Conflict Avoidance And Dispute Resolution Flashcards
How can conflicts be avoided between parties?
- clear contract documentation
- Unambiguous tender documentation
- Communication and listening skills
If a conflict occurred, how would you deal with it?
- politely, professionally and respectfully
- request a face-to-face meeting to begin negotiations in order to resolve
In your opinion, what is the cause of most disputes?
- commercial aspects and disagreements
- Unclear or conflicting specifications and drawing within scope of contract
- Teams being under pressure, leading to poor or rushed decisions
What is dispute resolution?
Dispute resolution is a method of resolving a conflict, dispute or claim
What does ADR stand for?
- Alternative Dispute Resolution
- refers to the processes and alternatives to the traditional methods of dispute resolution, such as litigation or arbitration
What are the main forms of ADR available?
- Negotiation
- Mediation
- Adjudication
If a dispute were to occur, what court would the dispute be referred to?
- The Technology and Construction Court
- The TCC would not normally handle cases with the value of less than £250k
What would indicate the success of a final account negotiation?
All parties come away happy, within the clients budget, and the negotiation is resolved in a timely manner
What is mediation?
Parties agree on an independent, third-party neutral person to facilitate discussions between them in an attempt to reach a settlement
The power of his settlement remains of the parties and the process is non-binding
The mediator does not award a winner
Can you explain what a negotiation is?
Negotiation is a process where parties work out between them how to resolve the issue that has arisen
The process requires cooperation of both parties and is a non-binding process
What is conciliation?
Conciliation is similar to mediation, being a non-binding process, where a third-party facilitates conversations in an attempt to agree
The conciliator prepares a recommendation to resolve the dispute
What is an expert witness?
A person who has extensive experience and knowledge in a field, who can make their expertise available to court or other bodies
What is expert determination?
Where parties to a contract can refer their disagreement to an impartial third-party expert
This process is more simple and cheaper than arbitration or litigation
The process is binding
Process has been essentially made redundant due to the introduction of Adjudication
What are the advantages and disadvantages of expert determination?
Advantages:
- Confidential procedure
- Reduces cost and time
- Less adversial than formal dispute resolution
Disadvantages:
- Less suited for factual disputes
- limited grounds of appeal
What is adjudication?
Adjudication was developed to allow construction contract disputes to be resolved more quickly and cost effectively than formal dispute resolution procedures
The aim of adjudication is so parties can come to a solution so they can resume and continue the work efficiently
Can you explain how the adjudication process works in terms of time frames?
- Conserve a notice to the other party for their intention to refer to adjudication
- With seven days of the notice of adjudication, the referring party must serve their statement of case (the referral - the why)
- The referral must contain detailed explanation of the referring parties claim, along with any supporting documentation
- Within these seven days, the referring party must also secure the appointment of an adjudicator
- From day seven, the adjudicator will be appointed, and will set out a timetable for information to be gathered for analysis
- The adjudicator must make his decision within 28 days of the referral
What is the maximum period for adjudication? Can this be extended?
Maximum period is 28 days
Can be extended up to 42 days by mutual agreement of both parties
Is there an appeal process with adjudication?
There is no appeal process
However, parties can refer the same dispute to litigation or arbitration
What if the building contract does not contain provisions for adjudication?
Adjudication is legal right under construction contract due to the construction act addendum 2009
Who pays for adjudication?
Both parties are jointly liable to pay the adjudicator fees, however, the adjudicator can decide who pays the fees
Is the adjudication process binding?
Yes
However, the decision may not be binding if the adjudicator acted outside their jurisdiction or was biased towards one party
What is arbitration?
Arbitration is essentially a lawsuit without court involvement.
Parties agreed to submit their dispute to arbitration rather than to pursue a lawsuit in court
The process is legally binding
Arbitration can only be referred to if there is an arbitration clause in the contract
What are the advantages and disadvantages of arbitration?
Advantages:
- Process is private
- Quicker in comparison to litigation
- Parties can agree on an arbitrator with relevant expertise in the matter
Disadvantages:
- Parties must bear the costs of both the arbitrator and venue
- Limited appeal rights
- could be considered uneconomical for smaller claims
What is litigation?
Litigation involves claims in civil court
The nature, complexity, and value of the dispute will determine which court will hear a particular dispute
What are the advantages and disadvantages of litigation?
Advantages:
- Judges can compel parties to comply with time frames
- judges have the power to make interim relief to protect the parties decision pending final judgement
- There are defined rights of appeal in cases where errors of fact or law are made
Disadvantages:
- Costly
- Public process
- Longer period to obtain judgement
- Judgement will be subject to appeal
Are you aware of any guidance and conflict avoidance published by the RICS?
I am aware of the RICS guidance on conflict avoidance and dispute resolution
What if negotiation finished and you could not reach an agreement with the contractor?
- I will consult the client to present the issue and see what their thoughts are
- I would potentially make an assessment of the cost under NEC
- I would not display the contractor from proceeding to ADR
- The client may also wish to proceed to ADR
How is NEC implemented to avoid conflict?
- language in the contract is to promote collaboration and cooperation between parties
- Timescales are implemented to ensure issues are dealt with swiftly
- The contract executes an early warning system to have a collaborative approach to risk
How can JCT be used to avoid conflict?
The GCT constructing excellence contract uses partnering to promote collaboration and integrated working
What are the available conflict avoidance options under NEC and JCT?
- NEC = Adjudication or Arbitration. NEC4 also allows contractor & client to nominate senior representatives to try and negotiate before formal proceedings are undertaken.
- JCT allows for Adjudication and Arbitration.
