Construction Industry dispute resolution and project management. Legally qualified independent chartered engineer providing contract advice, adjudication and arbitration services.
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On this page Alternative Dispute Resolution | Negotiation | PreAction Protocol | Mediation and Conciliation
The initials ADR stand for Alternative Dispute Resolution, or sometimes, Appropriate Dispute Resolution. It is an umbrella term usually thought to include Arbitration, Adjudication, Expert Determination, Neutral Evaluation, Mediation and Conciliation. It could also include Negotiation and the more recently introduced PreAction Protocol. Whatever form it takes the intention is to facilitate settlement of disputes without court action.
'Alternative' because it is an alternative to using the courts. Litigation is generally regarded as expensive and very often as a last resort, when relationships between the parties to a contract have broken down. If they have not, litigation may well cause commercial relations to be severed in any case. ADR often has a lower profile and can be less disruptive to business relationships.
'Appropriate' implies using means that are proportionate to the amount in dispute. The Civil Procedure Rules for court action state an overriding objective of dealing with disputes in ways which are proportionate to the amount of money involved, the importance of the case, the complexity of the issues and the financial position of each party. That can be seen as a strong endorsement of ADR.
Indeed the Civil Procedure Rules continue to say that the court should achieve the objective by encouraging the parties to use an Alternative Dispute Resolution procedure if the court considers that appropriate and by facilitating the use of such procedure. To emphasise its support the court can allow the costs of ADR to be included in the subsequent award in court.
ADR generally has a lower profile than litigation and can be cheaper and less disruptive to business and business relationships. All forms of ADR have the benefit of being conducted in private, which avoids 'washing dirty linen' in public and is more conducive to agreements being reached.
However, Arbitration has acquired much of the baggage of court action with parties represented by lawyers and relying heavily on the expert. For this reason, many parties now delete contractual provisions for arbitration. Adjudication cannot be excluded for most civil engineering and building work. It is still possible for non lawyers to achieve an inexpensive and usually a final settlement.
The preferred way of settling any contractual dispute is almost always negotiation. This can be regarded as the most basic form of ADR. It is important to understand the strengths and weaknesses of both your case and that of the other party. An outside expert opinion is beneficial both to establish the true value of a claim and decide how to proceed.
A resolution can often be achieved by presenting your case clearly and authoritatively, either in writing or in person. This can be done before time and effort is wasted on fruitless adjudication or litigation. If further action is required, the work of clearly setting out the case is never wasted. In any event, I always ensure that my client is properly informed of the benefits he can realistically achieve, the risks involved and likely costs at every stage.
The Civil Procedure Rules require parties to follow the PreAction Protocol before taking court action. This requirement is consistent with the overriding objective and can achieve the same purpose as ADR. The core requirements are the full disclosure of the case being claimed and a 'without prejudice' meeting between the parties.
If the PreAction Protocol achieves nothing else, the parties are strongly reminded to properly evaluate their positions. The intention is clearly to achieve a settlement outside the court and it can be effective.
Mediation or Conciliation is similar to negotiation in that the parties consent to the process, they can stop at any time and a binding Decision cannot be imposed against their wishes.
The parties jointly chose a mediator or conciliator. He must be independent and is probably experienced in the field so that he can understand the issues. His job is to listen to the parties separately and by probing test their position. In so doing he helps the parties to focus on the essential points in dispute and discover if there is common ground upon which to build a settlement.
Unless the parties agree to abide by his expert opinion, the mediator cannot force a settlement. Some special forms of mediation, such as that known as conciliation under the Institution of Civil Engineer's forms of contract, provide for the Conciliator to make a recommendation which becomes binding if not challenged. However, the process is little used.
Unassisted negotiation may fail because the people involved are too closely associated with the problem and have entrenched positions. Mediation often brings 'outsiders' within the organisations into the process and can concentrate minds on a settlement. It is private, inexpensive and can be very effective if there is a will to settle. Mediation may be the best chance of a resolution without the cost of and disruption of more confrontational forms of ADR or litigation.