that effect, but you will receive some very persuasive correspondence that's effectively threatening you if you don't allow them a further submission.
Nasir Khan: Are you using any AI tools being the adjudicator?
Patrick Waterhouse: Yes?
Nasir Khan: can we ask AI to analyze, you know, contracts, large volume of evidence and and technology? can exercise judgment and I'm I'm sure you are aware of AAA, the American Arbitration Association. they had put an AI arbitrator in place to to present and give the award. Are we are we there yet in the UK?
Patrick Waterhouse: I don't think so. If you've ever had a dispute with Amazon or with a seller on Amazon marketplace, you've been dealing with an AI dispute resolver for years. You can tell that by some of the questions they'll ask you when you say something's not been delivered or it's arrived and it was broken or it didn't work or it wasn't what they advertised. They've done that for ages. It's one thing selling you a secondhand pair of Apple iPhone headphones is another thing when you've got a 10 million pound construction dispute. Now, I don't think we can afford to be blasé and just assume that what we do is far too clever to need AI. AI does play a role,
Nasir Khan: What's
Patrick Waterhouse: but the parties have appointed the adjudicator for his or her decision, not for an AI system to do it. So if we say AI friend, look at all of these five gigabytes I've just received from the parties, is it a compensation event and if so how much is due? I don't think the parties would thank me for doing that because if they wanted the AI answer they could do it themselves. Sometimes I'll say
Nasir Khan: That's
Patrick Waterhouse: you know AI pick out certain things from this document but
Nasir Khan: Yeah. Well.
Patrick Waterhouse: I don't think you should be using AI to summarize documents without actually reading them yourself.
Nasir Khan: Okay.
Patrick Waterhouse: Because if you say AI, what are the important points in the referral? It will miss things that are important that it won't recognize as important, but you as an adjudicator will recognize. So I think you need to be careful as to what you ask AI to do and also which system you're using. So I use a system called Co-Council, which is run by Thomson Reuters. insofar as you can rely on assurances, it's confidential. So I'm not uploading client documents into the public cloud for anybody to learn from. But the decision at the end of the day has to be mine. I still have to read everything. I still have to make my own mind up. can be very good for research.
Nasir Khan: Exactly.
Patrick Waterhouse: The parties have said the case of Blogs versus Smith is important. Give me a summary of that case. Again, I will cross check one of the good things about my AI. It will give you all of the footnotes and the cross references. So you can go in and check that it's not having what the AI community call a hallucination.
Nasir Khan: Next one. h hallucination and these aspects are always a bit of a challenge and we are finding it on the news in terms of technological debate on legal aspects and people using it. And I think this is where the experience element is still needs to come into play. AI tools are very useful. I've used them in in in several areas where there is a large data set and you're trying to identify or find a few things. I mean if we look at it, Microsoft Word, the control F is AI. You know, the the the find and replace tool is AI. So so we've been using AI in in a lot of things, even if on your computer when you do, you know, on the Windows or Mac if you're using whatever Explorer, type in the file name and it will present to you all the files which has that name appearing in it. So so those things are really, really useful. Finally. Patrick, thank you so much for being here, sharing your experience, your insights and common sense with us. If you could introduce one common sense change to the construction industry today, what would it be?
Patrick Waterhouse: I think it would be to broaden the diversity of the people who work in this industry. There's huge swathes of society that traditionally are underrepresented here, not just women, a lot of ethnic minorities. And I think we are better at this than we were a few years ago, but still a long way to go. So I've followed what you've done with Muslims in Rail closely. There's some terrific ideas there, running recruitment sessions in mosques, you're finding a section of society that you might not otherwise get exposed to. There's other people you see in public view. I won't mention any names, but somebody I followed in LinkedIn for ages was campaigning heavily for better facilities on site for women. just simple things like better PPE, better toilet facilities, know, aside from all of the usual things about the unhelpful language people often use towards women on site. But the woman I'm thinking of put something on one of the latest campaigns she'd done. a man responded and said, well, why aren't you doing the same for, and I think you're saying male crane drivers and the facilities we have on site are rubbish as well.
Nasir Khan: That's it. Well, something.
Patrick Waterhouse: Annie's probably right, but I responded to him and said, look, you know, this woman's found her niche. She's campaigning very carefully for a particular group of society. If you think there's another group that is underrepresented, then go for it yourself. Annie sent me an utterly abusive and foul mouth rant by direct message when he's currently blocked. So I don't know what else he might have to say. But the more we can appeal to different sections
Nasir Khan: I know I recognize which
Patrick Waterhouse: of society, whoever they are. underrepresented, the better because there's a huge contribution, it's not just about being fair to those people, there's
Nasir Khan: But because this is not the
Patrick Waterhouse: a huge contribution they can make to our projects that we're currently missing.
Nasir Khan: Expert. Very well said, Patrick. And thank
Patrick Waterhouse: Bye.
Nasir Khan: you very much for mentioning Muslims in Rail and the work we are doing over there. And the work continues and it's it's not something that we can say. It's like health and safety messaging. I think diversity and inclusion messaging has to be in the same way. We can never
Patrick Waterhouse: Yeah.
Nasir Khan: take our foot off the gas on that. And new people come in, new decisions come in, new desires come in, new avenues come into play. And our industry as such needs constant recurring messaging in this regard. And I think it's where people like yourself, who are, you know, a true ally really, really help and support. And I I can't thank you enough for that. Really, really much appreciated. So on that, thank you, Patrick. And
Patrick Waterhouse: Well thank you very much for having me.
Nasir Khan: Yeah, I'll ask everyone to keep watching Common Sense Not So Common on your favorite podcast platform and follow us on social media for updates and behind the scenes content. Until next time, keep questioning, keep challenging, and wherever possible, keep looking for the common sense way forward. Thank you very much.
Patrick Waterhouse: Thank you.