Conflict Avoidance, Management And Dispute Resolution

Question 1

What is the difference between conciliation and mediation?

Answer 1

Both non-binding.

Mediation:

• Conducted by a mediator; trained professional who is impartial and neutral
• Provides a framework and facilitates discussion

Conciliation:

• Qualified and neutral professional facilitates negotiations
• Conciliator takes a more interventionist role
• Might express an opinion or make a non-binding recommendation

Question 2

What can an organisation do to avoid conflict?

Answer 2

• Clear tender / contract documents
• Effective communication / regular reporting
• Record keeping
• Follow company procedures and policy
• Follow RICS standards, professional statements and guidance
• Follow the contract provisions
• Partnering / alliancing
• Good project management / client management / constructor management / design team management
• Quality Management System

Question 3

What is Alternative Dispute Resolution (ADR)?

Answer 3

An alternative to arbitration and litigation.

• Negotiation
• Mediation
• Adjudication

Adjudication is a statutory right

Question 4

How does the Construction Act reduce conflict within the industry?

Answer 4

• Right for periodic payments
• No “IF” contracts, so contractor must pay subbies regardless of agreement between client and MC
• Right to suspend work on non payment promotes swift payment
• Right to adjudication

Question 5

What is Negotiation?

Answer 5

• Process whereby parties work out between themselves how to resolve issues that have arisen
• Power to settle dispute rest with the parties
• Suitable for simple matters, easily resolvable, compromises made

Question 6

What is an expert witness?

Answer 6

• A person whose experience and knowledge in a field is beyond what is expected of a layman
• Makes his or her knowledge available to the court and other bodies, to help it understand the issue before it and reach a just and reasoned decision

Question 7

What is expert determination?

Answer 7

• Parties agree to refer their dispute to an impartial expert third party and will then be bound by his or her decision
• Parties can choose who is appointed
• More informal than arbitration or litigation (cheaper and simpler)
• Good for technical disputes

Question 8

What are the advantages of expert determination?

Answer 8

• Confidential
• Less adversarial
• Cost and time efficient
• Procedures can be controlled by the parties
• Expert can be appointed who is familiar with the specific technical issues

Question 9

What is adjudication?

Answer 9

• Third-party adjudicator settles the dispute
• Strict timetable for resolution, based on document submissions
• Adjudicators can take initiative in ascertaining facts and law
• No right of appeal
• Binding unless reversed by arbitration or litigation
• Adjudicator either named in contract or using a nominating body in the contract
• Both parties jointly liable for the adjudicator’s fees

Question 10

What are the timelines for adjudication?

Answer 10

• Notice of intention to adjudicate must be submitted by one party to the other
• Party issuing the notice must serve its Referral (statement of case and supporting documentation) within 7 days of notice
• Same party must also appoint an adjudicator within 7 days of notice
• Decision made within 28 days of appointment (can be extended to 42 by mutual agreement)

Question 11

What is arbitration?

Answer 11

• Lawsuit without court involvement
• Parties agree (either in contract or, through a subsequent agreement) to submit their dispute to arbitration rather than pursue litigation
• Arbitrator has power to issue a decision as to the parties’ rights and obligations, and decisions are binding on all parties

Question 12

What are the advantages and disadvantages of arbitration?

Answer 12

Advantages:

• Private
• Quick (compared to litigation)
• Parties can agree on arbitrator with expertise in the matter
• Arbitrator’s award can be enforced

Disadvantages:

• Parties must bear costs of arbitrator and venue - can make small disputes uneconomical
• Limit rights of appeal

Question 13

What is litigation?

Answer 13

• Involves one of the parties commencing a claim in the civil courts
• Nature, complexity and value of the dispute will determine which court the dispute will get heard in

Question 14

What are the advantages and disadvantages of litigation?

Answer 14

Advantages:

• Court has power to compel parties to comply with timeframes and have powers of sanctions for non-compliance
• Court has power to make orders for interim relief to protect a party’s position pending final judgment
• Defined rights of appeal

Disadvantages:

• Potentially takes longer
• Conducted in public
• Judgement subject to appeal

Question 15

What are the stages of arbitration?

Answer 15

Stage 1: Initiating the arbitration
Stage 2: Appointment of arbitrator
Stage 3: Preliminary meeting
Stage 4: Statement of claim and response
Stage 5: Discovery period
Stage 6: Interchange of evidence
Stage 7: Hearing
Stage 8: Award

Question 16

What are the three pillars of ADR?

Answer 16

The 3 Pillars of Dispute Resolution

1. Negotiation – problem solving efforts of the parties themselves.
2. Mediation or conciliation – 3rd party intervention makes a non-binding decision.
3. An adjudicative process – final outcome determined by a 3rd party who’s decision is binding.

Question 17

What is the difference between adjudication and arbitration?

Answer 17

• Adjudication is a statutory requirement
• Adjudication is quicker and cheaper than arbitration or litigation
• Adjudicators must reach a decision within 28 days. Adjudication decisions can be appealed and taken to arbitration or litigation
• Arbitration is an alternative to litigation
• Arbitration can only be used if it is stated in the contract
• Decision reached in arbitration is final and binding unless appealed
• Adjudication is confidential / private
• Arbitration is only confidential if parties agree for the case to be confidential
• Adjudication is more informal

Question 18

What are some of the advantages of ADR?

Answer 18

• Speed: takes less time than court proceedings
• Informality: outside of court.
• Greater opportunity for negotiation
• Cost: less money on professional fees that litigation
• Quality of decision making: as it’s made by experts in the field not judges

Question 19

What is the TCC? What can you tell me about them?

Answer 19

• Technology and Construction Court

- Set up to improve the way in which Construction disputes are handled for formal litigation proceedings

Question 20

What is a Dispute Recommendation Board?

Answer 20

• Sit between avoidance and dispute resolution
• 3 board members appointed at start of project
• Can be asked for a non-binding recommendation

Question 21

What is a Dispute Adjudication Board?

Answer 21

• Sit between avoidance and dispute resolution
• 3 board members appointed at start of project
• Provide formal decisions which bind the parties

Question 22

What is the Arbitration Act 1996?

Answer 22

Legal framework for arbitration, including process, the award and enforcement of that award. Based on 5 principles:

1) Fair, cost effective and fast
2) User friendly language
3) To follow Model Law where possible (harmonise national arbitration laws)