Alternative Dispute Resolution (ADR) is the preferred method of resolving disputes in the construction industry, without the need for Court. ADR methods include Adjudication, Mediation, Arbitration and Expert Determination/Expert Witness, which are quicker and more cost-effective than Court proceedings. Arbicon are specialists in ADR in the construction industry and can deal with any size and type of construction dispute.
Construction
disputes often occur between Main Contractors, Subcontractors and Building
Employers, where additional works or variations arise, the works can be delayed
and an increase in costs to the project can materialise, all of which can lead
to a claim by one of the parties. ADR is regularly used to resolve disputes
concerning payment, such as interim payments, pay less notices, payment
notices, default payments, final accounts, and retention issues. It is also
used for construction delays, extension of time claims, loss and expense,
repudiatory breach of contract, contract termination, defects, practical
completion, incomplete work, design failure, variations and
often liquidated damages, bankruptcy, or insolvency.
Advantages of Using Alternative Dispute Resolution (ADR) The
best ADR method for resolving your construction dispute will depend on the
nature of the dispute and the construction contract in place. Arbicon are happy
to discuss the options with you. There are several advantages of using ADR to
resolve your construction dispute instead of Court proceedings:
Cost
With
litigation, Court proceedings, often only a fraction of costs are recoverable,
the unrecoverable court costs (sometimes 75%) might easily outstrip your claim
very quickly and spiral out of control.
Speed Unlike Court
proceedings which can be lengthy, disputes can be resolved through ADR quickly.
The leading method of ADR in the construction industry is Adjudication, which
once a dispute is started, can be resolved within 28 days.
Confidentiality ADR is
a private process between parties to the dispute and therefore it is not in the
public domain like litigation. This can
help maintain relationships between Main Contractors, Subcontractors and
Building Employers and makes the process easier. |
ADR Methods for Construction Disputes
Adjudication
is a formal, very fast and effective alternative dispute resolution (ADR)
process to end commercial construction disputes and is much cheaper than Court
proceedings. It is a specialist area of law and it is essential that any case
representation is properly advocated by experienced construction professionals.
The effective Adjudicators and Advocates are normally Chartered Quantity
Surveyors as are Arbicon, experienced in working on construction projects and
experts in the measurement and valuation of construction work and time.
The Adjudication
process generally takes 28 days and can be used in construction disputes going
into millions of pounds, irrespective of any Court proceedings that may have
already commenced.
Arbicon
has been involved in Adjudication in Construction since it started in 1998 and
can act as both a party Advocate or can appoint a Construction
Adjudicator.
Unlike
Adjudication and Arbitration there is no determination of the dispute by a
third party. The process is without prejudice and confidential. Mediation
explores the psychology of the parties in the construction dispute, allowing
the parties to step back to consider their positions to look at the behaviour
and reality of what has happened and what the result will be if the dispute
continues. The process can also recover business relations. It does need both
parties to co-operate to reach a settlement.
Arbitration
can be used in the Construction industry, where a party or parties seek a final
determination of a dispute. Unlike Court proceedings, which are similar, the
dispute is held privately and confidentially as opposed to open Court.
The Arbitrator is paid by the parties
as opposed to a Judge who is free. Legal Costs can be recovered, the Arbitrator
decides who pays the fees and the legal costs of the action depending on any
cost agreement or law in respect of "costs following the event".
Arbitration
practice and procedure is governed by statute in England, Wales and Northern
Ireland under the Arbitration Act 1996. The Act provides mandatory and optional
rights to the parties, thus guidance in setting up an Arbitration agreement and
the execution of Arbitration proceedings needs to be carefully dealt with.
Expert Determination/Expert Witness
Expert
Witness Reports can help to understand the strengths and/or weaknesses of a construction
dispute and develop the best strategy to resolve it.
Arbicon
are Chartered Quantity Surveyors and Experts in Construction Law, we can
provide Expert Determination services and Expert Witness evidence fully
compliant with RICS practice statements and Construction CPR 35 Reports for any
Court or Tribunal.
Often expert negotiation and/or the threat of formal ADR can prompt a settlement, and if not, your dispute will be evidentially set up to move forward. If you are seeking to resolve a construction dispute through ADR, even if Court proceedings have commenced, please use our contact form or call our offices below:
