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M006 Conflict of interest
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Mind Map on M006 Conflict of interest, created by alison_patey0437 on 29/04/2013.
Mind Map by
alison_patey0437
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alison_patey0437
over 11 years ago
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Resource summary
M006 Conflict of interest
Standard form of contract deal with Conflict avoidance and DR
ICE, NEC & JCT have adopted adjudication
effecive after incorporation of HGCRA Act 1996
now statutory requirement of UK contracts
decision in 28 days
difference between UK Adjudication and FIDIC adjudication
UK requirement based on statue
FIDIC is a contract based requirement
FIDIC 1999 form of contract inc DAB (dispute Adjudication Boards) provision 1 or 3 members. its contractual and all parties to abide by decision
DAB provision
standing disputes board
standing body and visits site reg.
84 days 2 make a decision
decision is final and binding if no notice of disatifaction if given
Hierachy of DR
1. Negotiaiton
2. Mediation
3. Conciliation
4. Early neutral evaluation
5. Expert determination
6. Adjudication
7. Arbritration/litigation
arbitration: resolve disputes under control of the parties; conditions met e.g. idena genuine dispute, binding agreement 2 submit 2 arb in contract;
Arbitration procedures:
docs only - 30days
short hearing - 30 days
full hearing - long
Difference between Arbitration & litiation
Arbitration:
governed by Arbitration Act 1996
in order 2 arb u must have agreement from both parties
parties have a degree of discretion as to they way proccedings r conducted
similiar 2 litigation in sense of formal submission, expert evidence, hearing & decision by arbitrator
3 types:
Short hearing - 1 month
Docs only - 1 month
full procedure - long
Advantages: private; parties have flex; arb awards easier 2 enforce
Confidential/ private
Litigation:
presentation of argument in court
public process - follow Civil Proceudure Rule
Advantages: parties don't pay 4 judge/court, speedy & efficient, process can deal with multi parites, Civil Procedure rules = accessibility
good 4 multi-party disputes
Litigation: last resort 2 settle disputes by an action in court of law
Advantages:
3rd parties can join in on dispute
legal aid avaliable
less expensive than ARB
decisive approach by judge
Disadvantages:
time consuming & unclear results
Uk stat DR procedure; relitively quick from submission 2 referral; binding until dispute determined by litigation/arbritation
enforcement in contracts by HGCRA 1996
applies to all E/S/W contracts
if there r no provisions for Adj in contract = Scheme 4 construction contracts applies
its a stat right 2 have adj assuming the contract qualifies under the construction act. if not scheme 4 construction contracts applies
resolution by qual. person exp in subject under dispute. they decide the outcome
ADVANTAGES:
Rapid
binding
cheap
private
court gives support to its outcomes/ rulings
is a non binding assessment by a neutral professional. this could be used as a bias for settlement
Similar 2 mediation; independant party 2 aid agreement; conciliator = no auth 2 seek evidence of call witness; coniliator = makes NO decisions.
Difference between Mediation & conciliation:
Mediation: brings parties 2gether & agree based on careful approach which best suits both parties
conciliation: doesnt try to bring parties together and agrees through a 3rd party acting as a broker
ADR - sep 3rd pty 2 mediate & guide a decision optimising parties needs; med encourages coming 2gether and agreeing
Centre for effetive dispute resolution CEDR
can provide 2 prj mediators 4 a mth retainer 2 a prj
attend prj meetings 2 discuss progress - deal with any prb
prj mediation w.shop is arranged prior 2 contract commencement - to resolve any conflict using CEDR model mediation procedure
parties may through formal/informal process agree to settle the dipute either at high level or in detail & agree 2 b bound by this settlement
Success of negotiation: both parties come away happy, costs agreed
1 to 6 are ADR procedures
Conflict Avoidance
2 methods
management methods
reduce risk through better planning e.g. ensuring contract docs are prepared properly & r clear and precise
Project & business structures: e.g. partnering/ integrated project teams, using appropriate procurement methods; emp good value management
non escalation methods
resolving disputes b4 they escalate: e.g. structured negotiation, tired DR mechanisms in contrats
using appropriate procurement practice
sufficient preparation and tender planning
complete design in all respects
selection construction contracts e.g NEC/ECC
contract docs clear and precise
utilising project business structures which reduce risk of disputes e.g. partnering
adopt good proj & commercial man practicies
pre-contract reviews 2 avoid any issues
periodical risk reviews
tiered DR mechanisms in contrats
use of dispute board and prj mediation
project CA
client decide what he wants (time, cost, qual, early start)
decide appropriate procurement route
know the deal with MC - allowcation of risk
put in writing all agreed terms & contract docs
single pt of responsibility e.g. avoid dispute through bad comminucation
ensure the client is always aware of scope/fee inc and costs through financial reporting
What is dispute resolution?
actions 2 resolve contractural disputes
Adjudication
not legally binding
adj forms an opinion based on evidence
parties may accept decision or may agreed to take dispute to a legally binding arbitration or commence litigation
referring party: give notice to all others 2 go 4 arbitration
fee for adjudication - paid by both parties
"pay now, argue later" method adopted in Adj
Quick & cost effective
Advantages:
Independent assessment
quick decision
binding for duration of contract wrks
can b reassessed after completion of wrks
Disadvantages:
Quick decision
used as an ambushing tactic
can b reassessed after wks complete
Adjudication vs Arbitration
Arbitration :
consentual process
no time limit
legally binding
Adjudication:
right by statute
time is limited
not legally binding
Arbitration
settlement of a dispute by an Arbitrator
Arbitrator decides the case and award
judgement can b incorporated in 2 decree or court
Decision = arb knowledge, evidence, enquiries 2
Arbitration Act 1996
led to the drafting of 2 sets of rules
CIMAR (con ind model arb rules 1996)
ICE arb procedures 1997
Advantages:
cheap
Quick
suitable 4 complex tech matters
conveinient
private
commercially expedient
The Technology and Construction Court (TCC)
The 4 C's of ADR
Consensus (2 find a business solution)
Continuity (solution 4 on going business relationship
Control (ability 2 tailor a solution geared 4 a business result)
Confidentiality (avoid harmful revelations 2 the public
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