ADR

Question 1

What is an ADR clause?

Answer 1

A clause in a contract by which the parties agree to resolve their dispute primarily by ADR methods.

ADR stands for Alternative Dispute Resolution and includes methods like mediation and arbitration.

Question 2

What may an ADR clause specify?

Answer 2

It may define a particular ADR method or specify several methods that must be exhausted before litigation.

Common methods include mediation, arbitration, and expert determination.

Question 3

What is the court’s power regarding ADR agreements?

Answer 3

The court has an inherent discretionary power to stay proceedings brought in breach of the ADR agreement.

This means the court can pause litigation to enforce the agreed ADR process.

Question 4

What must ADR clauses be to be enforceable?

Answer 4

The contractual procedure must be clear and unambiguous.

Ambiguity may lead to the court declining to enforce the clause.

Question 5

True or False: Courts have enforced mere agreements to negotiate in good faith.

Answer 5

False

Courts have historically not enforced such agreements due to lack of certainty.

Question 6

What did the court uphold in the ADR clause regarding friendly discussion?

Answer 6

The clause required parties to resolve disputes by friendly discussion in good faith before arbitration.

This highlights the court’s willingness to enforce good faith obligations.

Question 7

What is necessary for the court to grant a stay of proceedings?

Answer 7

The procedure envisaged by the contract must be sufficiently certain to be enforceable.

This means the ADR process must be clearly defined.

Question 8

What was the outcome in Sulamerica CIA Nacional de Seguros SA v Enesa Engenharia SA regarding the ADR clause?

Answer 8

The court refused to uphold the ADR clause due to lack of a clear mediation commitment.

The absence of a defined mediation process led to non-enforceability.

Question 9

What criteria did the court establish in Wah v Grant Thornton International Ltd for enforcing an ADR clause?

Answer 9

1. A sufficiently certain commitment to commence a process
2. Steps required by each party to initiate the process
3. A clearly defined process for objective determination

These criteria help ensure that the ADR process is actionable.

Question 10

What type of damages may be awarded for breach of an ADR clause?

Answer 10

Damages may consist of costs incurred due to proceedings brought in breach of the ADR clause.

These costs cannot be recovered if they could have been sought in the initial proceedings.

Question 11

What is CADR?

Answer 11

Costs Alternative Dispute Resolution, a panel set up in 2015 to resolve disputes about costs.

CADR uses various ADR processes for cost disputes.

Question 12

What methods does CADR use to resolve cost disputes?

Answer 12

It includes non-binding or binding paper assessments at remote hearings or based on submitted papers.

This serves as an alternative to court assessments of costs.

Question 13

What does ADR stand for?

Answer 13

Alternative Dispute Resolution

Question 14

What is the nature of the agreement to use ADR?

Answer 14

The use of ADR is essentially contractual

Question 15

What are the two main categories of ADR options?

Answer 15

• Adjudicative Options
• Non-Adjudicative Options

Question 16

True or False: ADR can be used without the agreement of the parties involved.

Answer 16

False

Question 17

What role does a lawyer play in ADR?

Answer 17

Advising on ADR options and criteria

Question 18

What is a key characteristic of adjudicative ADR?

Answer 18

An independent third party reaches an impartial decision

Question 19

How does adjudicative ADR differ from litigation?

Answer 19

It provides more flexibility and privacy

Question 20

What must parties agree upon in an adjudicative process?

Answer 20

• The form of the process
• The person or body to carry out the process
• Other details as chosen by the parties

Question 21

What is arbitration?

Answer 21

A process conducted by one or more arbitrators who reach a decision based on submissions from the parties

Question 22

What act regulates arbitration in England and Wales?

Answer 22

The Arbitration Act 1996

Question 23

List some attractions of arbitration.

Answer 23

• Selection of an arbitrator with expertise
• Privacy of the process
• Tailoring of the process to specific needs
• Control over submitted material
• Structured process options
• Cost-effectiveness with written submissions

Question 24

What are some potential drawbacks of arbitration?

Answer 24

• Not necessarily cost-saving
• Binding third-party decision
• Limited powers to deal with uncooperative parties
• Need for careful selection of arbitrator

Question 25

What does adjudication involve?

Answer 25

A neutral third party reaching a decision on a dispute under an agreed process

Question 26

In what contexts is adjudication most likely appropriate?

Answer 26

Specialist commercial fields

Question 27

What are the key elements of an adjudication process?

Answer 27

• Agreed process
• Binding form
• Industry-adapted procedures

Question 28

What are the benefits of adjudication?

Answer 28

• Flexibility
• Cost-effectiveness

Question 29

What is expert determination?

Answer 29

A process where an expert makes a binding decision on issues requiring specialized knowledge

Question 30

What are the advantages of using expert determination?

Answer 30

• Time and cost savings
• Flexibility

Question 31

Fill in the blank: The details of the agreement to use ADR are often _______.

Answer 31

[adaptable to meet the needs of an individual case]

Question 32

True or False: Adjudication is always low cost.

Answer 32

False

Question 33

What must be agreed in writing at the start of the expert determination process?

Answer 33

The process and matters to be considered