Dispute Resolution Flashcards
1
Q
What is litigation?
A
Litigation is an adversarial dispute resolution process that is open to the public and leading to the judgement of a court.
Judgement is final and binding, subject to a right of appeal to a higher court
Specialist court -Technology and Construction Court.
2
Q
What is alternate dispute resolution?
A
Means any method of resolving civil matters without resorting to litigation
3
Q
Name the advantages of litigation
A
- Clear procedural and evidential rules
2. Ability of appeal
4
Q
Name the disadvantages of litigation
A
- Cost-Lawyer fees and Court fees
- Lengthy and time-consuming
- Judgement will be subject to appeal
- Inaccessibility-formality can be intimidating
- Inappropriateness-Adversarial nature might not be wanted
- Incapacity-court system could not cope with all disputes needing formal resolution
- Disproportionate- More expensive in value than the case is worth
- Poor PR- Proceedings are generally conducted in public
- Judge cannot be chosen therefore they may not fully understand the dispute
5
Q
Name the different types of ADR
A
Negotiation Mediation Conciliation Adjudication Arbitration Tribunals
6
Q
Explain Adjudication
A
fast, relatively affordable, but adversarial dispute resolution procedure
Provided by 3rd party adjudicator selected by the parties to the dispute.
The adjudication (result) is a legally binding process
7
Q
Explain Arbitration
A
1.Arbitration is a private, contractual form of dispute resolution
2.Formal disputes are determined by an arbitrator or an
arbitration panel selected by the parties to the dispute
3.Arbitration is an adversarial process which produces a binding award
8
Q
What is the difference between Adjudication and Arbitration ?
A
- The arbitration award is final and binding, unless agreed otherwise by the parties (Section 58(1) of the Arbitration Act 1996)
- Adjudication by contrast is binding only until the dispute is finally determined by legal proceedings or arbitration as appropriate (Section 108(3) of HGCR Act 1996)
- The aim of adjudication is to resolve disputed issues in order to enable work to continue (either indefinitely or while awaiting the decision of a judge or arbitrator).
- Arbitration is a more formal process that will usually stop the works or will happen after works are finished
- Adjudication is compulsory arbitration is agreed by parties.
- It is possible therefore for the parties in the UK construction industry to achieve the objectives set out in the Arbitration Act 1996 without recourse to arbitration at all, but by adopting suitable Adjudication procedures
- Arbitration can take years and be very expensive
- Settlement is often long after the contract handover
- Arbitration began as a simpler and cheaper alternative to the courts, but slowly can become more complicated and expensive with the employment of lawyers and barristers
9
Q
Why is litigation suitable and not suitable for particular disputes?
A
WEH
10
Q
Which acts provides for adjudication and arbitration? (Legal Frame)
A
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11
Q
What are the advantages of Adjudication?
A
- Fast
- Relatively affordable – Obtaining a judgement by way of adjudication will, in the majority of cases, be a
fraction of the cost of pursing a judgement through the courts - Legally binding
- Flexible procedure – The parties may, on agreement, extend the time limits for response depending on the complexity or volume of material to be considered
12
Q
What are the disadvantages of Adjudication?
A
- Rough justice – Given the tight time constraints adjudication can sometimes be seen be rough justice as the responding party may only have a matter of 2-3 weeks to prepare a defence to the claim brought against them
- Legal costs – Unlike the court, the adjudicator may not have the power to order the losing party to pay the winner’s legal costs
13
Q
What are the the advantages of Arbitration?
A
- Decision of Arbitrator is binding upon the parties
- Avoiding specific legal systems/national courts
- Less expensive than litigation
- Parties can choose their Arbitrator, whereas they cannot choose their judge in litigation so it can be an individual with expertise in the area of dispute
- Parties can set some of their own rules for the conduct of the hearing and procedure and disclosure rules are relaxed (only documents that are relied on)
- Faster than litigation
- Can be done at times more convenient to the parties
- Less stressful than litigation
- Private and confidential
14
Q
What are the disadvantages of Arbitration?
A
- It is suited for high profile, complex, high-value disputes with multiple parties yet arbitration can deal only with 2 parties and the arbitrator cannot join other
parties to the dispute – overlapping arbitrations-increasing cost - Arbitrator may be specialist on technical issue but if the case turns out on a legal issue than parties would be better served by a judge
- Flexible procedures but arbitrator does not have same power as a court to insist on compliance
- Cost can escalate and can be as high as in litigation if parties do not cooperate and the arbitrator is not sufficiently strong
- Legal costs can be the same as in litigation and there is , an often significant cost of the arbitrator’s fee
- The absence of full disclosure (producing all the documents, even the ones that can be damaging to the party’s claim can make a difference between
winning and loosing
15
Q
What kind of disputes is Adjudication appropriate for?
A
- Interim payment
- Delay and disruption of the works
- Extension of time for completion of the works.
- The final account.
Originally not meant for complex claims but can relate to:
• Breach of Contract
• Termination of Contract
• Professional negligence
16
Q
What is Arbitration best used for?
A
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17
Q
What kind of disputes is Adjudication appropriate for?
A
weh
18
Q
What are the key features of Adjudication?
A
weh
19
Q
What are the key features of Arbitration?
A
weh
20
Q
Describe the Hierarchy (ADR)
A
weh
21
Q
What should you consider when choosing Litigation?
A
weh
22
Q
What is negotiation?
A
Where parties involved in dispute discuss and compromise to obtain an agreed solution
By far the most efficient and cost effective way of settling a dispute- speed, cost saving, confidentiality, preservation of relationship, range of possible solutions, control of process and outcome
23
Q
What is mediation?
A
- A structured negotiation.
- A process in which two or more people involved in a dispute meet and with the help of a neutral third party, work out a solution to their problem.
3.The mediator does not decide who is right or who is wrong. The mediator assists the parties in communicating with one another in order to meet both parties interests - Mediation emphasizes problem solving NOT
assessing blame
24
Q
What is conciliation?
A
Conciliation is similar to mediation but instead the ‘conciliator’ plays a more active role offering solutions
to the dispute
The third party actively intervenes to help the parties reach a settlement e.g by suggesting steps forward/options and the possible basis of a settlement
The Advisory Conciliation and Arbitration Service
(ACAS) can provide conciliation services
25
What is expert determination?
A neutral person is an expert in the subject is appointed to decide a dispute matter.
The decision is binding
Example: In boundary disputes where it involves the appointment of a chartered surveyor to decide the correct boundary line
26
What rights do Statutory Provisions give to construction parties? in Adjudication
1.Section 108 of the Housing Grants, Construction and
Regeneration Act 1996- Gives a statutory right for
either party to a construction contract, at any time,
to refer disputes to adjudication (also give details of
what contractual scheme must contain and if it doesn’t
then statutory scheme apply)
2.The Scheme for Construction Contracts 1998- Automatically implied contractual terms
27
Which acts are related to Arbitration?
1.Arbitration Act 1996 – applies only to agreements made in writing (has to be in contract or referenced to the contract)
2.Adjudication by contrast is binding only until the dispute is finally determined by legal proceedings or arbitration as appropriate
(Section 108(3) of HGCR Act 1996)
28
What is a Specialist Court (Technology and Construction Court)
Cases from the high court are heard in the T&C court
| Judged by a High Court judge and circuit judges
29
What do high courts deal with?
1. Cases worth more than more than £250,000
2. Involves adjudication or arbitration
3. An international dispute
30
Why is ADR preferred over litigation?
1. Quicker
2. Cheaper
3. More likely to preserve goodwill,which is especially important in situations where there is a continuing relationship
31
How long does an Adjudication last?
It operates on tight 28 day timescale and produces a decision that is temporarily binding on the parties and enforceable by summary judgment in court
32
Who is the Adjudicator?
1. adjudicator decides the judgement of the dispute.
2. The 3rd party adjudicator is selected by the parties.
3. The adjudicator must act unbiased/impartially.
33
How was Adjudication originated?
1.The Latham Report (1994) recommended adjudication
as a means of resolving disputes during the currency
of a project
2.This was brought into effect with contracts entered into after May 1998.
34
What are the Statutory Provisions of Adjudication?
Gives a statutory right for either party to a construction contract, at any time, to refer disputes to adjudication (also give details of what contractual scheme must contain and if it doesn’t then statutory scheme apply)
35
What is the source of the Statutory Provisions of Adjudication?
Section 108 of the Housing Grants, Construction and
| Regeneration Act 1996
36
What is The Scheme for Construction Contracts 1998-
| statutory scheme?
Gives a party to a construction contract the right to refer a dispute to adjudication.
Even if the provisions of adjudication is not in the contract, 'The Scheme' is implied into the contract. The Scheme is however statutory.
37
What is interim binding?
The judgement is binding until the dispute is finally determined by legal proceedings, arbitration or by agreement.
38
What cases can adjudication only be used?
```
• Interim payment
• Delay and disruption of the works
• Extension of time for completion of the works.
• The final account.
Originally not meant for complex claims but can relate to:
• Breach of Contract
• Termination of Contract
• Professional negligence
```
Mostly in service-operated contracts. Not supply contracts.
Residential occupants may be allowed to go through adjudication
39
What can the losing team do after Adjudication?
The losing team cannot use the same dispute for another Adjudication (unless both parties agree otherwise)
The losing party usually pays first before seeking to appeal the decision of the adjudicator in court proceedings or arbitration (“pay first- argue later”)
40
If a dispute occurs, can the parties go straight to an Adjudication?
The contract shall enable a party to give notice to the other party at any time, in order to dispute to Adjudication
41
When must the adjudicator be appointed?
The adjudicator must be appointed within seven days of a party referring the matter to adjudication
42
Describe the timetable of Adjudication?
1. The adjudicator must be appointed within seven days of a party referring the matter to adjudication
2. The adjudicator must reach a decision within 28 days of referral
3. An extra 14 days may be allowed if the referring party agrees. (It can only be extended further if both parties agree)
4. A referring party will normally carefully prepare its case for submission before sending off the referral notice. Such preparation time will be to the advantage of the referring party and could be planned to catch the respondent party unawares
43
What are the adjudication provisions under the Act?
1. The contract shall enable a party to give notice to the other party at any time, in order to dispute to Adjudication
2. Provide a timetable. The parties timetable must be given to set out an appointment with an Adjudicator
3. A referral of the Adjudication must be given to the other parties and Adjudicator within 7 days of giving notice.
4. The adjudicator must reach a decision within 28 days of referral although an extra 14 days may be allowed if the referring party agrees.
44
What is the difference between a notice and referral?
Notice- Brief detail of the dispute
| Referral- Expanded detail of the dispute
45
What if the decision is incorrect due to a clerical error?
The amended act allows the Adjudicator to correct his typographical or clerical mistakes within 5 days.
46
What if the Adjudicator is wrong?
1. Nothing.
| 2. Unless the Adjudicator does not act in bad faith, the adjudicator is not liable
47
What if there are no contrary provisions in the contract?
The Scheme of Construction Contracts is applied
48
What is a crystallised dispute?
When a party disputes with another party however he provides evidence on the dispute such as showing invoices to the party. The other party must then respond within a reasonable time.
49
How do the Adjudication Rules in the contract affect the Adjudicator?
The Adjudicator must follow the rules in the contract to come under jurisdiction.
If the Adjudicator is outside of his jurisdiction, his decision will not be enforced.
50
Are meetings usual in Adjudication?
Adjudications are usually documents only however there are occasionally meetings
51
What if the other party do not reply to the referral or claim from the party?
If no response is provided the adjudicator is empowered to make an award in its absence
52
Why is adjudication useful?
The informality of adjudication has meant that parties to a construction contract can handle adjudications on their own.
Adjudication allows disputes to be resolved while works are in progress
Either party can adjudicate at any time
Adjudication is fast and can help to prevent relationships on site from deteriorating to the detriment of the project
Adjudication has the full backing of the courts.
53
What are the benefits of Arbitration?
1. Arbitration is a confidential, contractual form of dispute resolution.
2. Decision of Arbitrator is binding upon the parties
3. Allows parties to avoid specific legal systems/national courts
4. Less expensive than litigation
5. Parties can choose their Arbitrator, whereas they cannot choose their judge in litigation so it can be an individual with expertise in the area of dispute
6. Faster than litigation
7. Can be done at times more convenient to the parties
8. Less stressful than litigation
9. Private and confidential
54
Who decides the judgement of an Arbitration?
1. The Arbitrator or Arbitration Panel
2. The Arbitrator is chosen by both parties
3. The Arbitrator must act impartially
4. The Arbitrator can be a specialist in the a specific area to have a clear understanding of the dispute if the issue is technical.
55
Is the judgement of the Arbitration legally binding?
Yes.
56
Can you appeal the Arbitrators award?
Providing Arbitrators stay within the law, there is generally no appeal from the Arbitrator’s award, and the award may be enforced by the courts if necessary
57
What is the Act relating to Arbitration?
Arbitration Act 1996 – applies only to agreements made in writing (has to be in contract or referenced to the contract)
58
Can the losing party appeal the award?
Providing Arbitrators stay within the law, there is generally no appeal from the Arbitrator’s award, and the award may be enforced by the courts if necessary.
59
What are the disadvantages of Arbitration?
1.Arbitrator may be specialist on technical issue but if the case turns out on a legal issue than parties would be better served by a judge
2.Cost can escalate and can be as high as in litigation if parties do not cooperate and the arbitrator is not sufficiently strong
3.Legal costs can be the same as in litigation and there is an often significant cost of the arbitrator’s fee
4.The absence of full disclosure- producing all the documents, even the ones that can be damaging to the party’s claim can make a difference between
winning and loosing
60
What if there are multiple parties involved in the dispute?
Overlapping Arbitrations –increasing cost
| No more than two parties can be in an Arbitration. Overlapping Arbitration will be required involve other parties
61
Why might a party choose Arbitration over Adjudication?
1.Arbitration award is final and binding, unless agreed
| otherwise by the parties (Section 58(1) of the Arbitration Act 1996)
62
Why might a party choose Adjudication over Arbitration?
1. Arbitration can take years and be very expensive
| 2. Settlement is often long after the contract handover
63
What is difference between Arbitration and Adjudication binding awards?
Arbitration award is final and binding, unless agreed
otherwise by the parties
(Section 58(1) of the Arbitration Act 1996)
Adjudication by contrast is binding only until the dispute is finally determined by legal proceedings or arbitration as appropriate
(Section 108(3) of HGCR Act 1996)
64
Does Arbitration and Adjudication affect the parties relationship?
The aim of adjudication is to resolve disputed issues in order to enable work to continue (either indefinitely or while awaiting the decision of a judge or arbitrator).
Arbitration is a more formal process that will usually stop the works or will happen after works are finished
Adjudication is compulsory arbitration is agreed by parties.
65
Why is Arbitration expensive?
1. More complicated and expensive with the employment of lawyers and barristers
2. Overlapping Arbitrations means paying more fees to the Arbitrators due to more Arbitrations
3. If parties do not co-operate and the arbitrator is not sufficiently strong
4. Legal costs can be the same as in litigation and there is, an often significant cost of the arbitrator’s fee
66
What acts are related to Arbitration?
```
Arbitration Act 1996
Section 108(3) of Housing Grants, Construction and Regeneration Act (HGCR) 1996
```
67
Compare the Hierarchy of Alternative Dispute Resolution
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68
What are the 3 stages of the Hierarchy of Alternative Dispute Resolution?
Stage 1
Negotiation
```
Stage 2
Mediation
Conciliation
Neutral Evaluation
Adjudication
```
Stage 3
Arbitration
Expert Determination
Litigation
69
How do the parties go into Arbitration?
For arbitration to apply, the contract between the parties must contain a written agreement to arbitrate.
