Alternative Dispute Resolution Flashcards
What is alternative dispute resolution?
These are dispute resolution processes that fall outside the scope of court litigation.
What are the advantages of ADR?
Speed – no need to follow Civil Procedure Rules
Informality – outside court
Greater opportunity for negotiation
Cost – less money than professional fees for litigation
Confidentiality
What are the main types of alternative dispute resolution?
If negotiation has failed then:
Mediation and conciliation
Independent expert determination
Adjudication
Arbitration
What happens if ARD fails to resolve the issue?
It goes to litigation, which is the process of engaging in or contesting legal action in court as a means of resolving a dispute.
What are common causes of disputes?
Errors or omission in the management of the contract
Failure by employer or contractor to understand or comply with the contractual terms
Submission of poorly drafted/unfounded claims
Poorly communicated design information
How can the risk of conflict be avoided?
Clear and robust client briefing
Identify areas of risk at the outset and set out a strategy of dealing with them
Monitor risks using a risk register
Managing expectations throughout
Early warning systems set out within the contract
Partnering techniques to foster team working and problem solving
What is independent expert determination?
An independent expert is appointed jointly by the two parties to give an expert opinion on the matter to be decided. They are appointed to investigate the dispute and receive evidence from both parties and can also use their own opinion or evidence to decide upon the award.
What are the pros and cons of independent expert determination?
Pros
- quick and cost effective
- confidential
- simple
- the dispute is decided by a subject matter expert
- can be binding if parties choose
Cons
- decision of expert enforced regardless
What is mediation?
A confidential process whereby parties to a dispute invite a neutral individual to facilitate a discussion with a view to achieving a resolution to their dispute.
What is conciliation?
The conciliator can make proposals for settlement rather than simply facilitating a discussion. A mediator is more impartial and does not take responsibility for generating solutions.
What is adjudication?
A contractual or statutory procedure for swift interim dispute resolution. It is provided by a third party adjudicator selected by the parties in dispute.
What are the pros and cons of adjudication?
Pros
- cost effective
- strict timescales (28 days following referral)
- parties jointly agree on the adjudicator
- the adjudicator is commonly a subject matter expert
cons
- not suitable for complex or high value claims
What is arbitration?
A legal proceeding under the Arbitration Act 1996 under which the arbitrator is appointed in a quasi-judicial role to reach a decision on the basis of evidence put before them, sometimes at a formal hearing.
What is required for arbitrations to apply?
For arbitration to apply, the contract between the parties must contain a written agreement to arbitrate. Many of the standard form contracts have arbitration provisions.
What are the rules for arbitration?
The Construction Industry Model Arbitration Rules (CIMAR) were drafted to comply with the Arbitration Act 1996. Those Rules were adopted by JCT as the rules for an arbitration arising under a JCT contract.
What are the pros and cons of arbitrations?
Pros
- parties are bound by the decision
- arbitrators frequently have specialise knowledge of the subject matter.
- fast
- cost effective
Cons
- The decision can be over-ruled by the Court of Appeal.
What is the difference between adjudication and arbitration?
Adjudication is carried out under a strict timescale unlike arbitration for which there is not set timeframe. Adjudication applies to all construction contracts and carried out under section 108 of the HGRCA 1996, Arbitration applies to contracts drafted to comply with the Construction Industry Model Arbitration Rules.
What is litigation?
Litigation is the process of engaging in or contesting legal action in court as a means of resolving a dispute. The court is able to enforce or determine one party’s rights or obligations
Which court deals with construction disputes?
The Technology and Construction Court (TCC) deals specifically with disputes arising in respect of construction and engineering work
What are the pre-requisites for brining an proceeding to the TCC?
The Pre-Action Protocol for Construction Disputes must usually be followed as a pre-requisite.
What is required under the Pre Action Protocol?
The claimant to issue a claim letter and attach copies of key documents such as the contract
The defendant to reply within 28 days, although that period can be extended
The claimant to reply to any new issues within 14 days.
The parties should then meet in order to discuss the issues in dispute and attempt to reach settlement on at least some aspects of the dispute.
Suggests some form of ADR should run in parallel
What are the pros and cons of litigation?
Pros
- legally binding
Cons
- expensive
- can become protracted
- public process
What is the hierarchy of dispute resolution?
Negotiation Mediation Adjudication Arbitration Litigation
