Conflict Avoidance and Dispute Resolution

Question 1

What is dispute resolution?

Answer 1

A procedure which aims to resolve conflicts between parties

Question 2

What are the different forms of Alternative Dispute Resolution (ADR)?

Answer 2

Mediation
Conciliation
Negotiation
Independent expert determination

Question 3

What are the formal methods of dispute resolution?

Answer 3

Arbitration
Litigation
Adjudication

Question 4

What would your considerations be prior to selecting a form of dispute
resolution?

Answer 4

Cost of the DR in relation/proportion to the claim being sought

Timescales

Impact on business relationship (is there historical anymosity or conflict) and reputation

Question 5

What is Conciliation?

Answer 5

Similar to mediation, although a conciliator is also required to express their opinion on the dispute

The conciliators decision is not binding and their main role is to encourage diplomacy

The conciliator can not call witnesses or seek further evidence

Question 6

What is Mediation?

Answer 6

A confidential process where a neutral party facilitates negotiations between the parties

This process encourages the parties to come together and reach an agreement

Question 7

What is Negotiation?

Answer 7

Negotiation is where the parties reach an agreement through an informal private or facilitated discussion

Both parties will agree to settle the dispute either at a high level or in detail and agree to be bound by this settlement

Question 8

What is Arbitration?

Answer 8

Arbitration is private process governed by the Arbitration Act 1996 - a third party receives written evidence or verbal evidence at a hearing from the parties’ representatives and makes a legally binding decision

The arbitrator has powers of discovery (calling for disclosure of documents or witnesses to give evidence) and has power to award all costs

There are limited grounds of appeal against an Arbitrator’s award and they are not liable for negligence

Question 9

What is Litigation?

Answer 9

This is the process of parties taking legal action through the Courts, defined by the Civil Procedure Rules

Litigation is a public process so it is not possible to preserve confidentiality

Out of Court settlements may be agreed at the last minute to avoid further costs, based on the relative risks of the dispute

Question 10

What is Adjudication?

Answer 10

A statutory UK dispute resolution procedure with a timeframe of 28-42 days, which is akin to a simple arbitration

It reaches an interim binding decision until the dispute is finally determined by another process such as litigation, arbitration or mutual agreement

Question 11

What was your most successful negotiation?

Question 12

What could indicate the success of a negotiation on a final account?

Answer 12

Both parties are satisfied with the outcome and feel that a fair and reasonable compromise was reached

A partnering approach is adopted with both parties feeling as though their long-term relationships and reputations have been maintained

Question 13

What enforces the requirement for a building contract to contain
provisions for adjudication?

Answer 13

It was introduced in the Housing grants, Construction and Regeneration Act 1996 (Construction Act)

Question 14

Which contracts does adjudication apply to?

Answer 14

It applies to all construction contracts entered into after the act commenced within England, Scotland and Wales

Question 15

What are the implications if a building contract does not contain provisions for adjudication?

Answer 15

Parties still have the statutory right to adjudication assuming the contract qualifies under the construction act

Failing this the Scheme for construction contracts will apply in its entirety

Question 16

Please explain your understanding of the arbitration process?

Answer 16

Arbitration is a procedure for the resolution of disputes which is under the control of the parties

Certain conditions must be met for example a genuine dispute or difference between the parties must have occurred with an award being capable of enforcement

A binding agreement must be reached to escalate the matter to arbitration

The proceedings are undertaken in a private setting meaning the reputations of both parties can be preserved to an extent

Question 17

Can you explain the differences between arbitration and
litigation procedures?

Answer 17

Arbitration
Governed by the Arbitration Act 1996
Both parties need to agree to arbitrate
Parties have a wide degree of discretion as to how the proceedings are conducted
Procedures are similar to litigation with formal submissions by both parties, expert evidence, hearings and a decision by the arbitrator
It is a private process
Litigation
Litigation differs in that proceedings are conducted in court
It is a public process that follows civil procedure rules
Despite having high costs the process can deal with multi-party disputes and civil procedure rules which aim for accessibility, speed and efficiency

Question 18

Why do negotiations break down?

Answer 18

Money - unpaid rent, invoices or construction contract payments

Delays - in construction or in responding to other parties

Defects - professional neglience or smaller issues like snagging

Emotions/clash of personailities

Differences of professional opinion - evidence can be interpreted in different ways

Historical context

Question 19

How can disputes be avoided?

Answer 19

Managing risks and expectations

Acknowledging early warning signs and acting on them

Partnering technqiues

Clear and defined client briefings

Question 20

What is the role of the RICS in dispute resolution?

Answer 20

RICS runs the RICS Dispute Resolution Services, which is the largest provider of ADR services

RICS provides professional guidance on dispute resolution

Question 21

What is independent expert determination?

Answer 21

An independent expert is appointed by the parties to give an expert opinion on the dispute

Depending on the terms of the contract/lease, they may be required to consider evidence from the parties’ representatives, may have to give a reasoned determination and may have power to determine part/all costs

An expert’s determination is not legally binding like an arbitrator’s award and they are liable for negligence