Alternative Dispute Resolution Flashcards
If proceedings are commenced in breach of an agreement to use ADR, what 2 things is the court likely to do?
- Grant a stay of proceedings
- Award costs on an indemnity basis
What is mediation?
Confidential process where a mediator (impartial third party) facilitates the resolution of disputes
Moves between rooms each with party in
Can a mediator make a binding decision?
No - solution more likely to be commercial than a legally correct one
E.g. preferential sales rates
Court might be able to enforce settlement (depends on how it is reached)
When would mediation be used?
Re factors
- Documents/evidence not important
- Parties want to be in control of process
- Interested in a cheaper and quicker (often a single day bar preparation) solution
How are costs dealt with in mediation? Who will meet the costs of the mediation itself?
- Likely to be agreed on by parties and incorporated into settlement agreement?
- Mediator fee normally borne by parties equally - jointly and severally liable to mediator for it
Can the mediator advise parties on how to record the settlement terms?
Yes - if the parties request him to do so
What is arbitration? What is done to jurisdiction of the court when it is used?
An impartial adjudicator (who can be chosen by parties) makes a final and binding decision - jurisdiction of court is ousted
Included in contract or chosen to settle dispute
Can an award of an adjudicator be enforced?
Yes - in same manner as judgement of the court
Is just as contentious/adversarial as litigation
What are the benefits of arbitration?
- Privacy
- Easier to enforce in certain jurisdictions
- Can choose a specialist
- Flexibility of arbitration; suit needs of parties
- Faster than litigation (but typically as costly as evidence may be considered)
Can an arbitrator’s award be appealed?
On restrictive grounds: serious irregularity and on point of law
What is med-arb?
Parties initially try to mediation, then move to arbitration if unsuccessful
What is the difference between an expert determination and an expert appraisal?
Expert determination gives a binding decision, expert appraisal does not
Suitable for disputes requiring technical knowledge
How should the parties provide for an expert’s determination to be final and binding?
Including within terms of appointment a provision that it is final and binding
Rather than agreeing in writing
What is an early neutral evaluation? Is it binding?
A neutral party with specialist experience will consider evidence and provide non-binding view of case which may help parties narrow issues and settle
What is conciliation?
Independent neutral 3rd party helps resolve disputes - facilitative like mediation but can involve an evaluation
Meaning of ‘conciliatino’ vary
Will often form part of statutory/regulatory scheme
Why is ADR used?
- Court expects parties to explore ADR
- Preserves relationship between the parties
- Less expensive and time-consuming
- Greater privacy
- Less disruption to clients (may not need to search for documents, engage in as many meetings)
- Outcomes can reflect risks (avoid uncertainty of court judgement)
- Greater control over the process e.g. choose arbitrator/mediator
- Greater involvement of parties themselves
What is the role of a lawyer in ADR?
Ensure client aware of options for ADR, help pursue ADR, act within authority to settle granted by client in settlement discussions
When should a party engage in ADR?
- When a contract specifies (e.g must do so before proceedings commence)
- At particular times (e.g. almost always pursued before court proceedings)
What are factors that suggest earlier/later is better?
- Earlier - greater cost savings, improve relationships going into litigation
- Later - better understand each other’s cases and evidence available, engaging too early would mean excessive costs incurred
Where in the CPR is ADR encouraged?
- Pre-action protocols/conduct requires consideration
- Costs budget requires inclusion of some elements advising settlement
- Directions questionnaire requires legal reps to confirm they have explained the need to try to settle + option to request stay for settlement
- Case management conference - court probably wants to know steps parties have taken to engage in ADR
Can the court compel parties to engage in ADR?
No
How does a court use costs to encourage ADR?
Can reward positive and punish negative ADR behaviour in costs
Court won’t know what happened but will know it has happened
Will a successful party be punished for refusing to engage in ADR? Where is burden here?
If refusal was unreasonable - burden of proof on unsuccessful party to show why court should depart from general rule on costs
Silence in the face of offer likely to be deemed unreasonable
What does the court consider when deciding whether ADR refusal was reasonable?
- The nature of the dispute
- The merits of the case (stronger case = more justifiable)
- Extent to which other settlement methods atrtempted
- Whether ADR costs would be disproportionately high
- If delay in setting up ADR would have been prejudicial (e.g. very close to trial)
- Whether ADR had reasonable prospect of success
Can a successful party be refused costs if it did not positively suggest ADR?
Did not refuse but did not suggest
No (unless breach of court order/pre-action protocols)
What should a party do if it receives an offer to engage in ADR but perceives the merits of the offer to be low?
Respond setting out reasons for decision and explain in what different circumstances it would agree to ADR
Would be rare to indicate ADR not appropriate at any stage
Letter should be made open/without prejudice save as to costs
How is a settlement agreement recorded where proceedings have not been issued?
In a contract - one party makes payment to another
How is a settlement agreement recorded where proceedings have been issued?
- Consent order - reflects agreement, sent to court to approve and make order (brings proceedings to an end)
- Tomlin order - includes consent order which stays proceedings on terms set out in a schedule (used to record terms which cannot go into normal consent order e.g. provisiosns for future trading which court cannot order)
If the dispute involves a novel point of law for which there is no precedent, what ADR is best?
None - cannot be guided on law if there is none
