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RICS Practice Standards, UK

1st edition, information paper

An overview of comparison of disputeresolution processes in the UK

An overview and comparison of disputeresolution processes in the UKRICS information paper

1st edition

Published by the Royal Institution of Chartered Surveyors (RICS)

Surveyor Court

Westwood Business Park

Coventry CV4 8JE

UK

www.ricsbooks.com

No responsibility for loss or damage caused to any person acting or refraining from action as a result of the material included in this publication canbe accepted by the authors or RICS.

Produced by the Dispute Resolution Professional Group of the Royal Institution of Chartered Surveyors.

ISBN 978 1 84219 669 4

© Royal Institution of Chartered Surveyors (RICS) March 2011. Copyright in all or part of this publication rests with RICS, and save by prior consentof RICS, no part or parts shall be reproduced by any means electronic, mechanical, photocopying or otherwise, now known or to be devised.

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Contents

RICS Dispute Resolution Standards (the ‘Gold book’) iv

Acknowledgements iv

RICS information papers 1

1 Introduction 1

2 Terminology 3

3 General principles of dispute resolution 4

4 Negotiation – property, land and built environment sectors 5

5 Early neutral evaluation – property, land and built environment sectors 6

6 Mediation / conciliation – property, land and built environment sectors 7

7 Project mediation – built environment sector 9

8 Med-Arb – property, land and built environment sectors 10

9 Mini trial – property, land and built environment sectors 11

10 Dispute boards (dispute review boards and dispute adjudication boards) – builtenvironment sector

12

11 Construction adjudication – built environment sector 14

12 Expert determination – property, land and built environment sectors 16

13 Arbitration – property, land and built environment sectors 17

14 Litigation – property, land and built environment sectors 19

15 Administrative tribunals – property and land sectors 20

15.1 Valuation tribunal 2015.2 Residential Property Tribunal Service (RPTS) 2015.3 Lands tribunal 2015.4 Administrative tribunals generally 20

16 Specialist dispute resolution processes – property, land and built environmentsectors

22

16.1 Professional arbitration on court terms (PACT) – property and landsectors

22

16.2 RICS neighbour dispute service (NDS) – property, land and builtenvironment sectors

22

17 Summary 24

References 26

AN OVERVIEW AND COMPARISON OF DISPUTE RESOLUTION PROCESSES IN THE UK | iii

RICS Dispute Resolution Standards(The ‘Gold Book’)This information paper compliments the RICSDispute Resolution Standards (the ‘Gold Book’).Produced by the RICS Dispute ResolutionProfessional Group, the Gold Book has initiallybeen developed for the UK market.

The Gold Book is made up a series of practicestatements and guidance notes and seeks to assistthose members acting in the areas of:

+ Conflict avoidance

+ Dispute resolution, including alternative disputeresolution techniques such as arbitration,construction adjudication, independent expertdetermination and mediation

+ Expert witness and advocacy services

The Gold Book is further complimented by a rangeof additional RICS information products includingthe DR toolkit (www.rics.org/drtoolkit) andinformation papers.

Acknowledgments

This information paper has been produced by theRICS Dispute Resolution Working Group. RICSwould like to thank the following for theircontributions to this paper:

Lead authors

+ Jonathan Cope is a chartered surveyor andbarrister, and is a Director of MCMS Limited.He regularly acts as an adjudicator and expertwitness.

+ Frank Rayner is a chartered surveyor andbarrister, and is an Associate Director of MCMSLimited. He regularly acts for parties in variousforms of dispute resolution.

Contributors

+ Martin Burns, Director of RICS DisputeResolution Services;

+ James Golden, Director of Quigg GoldenLimited;

+ Bruce Maunder Taylor, Partner of MaunderTaylor;

+ Eric Mouzer, Chairman of the RICS UK DisputeResolution Professional Group Board

+ Brian Reeves, Vice-Chairman of the RICS UKDispute Resolution Professional Group Board.

iv | AN OVERVIEW AND COMPARISON OF DISPUTE RESOLUTION PROCESSES IN THE UK

RICS information papers

This is an information paper. Information papersare intended to provide information andexplanation to members of the RICS on specifictopics of relevance to the profession. Thefunction of this paper is not to recommend oradvise on professional procedure to be followedby surveyors.

It is, however, relevant to professional competenceto the extent that a surveyor should be up to dateand should have informed him or herself ofinformation papers within a reasonable time of theircoming into effect.

Members should note that when an allegation ofprofessional negligence is made against a surveyor,the court is likely to take account of any relevantinformation papers published by the RICS indeciding whether or not the surveyor has actedwith reasonable competence.

AN OVERVIEW AND COMPARISON OF DISPUTE RESOLUTION PROCESSES IN THE UK | 1

1 Introduction

Given the expense and disruption to a businesswhen a dispute arises, not to mention the potentialdamage to business relationships, disputeavoidance is paramount. The importance of clearwording in the contract, lease or other legalagreement reflecting the intentions of the parties,the identification and allocation of risk, etc. cannotbe underestimated. However, disputes aresometimes unavoidable, and when they arise theyrequire resolution. A judge once said of disputeresolution:

The obligation on our profession is to serve ashealers of human conflict. To fulfil our traditionalobligation means that we should providemechanisms that can produce an acceptableresult in the shortest possible time, with the leastpossible expense and with the minimum stresson the participants. That is what justice is allabout.1

There are many different dispute resolutionprocesses in the UK, the idea being that all of them

strive to meet these aims in different ways.However, ‘one size does not fit all’, and selectingthe wrong process can result in the oppositeoutcome; an unacceptable result in the longestpossible time, with the greatest possible expenseand maximum stress on the participants. Thepurpose of this paper is therefore to give anaccurate, non-legalistic and user-friendly overviewof the main dispute resolution processes availableto the property, land and built environment sectorsin the UK. This should assist users in selecting themost suitable dispute resolution process for theirparticular dispute.

This paper is not intended to provide a detailedanalysis of dispute resolution processes and moreinformation is available in other relevant informationpapers, guidance notes and practice statementspublished by RICS. Users should also note thatindividual processes can vary quite considerablybetween the property, land and built-environmentsectors.

2 | AN OVERVIEW AND COMPARISON OF DISPUTE RESOLUTION PROCESSES IN THE UK

2 Terminology

The following terms have been used in this paper:

+ Adjudication: in its general sense refers to theprocess by which a tribunal decides the casebefore it; this is sometimes referred to as the‘adjudicative process’. However, in the UKconstruction industry the term ‘adjudication’ isused almost exclusively to describe disputeresolution under Part II of the Housing Grants,Construction and Regeneration Act 1996(HGCRA) in England, Scotland and Wales, andunder the Construction Contracts (NorthernIreland) Order 1997 (CCO) in Northern Ireland.The term ‘adjudication’ is therefore used in thisinformation paper to refer to a process bywhich a tribunal decides the case before it, andthe term ‘construction adjudication’ is usedwhere it refers to dispute resolution under theHGCRA or CCO.

+ Tribunal: usually refers to a third party disputeresolver who decides a case using anadjudicative process. However, it can also referto an administrative tribunal, for example theLands Tribunal. Where the term ‘tribunal’ isused in this information paper it refers to a thirdparty dispute resolver, and the term‘administrative tribunal’ refers to anadministrative tribunal.


3 General principles of dispute resolution

Negotiation comes at the beginning of the disputeresolution spectrum. Negotiation is an informal andnon-binding process in which the parties retaincomplete control. The next stage is mediation. Inmediation the parties still retain control of theprocess, but the distinguishing feature fromnegotiation is the addition of a neutral third partywho aids the parties towards a settlement. It is alsoimportant to note that the mediator does notdecide the outcome, and any settlement ultimately

lies with the parties. At the opposite end of thedispute resolution spectrum are the adjudicativeprocesses. These require the parties to handcontrol to a third party dispute decider, whoultimately makes a binding decision, which isimposed on the parties. The dispute resolutionprocesses considered in this information paper aretherefore divided between three ‘pillars’, asillustrated in figure 1:

With the exception of litigation, all of the dispute resolution processes detailed in figure 1 can be describedas alternative dispute resolution (ADR), meaning that they are an alternative to litigation.

Figure 1: The three ‘pillars of dispute resolution’2


4 Negotiation – property, land andbuiltenvironment sectors

Negotiation is the simplest and most common formof dispute resolution where control of the outcomeremains with the disputing parties. Negotiation isusually the most efficient form of dispute resolutionin terms of management time and costs. Thedispute should remain confidential and, due to thenon-adversarial nature of the process, it preserves,and sometimes even strengthens, businessrelationships. Negotiation can be bilateral (betweentwo parties), or it can be multilateral (more than twoparties). The parties may appoint such legal orexpert advisors as they consider necessary and thisis often described as ‘supported negotiation’.

One of the most important aspects of negotiation isthat it can continue alongside other forms ofdispute resolution. For example, the parties mayundertake many months of preparation for the useof arbitration while at the same time negotiating asettlement, often culminating in an agreement amatter of minutes before the hearing. However, untilsettlement has been achieved, negotiations shouldbe conducted on a ‘without prejudice’ basis. Thismeans that, in the absence of a settlement,evidence of negotiations cannot usually beadduced before an arbitrator or other tribunalbefore it reaches its decision. However, evidence ofnegotiations may be adduced after the tribunal hasreached its decision as it may be relevant in theallocation of costs.

The advantages of negotiation are as follows:

+ Confidentiality – negotiation should remainconfidential

+ Cost – the cost of negotiation is likely to below, particularly if it does not involve lawyers orexperts

+ Flexibility – the parties retain control of theprocess

+ Relationships – due to its non-adversarialnature, negotiation can help to preserverelationships

+ Solutions – negotiation can result in solutionsthat would not be available in other disputeresolution processes

+ Speed – the speed of negotiation can vary froma matter of minutes to many months. However,it can be faster than other dispute resolutionprocesses.

The disadvantages of negotiation are as follows:

+ Disclosing the case – parties are oftenconcerned that an important aspect of theircase will be disclosed during the negotiation.Parties may be reluctant to acknowledgeweaknesses or uncertainties in case futureproceedings are jeopardised, which may resultin the failure of the negotiation

+ Non-binding – negotiation is a non-bindingprocess and therefore does not necessarily leadto final resolution of the dispute

+ Party costs – if no settlement is achieved, thecosts expended by the parties could potentiallybe wasted and may not be recoverable if thedispute proceeds to a more formal disputeresolution process

+ Weakness – some people argue that negotiationgives an impression of weakness. However, inreality it is more likely to demonstrate a desireto avoid the dispute escalating and arecognition of the associated costs of such anescalation.


5 Early neutral evaluation – property, landand built environment sectors

Early neutral evaluation (ENE) is where one or moreparties to a dispute seek the advice of anindependent third party, who may be a judge,lawyer or expert, to evaluate the strengths andweaknesses of their case and the likely outcomeshould it proceed to a formal dispute resolutionprocess. The process is confidential, flexible andgeared towards achieving settlement.

The evaluator can make an early non-bindingassessment of the facts as well as the law, and willgive an unbiased opinion. As ENE most oftenresults in an opinion on the merits of the case, it isan ‘evaluative’ process. Neutral evaluation by anexperienced and knowledgeable outsider maymove parties away from unrealistic positions andexpectations. This ‘reality check’ may mean thatvaluable management resources can be used moreeffectively and expensive legal costs avoided. Aswith other non-binding techniques, whether or notENE is successful depends on whether the partiesgive their full co-operation to the evaluator.

The advantages of ENE are as follows:

+ Confidentiality – ENE remains confidential in themajority of cases

+ Cost – the cost of ENE is likely to be low,particularly if it the parties do not appointlawyers or experts

+ Expertise – the appointed professional will havebeen selected for his or her knowledge andexpertise


+ Relationships – due to its non-adversarial natureENE can help to preserve relationships

+ Speed – the speed of ENE can vary. However, itcan be faster than other dispute resolutionprocesses.

The disadvantages of ENE are as follows:

+ Disclosing the case – parties are oftenconcerned that an important aspect of theircase will be disclosed during the ENE process.Parties may be reluctant to acknowledgeweaknesses or uncertainties in case futureproceedings are jeopardised. This may result inthe failure of the ENE process

+ Non-binding – ENE is usually a non-bindingprocess and therefore does not necessarily leadto final resolution of the dispute

+ Party costs – if no solution is achieved, thecosts expended by the parties could potentiallybe wasted and may not be recoverable if thedispute proceeds to a more formal disputeresolution process.


6 Mediation / conciliation – property, landand built environment sectors

Mediation and conciliation are similar and are oftenconfused with each other. Both are used when theparties to a dispute want to avoid a formal tribunaland wish to resolve their differences informally.Both mediation and conciliation are voluntary andconsensual processes. They are methods ofstructured negotiation where a third party assiststhe parties to achieve a settlement. In mediationthe mediator generally avoids expressing anopinion or recommendation and facilitates asettlement between the parties.

Mediation is therefore described as a ‘facilitative’process. In conciliation the conciliator will evaluatethe parties’ cases and make recommendationsbased on his or her view. The conciliator’srecommendations are not usually binding and areintended to assist the parties in achieving asettlement.

Conciliation is therefore described as an‘evaluative’ process. Mediation and conciliation areconfidential, flexible, quick and relativelyinexpensive. At the conclusion of the process theparties can decide whether they wish to agree tothe settlement or whether they wish to resolve thedispute by some other means.

In both processes the parties may be assisted bylegal advisors and experts. As with other non-binding techniques, whether mediation orconciliation is successful depends on whether theparties give their full co-operation and they must besincere in their willingness to compromise.

The mediator or conciliator may employ varioustechniques, but will usually assist the parties byconducting individual meetings (caucuses) as wellas holding joint sessions in a form of ‘shuttlediplomacy’. This focuses on the parties’ realinterests and strengths in an attempt to draw themtogether towards settlement. The mediator orconciliator will usually try all he or she can to keepthe parties talking and avoid a breakdown in theprocess. Both processes should therefore bechallenging for the parties. The mediator or

conciliator should be rigorous in getting to the heartof the parties’ cases, and this may result in a weakor flimsy case being exposed to harsh reality. Thiscan be difficult for the parties if their expectationshave been wildly over optimistic.

In recent times the courts have sought toencourage parties to mediate as a precondition tolitigation. In fact, wilful refusal to mediate beforelitigation can leave a party at serious risk of costssanctions.

Parties to a formal tribunal are almost invariablyseeking an award or judgment that will vindicateone party and blame the other, usually with theexplicit result of rewarding the successful party andpenalising the other. Mediation or conciliation cancreate a different outcome; for example, theprocess may conclude with:

+ an apology

+ an explanation

+ compensation

+ a commitment to change practices andprocedures; or

+ a commitment to alter behaviour.

The advantages of mediation and conciliation areas follows:

+ Confidentiality – mediation and conciliationremain confidential in the majority of cases

+ Cost – the cost of mediation and conciliation islikely to be low, particularly if the parties do notappoint lawyers or experts


+ Relationships – due to their non-adversarialnature mediation and conciliation can help topreserve relationships

+ Solutions – mediation and conciliation do nothave to follow the strict application of the lawand may result in solutions that would not beavailable in other dispute resolution processes


+ Speed – the speed of mediation andconciliation can vary. However, they can befaster than other more formal dispute resolutionprocesses.

The disadvantages of mediation and conciliationare as follows:

+ Disclosing the case – parties are oftenconcerned that an important aspect of theircase will be disclosed during the mediation orconciliation process. Parties may be reluctant toacknowledge weaknesses or uncertainties incase future proceedings are jeopardised, whichmay result in the failure of the mediation orconciliation

+ Non-binding – mediation and conciliation arenon-binding and therefore do not necessarilylead to final resolution of the dispute



7 Project mediation – built environmentsector

Project mediation is, as its name suggests, avariant of the mediation family. Its objective is toembed the mediation process into a project, and toachieve this, the contract will normally haveexpress provisions obliging the parties to sign up tothe process. Once the project is underway, one ormore project mediators are appointed and canattend project meetings on a regular basis. Thisclose involvement may help to prevent a minorquarrel festering and becoming a fully blowndispute.

Project mediation can be used on any type ofproject but is most suitable for those with multipleparties or those that are complex or of a longduration. It is also suitable for projects whereprevious experience shows that conflict and poordelivery can be expected.

The advantages of project mediation are as follows:

+ Expertise – the project mediator(s) will havebeen selected for their knowledge and expertisebefore any dispute has arisen

+ Relationships – due to its non-adversarial natureproject mediation can help to preserverelationships

+ Solutions – project mediation can result insolutions that would not be available in otherdispute resolution processes

+ Understanding – by undertaking regular sitevisits the project mediator(s) will acquire a goodworking knowledge of the project. The projectmediator(s) will therefore have a much betterunderstanding of what is going on than atribunal, which has only been appointed after adispute has arisen.

The disadvantages of project mediation are asfollows:

+ Cost – unlike ‘one-off’ dispute resolutionprocesses (such as conventional mediation), thecost of the project mediator(s) is a continuingburden, which exists from the appointment ofthe project mediator(s) until the end of theirmandate. These costs will be expended even ifno disputes arise, and the cost of projectmediation is therefore likely to bedisproportionate for smaller projects

+ Disclosing the case – parties are oftenconcerned that an important aspect of theircase will be disclosed during the projectmediation process. Parties may also bereluctant to acknowledge weaknesses oruncertainties and this may result in the failure ofthe mediation

+ Non-binding – project mediation is non-bindingand therefore does not necessarily lead to finalresolution of the dispute



8 Med-Arb – property, land and builtenvironment sectors

If the parties in dispute are seeking some sort offinality or an enforceable result then mediationprocesses alone are unlikely to meet their needsbecause they are non-binding. However, onemethod of achieving finality whilst retaining anelement of mediation is by using a hybrid processknown as ‘Med-Arb’.

Med-Arb is a two stage process which involves acombination of mediation and arbitration. It isimportant to be aware that the two processes donot ‘blend’ and are distinct from each other. TheMed-Arb process involves conferring the mediatorwith the jurisdiction to alter his or her role to that ofan arbitrator if it appears that the parties will not beable to reach a mediated settlement. If the partiesdo conclude a settlement in the mediation stagethen they will usually sign a settlement agreementwhich will be legally binding. If an agreement is notreached at the mediation stage then the processwill switch to arbitration. Once the switch has takenplace and the mediator has become an arbitrator,he or she can make a legally binding award whichis enforceable in the courts. Combining the tworoles of mediator and arbitrator is especiallydemanding and therefore the selection of a thirdparty with the right skills and experience is vital ifthe process is to have an outcome that both partiesfind acceptable. At present Med-Arb is rarely usedin the UK but may grow in the future.

The advantages of Med-Arb are as follows:

+ Confidentiality – Med-Arb remains confidentialin the majority of cases

+ Cost – the cost of Med-Arb will depend on thescale of the dispute and can be expensive;however, it may still be cheaper thanconventional arbitration

+ Finality – Med-Arb can lead to a finaldetermination of the dispute that is legallybinding

+ Expertise – the third party will have beenselected for his or her knowledge and expertise

+ Flexibility – the parties retain control over themediation part of the process

+ Relationships – because at least part of theprocess is non-adversarial, Med-Arb can helpto preserve relationships

+ Speed – the speed of Med-Arb processes canvary; however, it can be faster than other moreformal dispute resolution processes.

The disadvantages of Med-Arb are as follows:

+ Disclosing the case – parties are oftenconcerned that an important aspect of theircase will be disclosed during the mediation partof the process. Parties may be reluctant toacknowledge weaknesses or uncertainties incase the arbitration part of the proceedings arejeopardised. This may result in failure of themediation part of the process

+ Inexperience – low usage of Med-Arb in the UKmay lead to unpredictability of the outcome

+ Procedural fairness – critics say that combiningthe two roles may compromise the third party’scapacity to act because he or she may learnconfidential information in the mediation, whichmay then influence his or her view during thearbitration.


9 Mini trial – property, land and builtenvironment sectors

Like Med-Arb the mini trial is a hybrid disputeresolution process, albeit without the two distinctstages of Med-Arb. Mini trials are most often usedin major disputes involving complex questions ofmixed law and fact where the parties would preferto maintain working commercial relationships byavoiding a more formal dispute resolution processsuch as arbitration or litigation. The term ‘mini trial’is actually a misnomer because the process doesnot involve a formal trial at all. Rather, it is asettlement procedure designed to take a legaldispute and convert it into a business problem tobe resolved.

In a mini trial each party presents a summary oftheir respective cases, as they would in arbitrationor litigation, but the distinction is that the case is‘tried’ by the parties themselves. The presentationsare kept to a minimum, with the lawyers andexperts presenting a slimmed down version of theircase to the parties’ own senior management. Theaim of the process is to make senior managementaware of the strengths and weaknesses of theirown case as well as those of the other side’s case,which will hopefully lead to a willingness tonegotiate. The parties will often appoint a ‘neutraladviser’, who may have particular legal or technicalexpertise. The neutral adviser will sit with seniormanagement and take charge of the hearing.Although a mini trial can be held without a neutraladviser, a settlement is more likely to be achievedwhen a neutral adviser is appointed because he orshe will have the competence to weigh up thestrengths of the cases and can take an activeinvolvement in the negotiations if the parties needhelp to reach an agreement.

The advantages of mini trials are as follows:

+ Confidentiality – a mini trial will remainconfidential in the majority of cases

+ Cost – the cost of a mini trial will depend onthe scale of the dispute and could beexpensive. However, it is likely to be cheaperthan arbitration or litigation, particularly if themini trial has a limited timescale. Savings mayalso be achieved because senior managementcan experience a ‘reality check’, and thereforeavoid spending large sums pursuing weakcases in other proceedings


+ Solutions – a mini trial can result in solutionsthat would not be available in other disputeresolution processes

+ Relationships – because it is a consensualprocess a mini trial can help to preserverelationships

+ Speed – the speed of a mini trial can vary.However, it can be faster than other, moreformal, dispute resolution processes.

The disadvantages of mini trials are as follows:

+ Disclosing the case – parties are oftenconcerned that an important aspect of theircase will be disclosed during the mini trial.Parties may be reluctant to acknowledgeweaknesses or uncertainties in case futureproceedings are jeopardised. This may result inthe failure of the mini trial

+ Non-binding – a mini trial is usually non-bindingso does not necessarily lead to final resolutionof the dispute



10 Dispute boards (dispute review boardsand dispute adjudication boards) – builtenvironment sector

The term ‘dispute boards’ (DBs) includes bothdispute review boards (DRBs) and disputeadjudication boards (DABs). DBs are common onlarge scale international construction projects, butthey have also been used on large scale domesticprojects such as the Channel Tunnel and theChannel Tunnel Rail Link, and on the constructionof the Olympic park and other venues for theLondon 2012 Olympics.

Many types of DB exist, and they are often tailoredto suit an individual project. A DB will oftencomprise three members, with each party to thecontract proposing one independent DB member atthe commencement of the project. The thirdmember is then selected by the two nominatedmembers. Ideally, the three members of the DB willhave the expertise between them to deal with mostdisputes that are likely to arise on the project; forexample, a good combination would be anengineer, a quantity surveyor and a lawyer. Theprecise procedure for the DB will usually begoverned by the applicable construction contract,but it is usually a requirement for members of theDB to make regular site visits and review projectdocumentation and reports as the projectprogresses. The DB is generally empowered toexamine all disputes, and to makerecommendations if it is constituted as a DRB ordecisions if it is constituted as a DAB.

Various organisations have published rules for DBs,including the Federation Internationale desIngenieurs-Conseils (FIDIC), the Institution of CivilEngineers (ICE) and the International Chamber ofCommerce (ICC). The ICC provides the followingexplanation of a DRB on its website(www.iccwbo.org):

The DRB issues ‘recommendations’ withrespect to any dispute referred to it andconstitutes a relatively consensual approachto dispute resolution. If no party expressesdissatisfaction with a recommendationwithin a stated time period, the parties

contractually agree to comply with therecommendation. If a party does expressdissatisfaction with the recommendationwithin such time period, that party may referthe dispute to arbitration, or if the partieshave so agreed, to the courts. Pending aruling by the arbitral tribunal or a court, theparties may voluntarily comply with therecommendation but are not bound to doso.

The ICC also provides the following explanation ofa DAB on its website (www.iccwbo.org):

The DAB issues ‘decisions’ with respect toany dispute referred to it and constitutes aless consensual approach to disputeresolution. By contractual agreement, theparties must comply with a decision withoutdelay as soon as they receive it. If a partyexpresses dissatisfaction with a decisionwithin a stated time period, it may submitthe dispute to final resolution by arbitration,if the parties have so agreed, or the courts,but the parties meanwhile remaincontractually bound to comply with thedecision unless and until the arbitral tribunalor court rules otherwise. If no partyexpresses dissatisfaction with a decisionwithin the stated time period, the partiescontractually agree to remain bound by it.

A party is therefore not contractually bound tocomply with a DRB recommendation provided itdissents within the time period set out in thecontract, but is contractually bound to comply witha DAB decision until such time as an arbitrator orcourt rules otherwise.

The advantages of DBs are as follows:

+ Confidentiality – any disputes will remainconfidential in the majority of cases

+ Expertise – the members of the DB will havebeen selected for their knowledge and expertisebefore any dispute has arisen


+ Flexibility – the parties can agree the procedurein advance and can agree any changes to itduring the course of the project

+ Prevention of disputes – the mere existence ofthe DB can prevent disputes because theparties are reluctant to be seen to be makingfrivolous claims. This is an incentive for theparties to reach a negotiated settlementthemselves

+ Relationships – because the process isconsensual and the parties have a stake in theDB, DB’s can help to preserve relationships

+ Understanding – by undertaking regular sitevisits the DB will acquire a good workingknowledge of the project. When a disputearises, the DB will have a much betterunderstanding of what is going on than atribunal which has only been appointed after adispute has arisen.

The disadvantages of DBs are as follows:

+ Cost – unlike ‘one-off’ dispute resolutionprocesses (such as mediation), the cost of theDB is a continuing burden which exists from theappointment of the DB until the end of itsmandate. These costs will be expended even ifno disputes arise and the cost of a DB istherefore likely to be disproportionate forsmaller projects

+ Enforcement – certain national courts will notenforce DB recommendations or decisions

+ Non-binding – if one of the parties does notaccept the recommendation of a DRB then adispute may not be finally resolved and mayfester and disrupt the project.


11 Construction adjudication – builtenvironment sector

Construction adjudication is the most commonform of dispute resolution in the UK constructionindustry and RICS Dispute Resolution Servicesnominates approximately 1,000 adjudicators eachyear.

This section of the paper describes constructionadjudication under Part II of the Housing Grants,Construction and Regeneration Act 1996 (HGCRA)in England, Scotland and Wales. Similar provisionsexist in Northern Ireland under the ConstructionContracts (Northern Ireland) Order 1997 (CCO). Thekey provisions of the HGCRA and the CCO are thesame, and any minor differences are irrelevant forthe purpose of this paper.

The HGCRA sets out a framework for constructionadjudication, which must be included in allconstruction contracts to which the HGCRAapplies. The HGCRA defines construction contractsas including agreements to carry out constructionoperations, as well as professional services inconnection with construction operations. TheHGCRA also contains detailed definitions of whatis, and is not, a construction operation. Althoughmost tasks fall under the definition of aconstruction operation, there are some notableexceptions, for example, off-site prefabrication. Theprovisions also do not apply to constructioncontracts with residential occupiers. Whilst at thetime this paper was written the provisions onlyapply to construction contracts that are in writing,changes to the HGCRA in the Local Democracy,Economic Development and Construction Act 2009(LDEDCA) will result in the provisions also applyingto construction contracts which have been formedeither wholly or partly verbally. However, there iscurrently no commencement date for the LDECCAso it is not known when the provisions will comeinto force.

The framework for construction adjudication, whichmust be included in a construction contract, is setout in section 108 of Part II of the HGCRA. Section108 provides that a party to a construction contract

has the right to refer a dispute arising under thecontract to construction adjudication. A disputeincludes ‘any difference’, but generally speaking adispute does not arise until it emerges that a claimis not admitted. This can be by express rejection,discussions from which it can be objectively saidthat a claim is not admitted, prevarication, orsilence. Under section 108 of Part II of the HGCRAthe construction contract must also provide for thefollowing:

+ That the parties to a construction contract cangive notice of their intention to refer a disputeto construction adjudication at any time. Thisnotice is commonly referred to as the ‘notice ofadjudication’ and should set out brief details ofthe dispute and the nature of the redresssought. A party has the right to refer a disputeto construction adjudication at any time, andthis includes after completion of theconstruction works (subject to any contractualor statutory limitations). The party referring thedispute is normally called the referring party,and the other party is normally called theresponding party.

+ A timetable with the object of securing theappointment of an adjudicator and referring thedispute to him or her within seven days of thenotice of adjudication. The parties may havealready agreed in the construction contract whothe adjudicator will be, or alternatively they mayagree after the notice of adjudication has beenissued. If the adjudicator is not pre-agreed thenthe referring party has to apply to anadjudicator nominating body (ANB), such asRICS, for the nomination of an adjudicator. Thedispute is then referred to the adjudicator in adocument commonly called the ‘referral’. Thereferral contains full details of the dispute andshould be supported by evidence. While section108 does not refer to other submissions afterthe referral, it is common for the parties toconsecutively exchange further submissions, forexample: response (responding party), reply


(referring party), rejoinder (responding party),surrejoinder (referring party), and so on

+ That the adjudicator is required to reach his orher decision within 28 days of receiving thereferral, or such longer period as is agreed bythe parties

+ That the adjudicator is allowed to extend the 28day period by up to 14 days with the consentof the referring party

+ That the adjudicator has a duty to actimpartially

+ That the adjudicator can take the initiative inascertaining the facts and the law

+ That the decision of the adjudicator is bindinguntil the dispute is finally determined by legalproceedings, by arbitration or by agreement

+ That the adjudicator shall not be liable foranything done or omitted in the discharge of hisor her functions as adjudicator

+ That, if the construction contract does notcomply with the requirements set out in section108, the provisions of the Scheme forConstruction Contracts (England and Wales)Regulations 1998 (the scheme) will apply(different schemes also exist for NorthernIreland and Scotland). Many standard andbespoke forms of construction contract simplyrefer to the scheme and others contain detailedconstruction adjudication provisions whichcomply with section 108. However, if theseprovisions do not comply with section 108, or ifno provisions are included in the constructioncontract at all, then the scheme sets outdetailed provisions, which are implied into thecontract.

There is no appeal against the decision of anadjudicator. If a losing party does not comply withan adjudicator’s decision then it is up to thesuccessful party to commence court proceedingsto enforce it. The courts have generally been verysupportive of construction adjudication throughoutthe UK, only refusing to enforce decisions wherethe adjudicator has acted in excess of his or herjurisdiction or in serious breach of the rules ofnatural justice.

The advantages of construction adjudication are:

+ Binding – the adjudicator will issue a decisionthat is binding on the parties until the dispute isfinally determined by legal proceedings, byarbitration or by agreement

+ Confidentiality – unless enforcementproceedings are commenced, the processshould remain confidential

+ Cost – the costs of construction adjudicationcan be fairly high, although constructionadjudication is relatively inexpensive comparedto other adjudicative dispute resolutionprocesses because of the short timescale

+ Expertise – the adjudicator will have beenselected for his or her knowledge and expertise

+ Flexibility – the adjudicator has some flexibilityand the parties can agree to vary the procedure

+ Party costs – unless the parties agreeotherwise, the adjudicator has no power toaward party costs. Parties therefore know that,even if they are unsuccessful, they will not beliable to meet the other parties’ costs

+ Speed – the primary advantage of constructionadjudication is the speed in which a binding(albeit temporarily) decision can be obtained

+ Statutory basis – construction adjudication hasa statutory basis and parties are thereforeunable to exclude the statutory constructionadjudication provisions from constructioncontracts. The statutory right to adjudicate alsoremains in place regardless of any other disputeresolution processes referred to in theconstruction contract, for example mediation,expert determination, etc.

The disadvantages of construction adjudication are:

+ Party costs – although the adjudicator’s lack ofpower to award costs may be an advantage formany, it can also be a disadvantage becauseparties have to bear their own costs even ifthey are successful

+ Relationships – the adversarial nature ofconstruction adjudication means thatrelationships are likely to be damaged, oftenirrevocably.


12 Expert determination – property, land andbuilt environment sectors

Expert determination is most common in theproperty and land sectors where it is often referredto as ‘independent expert determination’. Leasesoften contain provisions for the resolution of adispute by independent expert determination.However, expert determination is also becomingincreasingly popular in the built-environment sectorfor valuation and technical disputes on constructionprojects.

Expert determination involves the disputing partiesinstructing a third party expert to determine theirdispute. When entering into the contract, lease orother legal agreement the parties should agree thata dispute will be referred to an expert fordetermination. Whilst there are many parallels withother adjudicative dispute resolution processes,there are also significant differences, for example:

+ In most other adjudicative dispute resolutionprocesses, such as arbitration, the tribunalmakes a decision based on the evidencesubmitted. The tribunal can only use his or herexpertise to assess the relevance and weight ofthe evidence or arguments submitted. In expertdetermination the expert will investigate thefacts and all matters relevant to the dispute,and has to make a determination based on hisor her own knowledge and investigations,having taken into account any submissionsmade by the parties.

+ Unlike arbitration, there is no statutory right ofappeal. The expert’s determination is thereforefinal and binding. The only circumstances inwhich an expert’s determination can bechallenged is where the expert has decided thewrong issue.

+ Unlike arbitration and construction adjudication,where the arbitrator or adjudicator is not liablefor anything done in the discharge of theirduties unless it is in bad faith, an expert isliable for any losses suffered as a result of hisor her negligence.

The advantages of expert determination are:

+ Binding – the expert’s determination is binding

+ Confidentiality – expert determination shouldremain confidential in the majority of cases, anda challenge is only possible if the expert hasdecided the wrong issue

+ Expertise – the expert will have been selectedfor his or her knowledge and expertise. Unlikeother adjudicative dispute resolution processes,the expert is not restricted to only decidingwhich party’s case he or she prefers and canuse his or her expertise to reach an alternativeconclusion

+ Flexibility – the parties can agree the procedureto be adopted

+ Speed – expert determination can beconducted relatively quickly, particularly whencompared to litigation.

The disadvantages of expert determination are:

+ Binding – whilst the binding nature of anexpert’s determination can be an advantage tomany, because there is no appeal against it theparties may have no redress even if the experthas made an error of fact or law

+ Relationships – the adversarial nature of expertdetermination means that relationships may bedamaged.


13 Arbitration – property, land and builtenvironment sectors

Arbitration is common in the property and landsectors. Leases, in particular, often includeprovisions for the appointment of an arbitrator todecide disputes such as those that might ariseregarding rent reviews. The use of arbitration in theUK built environment sector has declined in recentyears due to the introduction of constructionadjudication.

The legal system that governs the procedure for anarbitration is referred to as the ‘seat’ of thearbitration. Where the seat of the arbitration isEngland, Wales or Northern Ireland it is governedby the Arbitration Act 1996 (the 1996 Act). Wherethe seat is Scotland it is governed by theArbitration (Scotland) Act 2010 (the 2010 Act). BothActs contain mandatory and discretionary parts,which allow the parties to agree how the dispute isto be resolved whilst also providing a fall-backposition if agreement cannot be reached.

Arbitration is a private dispute resolution process inwhich the parties agree to have their disputedecided by an arbitrator and to be bound by theaward that he or she makes. It is essentially analternative to litigation. The agreement to arbitrateis commonly referred to as the ‘arbitrationagreement’, and can be entered into after thedispute has arisen or, as is more often the case,included in the contract, lease or other legalagreement. Under the 1996 Act, the arbitrationagreement has to be in writing, although there is nosuch requirement for Scotland under the 2010 Act.Both Acts define the arbitration agreement as‘….an agreement to submit to arbitration present orfuture disputes…’. This definition does not restrictarbitration to contractual disputes; it can include arange of associated matters such as tortiousclaims. The arbitration agreement may also statethat the arbitration is to be conducted inaccordance with certain institutional rules, forexample the Construction Industry ModelArbitration Rules.

The arbitrator can be chosen by agreementbetween the parties, or appointed by a nominatingbody, such as RICS, identified in the contract. Both

Acts require the arbitrator to act fairly andimpartially, and to avoid unnecessary delay andexpense while conducting the arbitration.

The arbitration agreement or rules may adopt oneof a number of procedures, for example adocuments only procedure without a hearing, a fullprocedure with a lengthy hearing or a shortprocedure with a limited hearing. A procedurewithout a hearing anticipates that the arbitrator willmake his or her award based on the writtensubmissions of the parties, which are supported bydocumentary evidence. A full procedure with ahearing allows the parties to serve their statementsof case and then the arbitrator will conduct a fullhearing. The parties are often legally represented,expert witnesses may be appointed and evidenceis given under oath. Various shorter proceduresexist, including procedures limited to 100 days.

Once the parties have made their submissions, andafter any hearing is held, the arbitrator will producehis or her award. Certain minimum requirements forthe award included in the 1996 Act and 2010 Actare: it must be in writing; it must be signed by thearbitrator; it must contain reasons; it must state theseat of the arbitration and state the date on whichthe award is made. The arbitrator can makedifferent types of award; for example, an arbitratorcan issue one award on liability and quantum andthen a later award on costs. If the parties settle thedispute before the arbitrator completes his or herfinal award then the arbitrator can issue a consentaward recording the parties’ agreement. Thearbitrator usually has the power to correct certaintypographical errors in any award.

Under both Acts the arbitrator’s award is final andbinding on the parties unless they agree otherwise.The award can therefore be enforced as if it is ajudgment of the court. The parties have certainmandatory rights of appeal against the arbitrator’saward, including challenging the substantivejurisdiction of the arbitrator or challenging theaward on the basis that a serious irregularity hasbeen made. The parties can also choose whether


to include a right to appeal on a point of law.Appeals must generally be made within 28 days ofthe date of the award.

The advantages of arbitration are as follows:

+ Binding – arbitration results in a binding award,which can only be challenged in limitedcircumstances

+ Confidentiality – arbitration should remainconfidential unless an appeal in court is madeand the case is reported

+ Expertise – even if the parties cannot agree onthe name of the arbitrator, they may be able toagree the expertise and qualifications, forexample a chartered surveyor who specialisesin retail valuations for a rent review dispute on ashop, or a structural engineer for a disputeregarding alleged defects to a steel frame

+ Flexibility – arbitration can take many forms,from documents only to a full procedureincluding a hearing with witnesses, cross-examination and opening and closingspeeches. The parties are free to agreechanges to the procedure even during thearbitration and, unlike with litigation, hearingscan take place at the convenience of theparties

+ Party costs – the arbitrator has the power toaward party costs and the successful partyshould therefore recover the majority of thecosts it has expended.

The disadvantages of arbitration are as follows:

+ Cost – depending on the procedure adopted,arbitration can be a costly process. Not only dothe parties have to bear the costs of thelawyers and experts, but they will also have tobear the costs of the arbitrator and thefacilities. This compares to litigation where thejudge and court facilities are provided at publicexpense

+ Relationships – the adversarial nature ofarbitration means that relationships are likely tobe damaged, often irrevocably

+ Joinder of proceedings – unlike litigation, wherethere are more than two parties in a disputethere is relatively little statutory power toconsolidate the actions into one arbitration

+ Speed – depending on the procedure adopted,arbitration can be a slow process.


14 Litigation – property, land and builtenvironment sectors

If a consensual ADR process is not provided for inthe contract, lease or other legal agreement, andcannot be otherwise agreed, then, with theexception of a construction contract, where adispute may be referred to constructionadjudication, the only other alternative is litigation.Litigation remains common in the property, landand built environment sectors.

Litigation involves one of the parties commencing aclaim in the civil courts. However, before litigation iscommenced, the parties may be obliged to followcertain pre-action procedures. For example, inconstruction cases, the parties should follow theprocedures set out in the Pre-Action Protocol forConstruction and Engineering Disputes, whichapplies in England and Wales. Although a claim canstill be commenced without following any relevantpre-action protocol, certain costs and interestsanctions may be levied even if the claiming partyis successful.

The UK legal system is divided into three differentjurisdictions: England and Wales, Northern Ireland,and Scotland. Each jurisdiction has its own rulesfor litigation and its own court structure, forexample in England and Wales civil claims can becommenced in the County Court or High Court,whereas in Scotland claims can be commenced inthe Sheriff Court or Court of Session. The court inwhich the claim is commenced will usually dependon the value of the claim. One similarity between allof the jurisdictions is that the final court of appealfor civil claims is the UK Supreme Court.

Due to the specialist nature of some of the cases inthe property, land and built-environment sectors,many are heard by specialist judges and/or inspecialist courts. In England and Wales, forexample, property cases are often heard in theChancery Division of the High Court andconstruction cases in the Technology andConstruction Court of the Queens Bench Divisionof the High Court.

Litigation will involve a formal hearing where bothfactual and expert witnesses are examined and

cross-examined under oath in front of a judge. Thejudge will then hand down his or her judgment, andthe parties have certain rights of appeal.

The advantages of litigation are:

+ Binding – litigation results in a binding judgmentthat can be enforced by a court

+ Joinder of proceedings – the parties can applyto have separate but connected proceedingsjoined so they are heard in the same case. Thisis particularly useful in construction caseswhere the same issues may arise in casesinvolving the employer, consultants, maincontractor and sub-contractors

+ Party costs – the judge has the power to awardparty costs

+ Statutory basis – litigation has a statutory basisand is always available to the parties, unlessthey have chosen an alternative form of disputeresolution such as expert determination orarbitration. It is therefore possible to bring anunwilling party into the litigation.

The disadvantages of litigation are:

+ Confidentiality – litigation is conducted in publicand many cases are formally reported

+ Cost – litigation can be an extremely costlyprocess and, even if a party is successful, it isunlikely to recover all of its costs

+ Flexibility – litigation is inflexible and the partieshand control to the judge who decides whenthe hearing will be. There are set rules whichmust be followed, and the consequences of anyfailure to follow these rules can be fatal to thecase

+ Relationships – the adversarial nature oflitigation means that relationships are likely tobe damaged, often irrevocably

+ Speed – litigation can be a slow process takingmany months, or even years, to complete.


15 Administrative tribunals – property andland sectors

There are several administrative tribunals that dealwith property and related disputes; 15.1–15.4 givesome examples.

15.1 Valuation tribunal

The valuation tribunal is an independent appealstribunal, funded by the UK government, to hearcouncil tax and rating appeals in England. A similarservice is provided in Wales by the valuationtribunal service for Wales and in Northern Irelandby the Northern Ireland valuation tribunal. Counciltax appeals in Scotland are heard by valuationappeal committees.

15.2 Residential Property TribunalService (RPTS)

The RPTS is an umbrella body which settlesdisputes involving privately rented and leaseholdproperty in England. Three tribunals come underthe RPTS umbrella:

+ Rent assessment committees: dealing withdisputes about fair and market rents

+ Leasehold valuation tribunals (LVT): dealing withdisputes involving leasehold property, forexample, the LVT can decide the price to bepaid when a leaseholder wants to buy, extendor renew the lease on their property, or decideliability for payment of service charges, etc

+ Residential property tribunals: dealing withcertain appeals against denial of the ‘right tobuy’ scheme.

The residential property tribunal for Wales offers thesame services as the RPTS. In Scotland, rentassessment committees can make a determinationof rent or tenancy terms for an assured or short-assured tenancy. A similar role is undertaken by therent officer in Northern Ireland.

15.3 Lands tribunal

The lands tribunal in England and Wales deals withratings appeals, compulsory purchase, land

compensation, restrictive covenants, appeals fromvaluation tribunals, LVTs and RPTS (see 15.2)decisions. It is an independent judicial tribunal,funded by the UK government. Scotland andNorthern Ireland have their own lands tribunalswhich deal with similar matters.

15.4 Administrative tribunals generally

Administrative tribunals are usually made up ofbetween one and three people, appointed by thegovernment. They usually comprise a lawyer to actas chair, a lay member and a qualified member whois often a surveyor or a valuer. The members areselected for their independence and impartiality.The process will normally involve a hearing, whichis intended to be less formal than a court hearingand can be held at the offices of the administrativetribunal or at a location to suit the parties. A partyattending a hearing can represent him or herself,but lawyers are often appointed, particularly if theissues are complex. This can be expensive andcommunity legal service funding (formerly legal aid)is generally not available.

The hearings are normally open to the public andthe procedure will allow both parties to make theircase and to call witnesses if appropriate. Theadministrative tribunal members can ask questionsof the parties and any witnesses. Evidence isnormally only given under oath in the lands tribunal,and not in the valuation tribunal or RPTS.

After the administrative tribunal has heard all of thesubmissions and seen all the relevant information itwill then issue a decision in writing, usually after afew weeks. The decision must contain reasons. Asa general rule the decision will be binding on bothparties although the administrative tribunal cannotenforce it itself. Enforcement will need to be via acourt order.

The parties may appeal once a decision has beenissued, although in most cases leave to appealmust first be granted. Appeals are normallyrestricted to grounds where the administrative


tribunal has breached the rules of natural justice orhas failed to follow proper procedure.

The advantages of administrative tribunals are asfollows:

+ Binding – administrative tribunals normally issuea binding decision, which is enforceable

+ Statutory basis – many administrative tribunalshave a statutory basis and are always availableto the parties. It is therefore possible to bringan unwilling party to an administrative tribunal.

The disadvantages of administrative tribunals are asfollows:

+ Confidentiality – the hearings are normally heldin public

+ Cost – going to an administrative tribunal canbe a costly process, particularly the landstribunal

+ Flexibility – administrative tribunals have setrules which have to be followed

+ Relationships – the adversarial nature ofadministrative tribunals means that relationshipsare likely to be damaged, often irrevocably

+ Speed – many administrative tribunals havelong waiting lists.


16 Specialist dispute resolution processes –property, land and built environmentsectors

Many different specialist dispute resolutionprocesses have been set up by professional bodiesand trade associations. Two have been set up byRICS and are described in 16.1 and 16.2.

16.1 Professional arbitration on courtterms (PACT) – property and landsectors

PACT is a scheme offered by RICS and the LawSociety for the resolution of lease renewal disputes.As a result of the Regulatory Reform (BusinessTenancies) (England and Wales) Order 2003landlords and tenants no longer have to make anoriginating application to the court to resolve thesetypes of disputes and can instead use PACT.

The PACT scheme is intended to give landlords andtenants an opportunity to have the terms and rentpayable under their new lease decided by asurveyor or solicitor acting as either an arbitrator orindependent expert determiner. The professionalsappointed are experienced specialists who havebeen specifically trained under the PACT scheme.The decision made by the arbitrator or independentexpert determiner is binding on the parties.

The advantages of the PACT scheme are asfollows:

+ Binding – PACT decisions are binding on theparties

+ Confidentiality – the PACT scheme should remainconfidential in the majority of cases

+ Cost – the cost of the PACT scheme is likely tobe lower than having the matter decided incourt

+ Expertise – the PACT professional will havebeen selected for his or her knowledge andexpertise

+ Speed – the PACT scheme is usually a quickerprocess than court proceedings.

The disadvantages of the PACT scheme are asfollows:

+ Court involvement – the PACT scheme stillrequires the court to be involved atcommencement in order to agree a stay ofproceedings, thereby adding administrativecosts to the process.

16.2 RICS neighbour dispute service(NDS) – property, land and builtenvironment sectors

The NDS scheme is specifically designed to resolvea wide range of neighbour disputes. The NDSscheme is intended to be suitable for the resolutionof boundary disputes, as well as easements, rightsof way and access issues. It is intended to bequicker and cheaper than litigation, and givesneighbours the opportunity to have their disputesreviewed by a professional, appointed by RICS,who can review the issues and give independentand impartial advice. The professionals areappointed by RICS on the basis of their technicaland/or legal expertise.

The NDS scheme has three distinct stages, and afinal resolution can be achieved at any stage:

Stage 1: expert evaluation

At the first stage the appointed professional willassess the issues and provide the neighbours withan expert evaluation report. The report shouldinclude the appointed professional’s view of thesubstantive question that underlies the dispute, forexample ‘where is the boundary?’. It may be thatthe issues in dispute are resolved once the partieshave considered the evaluation report, in whichcase there may be no need for stages 2 and 3.

Stage 2: negotiation and compromise

Matters may proceed to stage 2 where, forinstance, the parties are in entrenched positions. Atstage 2 the appointed professional can use his orher experience to act as an impartial broker of a


compromise on other matters that might beperpetuating the dispute, for example: noise,access, overhanging branches, etc. The appointedprofessional will meet with the parties in order toachieve consensus if possible, but no decision willbe imposed.

Stage 3: expert witness reporting

Where the dispute is so intractable that stages 1and 2 are insufficient to resolve it, the matter mayhave to be referred to court. The appointedprofessional will produce an expert report, whichshould assist the court in deciding the dispute andshould speed up the litigation process. The expertreport only deals with the matters referred to theappointed professional at stage 1 and does notinvolve any matters dealt with at stage 2.

The advantages of the NDS scheme are asfollows:-

+ Confidentiality – the process should remainconfidential in the majority of cases

+ Cost – the cost of using the NDS scheme islikely to be lower than going to court

+ Expertise – the appointed professional will havebeen selected for his or her knowledge andexpertise

+ Flexibility – the parties retain control of theprocess until stage 3

+ Relationships – because it is a consensualprocess the NDS scheme can help to preserverelationships

+ Speed – using the NDS is often quicker thancourt proceedings.

The disadvantages of the NDS scheme are asfollows:

+ Non-binding – using the NDS scheme does notresult in a binding decision and therefore doesnot necessarily lead to the resolution of thedispute

+ Party costs – if no solution is achieved then thecosts expended by the parties could potentiallybe wasted and may not be recoverable if thedispute proceeds to a more formal disputeresolution process.


17 Summary

It is hoped that, having read this information paper,readers will have a basic understanding of the maindispute resolution processes available to theproperty, land and built environment sectors in theUK. Choosing which dispute resolution process touse will depend on many different factors, forexample:

+ whether the original legal agreement was in theproperty, land or built environment sectors

+ the parties’ budgets

+ what, if any, reference to dispute resolution isincluded in the original legal agreement

+ the stage that the dispute is at

+ the state of relations between the parties

+ how quickly the parties want the disputeresolved

+ whether the parties want the dispute to remainconfidential and whether the parties want alegally binding decision.

Some of these factors are included in figure 2overleaf, but it should be noted that each individualcase is different and the appropriateness of a givenprocess will need to be determined on a case-by-case basis.


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References

1. A quote from former Chief Justice of the United States of America, Warren Burger, referred to inProfessional Mediation of Civil Disputes, Robert Coulson, American Arbitration Association (1984).

2. Figure 1 is a development of a diagram included on page 50 of Commercial Dispute Resolution: An ADRPractical Guide, Karl Mackie, David Miles and William Marsh, Butterworths (1995). The chart was originallyderived from a chart by Professor Green of Boston University (1993).

3. Table developed from Dispute Resolution Guidance, the Office of Government Commerce, HMSO (2002).Specialist dispute resolution processes have not been included due to the many different types available.


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