Alternative Dispute Resolution

Question 1

What can a party do if they feel an arbitrator has misapplied the law?

Answer 1

The can appeal to the Hight Court to challenge the decision of the arbitrator on the basis they have wrongly applied the law.

Must be serious irregularity. Application must be made within 28 days of the award being made.

Question 2

What happens if you fail to respond to ADR?

Answer 2

This is considered unreasonable and it is likely the court will find this conduct unreasonable and impose a sanction or penalty.

Question 3

What is the criteria for whether ADR is justified?

Answer 3

• nature of the dispute
• merits of the case
• extent to which other settlement methods have been attempted
• whether the costs of the ADR would be disproportionately high
• whether any delay in setting up and attending ADR would be prejudicial
• whether the ADR had a reasonable prospect of success

Question 4

If ADR has been refused unreasonably, what sanctions are available for the court to impose?

Answer 4

Adverse costs orders, include:
- depriving a party of being awarded their costs even if they are successful in litigation
- ordering the party to pay some or all of the losing sides costs even if successful in litigation
- ordering a higher rate of interest to be paid on damages awarded by the court
- depriving a party of interest on damages awarded by the court

Question 5

Advantages and disadvantages of mediation

Answer 5

Advantages:
- flexible
- cost-effective
- speedy
- confidentail
- preserves relationships
- settlement terms can be more creative
- increases the likelihood of later negotiated settlement even if unsuccessful
- parties can return to court if a settlement is not reached

Disadvantages:
- enforceability of verbal agreements: if not in writing it is not enforceable
- all parties must agree to a proposed resolution
- can increase costs if parties are unwilling to cooperate
- parties are not required to disclose documentation
- ability to withdraw
- No ‘day in court’

Question 6

How is arbitration agreed?

Answer 6

Either before the dispute in a clause, or agree in writing to arbitrate once a dispute has arisen. Will agree

1) engage in arbitration

2) bound by the arbitrator’s decision at the conclusion of proceedings

Question 7

Advantages and disadvantages of arbitration

Answer 7

Advantages:
- Expertise of the arbitrator in subject area of dispute
- Speed
- Flexible: solution is often more pragmatic
- Confidential
- Preserves relationship: more likely to because it is confidential and solutions more pragmatic
- Binding decision
- Enforcement: party can apply to High Court to enforce a final arbitral award

Disadvantages:
- Powers are more limited
- Cost advantage over litigation is potentially small
- Limited scope to challenge decision
- Disclosure and remedies: rules relating to disclosure are not as prescriptive meaning key information could be withheld

Question 8

Advantages and disadvantages of litigation

Answer 8

Advantages:
- strict rules that govern the behaviour of parties - court can impose sanctions for misbehaviour
- Disclosure: parties are required to put all their cards on the table
- Outcome may be easier to predict if there are similar previously decided cases
- Binding decision
- Appeal: right to apply for leave to appeal
- Enforcement

Disadvantage:
- Time-consuming
- Complex to conduct without legal representation
- Costly
- Adversarial

Question 9

What are the five stage of the litigation process?

Answer 9

1. Pre-court involvement
   This is commonly referred to as the ‘pre-action conduct’ stage. The CPR contain a number of pre-action protocols and a Practice Direction on Pre-Action Conduct which guide parties on the steps to take prior to issuing proceedings
2. Commencing and defending formal proceedings
   The claimant will commence proceedings by filing a claim form with the court which will include particulars of the claim. If the defendant wishes to defend the action they will file a defence with the court and serve it on the claimant
3. Case management by the court
   Once the claim and defence have been filed with the court, a judge will allocate the claim to one of three tracks. The court will also issue directions to the parties on how they are to conduct the case and set deadlines to meet for each stage. Stages include dates by which disclosure must take place by which witness statements must be exchanged and if the parties have the courts permission to rely on expert evidence, when that evidence must be filed with the court
4. Trial
   A judge will hear all of the evidence and make an order that sets out who is liable to whom and for how much (liability and quantum). Once the judge has made their decision on liability and quantum they will then make a costs order.
5. Post-trial
   This stage is only necessary if one party disagrees with the decision and appeals it or if one party fails to pay some or all of the judgement debt.