The Dispute Resolution Centre is the only private mediation agency registered with the Mediation Board of T&T. Last year, the centre completed a successful Court-Annexed Mediation Pilot Project with the judiciary and is now focusing on transposing the successes of that project to other industries, such as the construction sector, which can be plagued with disputes. Following is a summary of a talk given by Stuart Kennedy, an attorney, arbitrator, mediator and chartered surveyor. The talk introduced various forms of alternative dispute resolution (ADR) as viable options to litigation and these may be used as alternatives or sequentially on an escalating scale.
Arbitration
Arbitration is well established within the local construction sector and is a private form of ADR. Unlike court proceedings, the parties can select the arbitrator to hear the matter. The decision or award is final and binding and can be registered as a judgement in court, although there are certain circumstances where it may be examined by the courts. Practitioners have noted that if the local Arbitration Act was updated, it would encourage more disputants to use this form of ADR. The passage of the United Kingdom's Arbitration Act, 1996, has gradually decreased the court's interference in arbitrations and gives increased powers to arbitrators, and, once robustly managed by the arbitrator, the hearing may be completed within one year and the award issued shortly thereafter.
Mediation
Mediation is another form of ADR, which is private on two levels: the entire process is confidential and any discussions between the parties and the mediator are private. But, unlike arbitration where the arbitrator determines the outcome, the mediator only facilitates the settlement of the dispute, and, in reality, it is the parties who resolve the matter. Therefore, the mediator does not give an opinion, but rather tries to get the parties closer to a settlement. In the UK, if the parties are unwilling to use mediation, their costs may not be recoverable and this has served as a strong incentive to go to mediation before litigation. In the UK, settlement from mediation ranges between 75 per cent and 80 per cent.
Conciliation
Conciliation is often described as mediation plus. The process starts out as mediation with the neutral trying to bring the parties to a common position, but, if this fails the neutral adopts, the role of a conciliator and will express a view of an appropriate settlement. It is therefore quite common for one construction contract to have an escalating dispute resolution process which may run from amicable negotiations to mediation to conciliation and then arbitration.
Adjudication
Adjudication, on the other hand, is the most popular form of ADR in the UK for resolving construction disputes and there is an implied term by statute in all construction contracts. The process produces a decision within 28 days and this fast-tracked decision gets the money flowing again in the construction process so work continues. The decision, while binding, is temporary, so the parties must comply with the decision at the point in time, and if one party disregards the decision the other side may go to court to have the decision enforced through a judgement, which may also occur within 28 days. However, if the parties disagree with the decision, it is within their right to have the same dispute escalated to arbitration or litigation. Statistically, 80 to 90 per cent of the decisions made by the adjudicator do not escalate to other formal proceedings.
Expert determination is very often used to resolve land, rent and lease disputes. With this approach, the parties appoint the expert who is free to use his expert knowledge to assess the dispute and to express an opinion, unlike arbitration or litigation, where the decision of the arbitrator or judge is based on the evidence presented by the parties. In expert determination, the decision is usually final and binding and there is very little recourse to any appeal of the decision. This is a sound method to permanently resolve construction disputes but the parties must use it for the right types of dispute and select the right expert.
Early neutral evaluation
Early neutral evaluation (ENE). The question every client asks his attorney is: "if I take this matter to court, what is the likelihood that I will win and how much will it cost?" With ENE, an independent expert evaluates the dispute as early as possible and a view is provided which is non-binding. While the opinion may be disregarded by the parties, the major advantage of this approach is that it educates each side on the matters under dispute by providing a reality check of what the dispute is all about, the strengths and weaknesses of the case and an opportunity for informal discussions by the parties, which often leads to settlement.
Dispute Adjudication Board
Dispute Adjudication Board (DAB) or Dispute Review Board (DRB) may comprise of one or three persons, and is useful in major projects. With this approach, because the board or person is appointed early in the project and stays for the duration, the board knows the parties, have visited the worksite and has a first-hand understanding of the project and therefore any disputes which may arise. The DAB may offer a binding decision or just a view, but, most importantly, it allows for disputes to be handled at appropriate times during the project and not stalled until the end when there is accumulated baggage and complexity. The DAB breaks down disputes as they arise making resolution quicker and more likely and translates into cost savings.
Clearly, the above ADR options are quicker and usually cheaper to litigation and offer flexibility and confidentiality. They produce high success rates and allow the parties to select the best approach to fit the dispute at hand and appoint the best neutral to handle the dispute. In dealing with concerns of neutrality, in light of the size of the local market, the DRC is currently setting up a panel of mediators and arbitrators representative of the Caribbean while independent of influences of the respective islands. The DRC already has an impressive cadre of local and international mediators and arbitrators with the appropriate infrastructure to facilitate all forms of ADR. The centre provides the relevant training and invites our local and regional construction experts to apply to serve on the DRC's specialised rosters.