Conflict Avoidance Management & Dispute Resolution

Question 1

What is a conflict in construction?

Answer 1

Conflicts in construction occur due to a disagreement between parties to a contract.

Question 2

What are some typical examples of sources of conflicts?

Answer 2

• poorly drafted contract documents
• lack of understanding of contractual obligations
• poor communication
• delays to payment or non-payment

Question 3

What can be result of conflicts?

Answer 3

Conflicts can vary in complexity and severity;
- breakdown of trust and relationships
- delays to a project
- additional cost
- breaches of contract and claims for damages

Question 4

How can conflicts be avoided?

Answer 4

Initially, conflicts can be avoided by ensuring basic good practice processes are in place such as;
- have clear contract documentation
- good communication between parties
- good record keeping, site activity and change control

Question 5

What are some dispute resolution techniques?

Answer 5

There are three distinct processes known as the “three pillars of dispute resolution”.
1. Negotiation
2. Mediation or conciliation
3. An adjudication process

Question 6

What would you consider before selecting a form of dispute resolution procedure?

Answer 6

• the nature and scale of dispute
• the cost of dispute in proportion to the claim
• the timescales to meet resolution
• the impact on business relationship and reputation

Question 7

Explain negotiation

Answer 7

Simplest form of dispute resolution. The parties work between themselves to resolve issues and reach agreement.
1. Prepare
2. Discuss
3. Propose
4. Bargain

Question 8

Explain mediation/conciliation

Answer 8

Parties to the dispute agree a neutral third party to facilitate discussions with a view to reach an agreement.
- must have agreement of both parties
- informal, no legal binding unless agreement is made on both sides

Question 9

What’s the main difference between mediation and conciliation?

Answer 9

With conciliation, if communications break down the conciliator prepares a recommendation for resolution. If neither party objects within a month this becomes binding.

Question 10

Explain adjudication

Answer 10

Parties select a neutral third party adjudicator who considers the claims of both parties.
- a decision is issued within 28 days (can be extended up to 14)
- decision is binding unless appealed through arbitration or litigation
- cheaper and more sensitive and arbitration/litigation

Question 11

What enforces the requirement for a contract to contain provision for adjudication and what happens if there is no provision?

Answer 11

-The Housing Grants and Regeneration Act 1996
- Parties still have an “implied” right to adjudication

Question 12

Explain arbitration?

Answer 12

Governed by the Arbitration Act.
- formal dispute resolution determined by private tribunal chosen by parties to the dispute
- not a statutory right, both parties must agree to arbitration
- decision is binding with narrow ground for appeal
- conducted in private
- expensive procedure

Question 13

Explain litigation

Answer 13

Formal procedure governed by civil procedural rules in court.
- in absence of any other procure all parties to a dispute have right to litigation
- does not require agreement of both parties
- judgment and proceedings are public record
- expensive and slow

Question 14

What is the difference between arbitration and litigation?

Answer 14

• both parties must agree to arbitration but don’t with litigation
• litigation is conducted in court and a public record. Arbitration is conducted in private.

Question 15

What is the RICS Dispute Resolution Service?

Answer 15

The RICS is the oldest and largest provider of dispute resolution services in land, property and construction. Such as; mediators, arbitrators, adjudicators, expert witnesses and more.

Question 16

What is the “Conflict Avoidance Pledge (CAP”?

Answer 16

Developed by a coalition of professional and industry bodies to demonstrate commitment to conflict avoidance and use of amicable resolution procedures at an early stage.

This captures the ethos of working collaboratively and use of early intervention techniques.

From the Construction Playbook, Government Guide on Public Works. This states the CAP should be adopted as a standard clause in all public works contracts.