Insights
Choosing a dispute resolution process.
The contract usually sets the order of steps. This guide explains the options so that the clause in your contract can be understood and used.
| Process | Who decides | Is the outcome binding? | Typical use |
|---|---|---|---|
| Negotiation | The parties | Only if they sign a settlement | First step in almost every dispute |
| Mediation | The parties, assisted by a mediator who does not decide | Only if they sign a settlement agreement | Where the relationship matters, at any stage |
| Conciliation | The parties, assisted by a conciliator who may propose terms | Only if the parties accept the terms | Where a neutral’s proposal would help |
| Adjudication | An independent adjudicator | As the contract provides; usually binding until reviewed in arbitration or court | Disputes that arise during the works and need a quick decision |
| Expert determination | An expert in the subject | As the agreement provides | Technical, valuation or measurement questions |
| Dispute board | A standing panel | As the contract provides | Large or long projects |
| Arbitration | One or more arbitrators | Final and binding; court review is limited | A private alternative to court |
Questions to ask first
- What does the dispute clause in the signed contract require, and in what order?
- Are there notice periods or time limits that must be met before a step can be taken?
- How much is in dispute, and how quickly is a decision needed?
- Do the parties still need to work together after the dispute?
- Is the question mainly technical, or mainly about what the contract means?
The contract comes first
Standard forms of building and engineering contract, such as JBCC, FIDIC and NEC, contain dispute resolution clauses. Bespoke contracts may too. The signed contract determines which process applies. LEMEG Resolve reads the clause at the start of every matter.