Introduction to Arbitration: How is arbitration relevant to the Surveyor?

Glenn Haley

Thursday, 28th October 2010

© Clayton Utz

Overview

• Dealing with disputes generally

• What is arbitration / ADR?

• The phases / stages of a typical arbitration

• How is arbitration relevant to the surveyor?

Two Broad Categories of Dealing With Disputes

• What are the main “techniques”? Two broad categories:

o Avoidance or minimisation at outseto Dealing effectively with disputes that do arise

• So, at the outset, you need to decide, as a matter of principle, what are your aims and preferences

What are Your Aims and Preferences?

• Full scale argument and fully binding decision?

• Rough and ready binding decision?

• Temporary decision?

• Structured facilitation of negotiations?

• Independent input from third party, to jump start negotiations?

• Or, simply to “put off the evil day to later”?

Avoidance or Minimisation

• This is the ideal, the holy grail

• It is the ideal for which Tang and Latham say we should be striving

• Some issues and strategies:o Getting the contract documents righto Fair and appropriate allocation of risko Partneringo Effective project monitoring and project management

Getting the Contract Documents Right

• Choosing the right type of project delivery structure

• Choosing the right conditions of contract

• Choosing the right sub-contract arrangements

• Proper and careful contract drafting

• Filling out the contract schedules with care

Why have ADR at all?

“New” Style ADR Procedures??

ADR generally

• Traditional litigation

• Arbitration

• Mediation

• Adjudication

• Expert determination

• ENE

• Coin tossing?

What is (and isn’t) “Arbitration”?

• A method of dispute resolution

• An “alternative” method

• Romilly MR in Collins v Collins (1858):“An arbitration is a reference to the decision of one or more persons, either with or without an umpire, of some matters in difference between the parties.”

• This definition can apply to other forms of ADR as well

Essential Features of Arbitration

• Consensual (but binding – “stay” to arbitration)

• Party autonomy

• Jurisdiction of tribunal fixed by terms of reference

• “Judicial” nature of the proceedings

• Management of proceedings by the tribunal

• Final and legally binding process

• Limited scope for intervention by the courts

Brief History of Arbitration

• Greek / Roman references from approx 500 BC

• England 600 to 700 AD

• Commonly used in mediaeval England (but note tension between courts and arbitration)

• Merchants guilds and crafts in England

• First England arbitration legislation in 1697

Advantages / Disadvantages • Expertise of tribunal

• Privacy and confidentiality

• Speed

• Cost

• Flexibility – party autonomy, not slaves to court procedures

• Strict rules of evidence don’t apply

• Freedom of representation

• Limited rights of challenge

What procedures?

• The key is “flexibility”

• Today’s demonstration arbitration is a fairly “traditional” style hearing

• But, importantly, an arbitrator can be flexible and does not have to follow court-style procedures

• Section 2AA of the Arbitration Ordinance

• Section 2GA

Hong Kong’s “laws” of arbitration

• Arbitration Ordinance (Cap 341)

• A new ordinance is being drafted now – currently in the Bills Committee in LegCo

• UNCITRAL model law

• Domestic and international arbitrations

Types of Arbitration

• There is no exhaustive or closed list

• Flexibility is the key

• But, some common types are:o “Court” styleo Short formo Documents-only (sometimes with short hearing)o Look-sniff

Arbitration versus Litigation (1)

• What are the perceived advantages of arbitration over litigation?

o Privacy / confidentialityo Speedo Costo Expertise of tribunalo Finality

Arbitration versus Litigation (2)

• The original purpose of arbitration was to offer a practical alternative to businessmen

• But, sadly, this alternative is not always delivered

• Lawyers have done their best over the years to make arbitration “just like” the traditional litigation, with which they are comfortable

• If you make arbitration “just like” litigation, it actually becomes a more expensive option. Unlike in court, you have to pay the” judge” and pay for the “court room”!

Arbitration versus Litigation (3)

• Does arbitration have to be just like litigation?• No! The Arbitrator has wide powers (and indeed a

statutory duty) to adopt expeditious, efficient and cost-effective methods

• Examples of ways to tailor the procedure:o Chess clock arbitrationo Limited discoveryo Documents only or “small claims” procedure

The Stages of a Typical Arbitration (1)

• Drafting the arbitration clause

• Drafting the arbitration notice

• Choosing the right arbitrator

• Setting the timetable / procedures

• The pleadings / statements of case phase

The Stages of a Typical Arbitration (2)

• The interlocutory / procedural phase

• The disclosure of documents phase

• The witness statement and expert reports phase

• The substantive hearing (the “trial”)

• The arbitrator’s award (the decision)

• The enforcement / challenge phase

Roles for a Surveyor?

• As a party

• As a factual witness

• As an expert witness

• As an advisor to a party

• As an advocate (case presenter)

• As an arbitrator

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