Alternatives to Court Proceedings / Arbitration

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Issue

Litigation either through the courts or by arbitration can be expensive, time-consuming and divert management resources.  Parties should therefore explore opportunities for early resolution of the dispute including the use of mediation.  This guide explores alternative options that exist if settlement cannot be achieved.

Solutions

  • Service of Statutory Demand [see linked guide].
  • Ombudsman

Independent referee who will investigate complaints against public and private organisations.

  • Free service and only need seek legal advice if so elect and therefore cost effective.
  • Not bound by decision unless elect to accept outcome and so can pursue through the courts if adequate redress not obtained.
  • To pursue a claim you need to be an individual or company with turnover/net asset value of no more than £1million.
  • Compensation up to £150,000.
  • 6 months to instigate claim from the time complaint procedure of organisation exhausted.
  • Determination within no more than 6 months.
  • Ombudsman in fields of insurance, banking and finance, law, pensions and others.

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Adjudication

  • Most common in construction contract disputes.
  • Determination within 3 months’ period with strict procedural deadlines.
  • Can be used in non-construction disputes, if made term of the contract or subsequent agreement.
  • Binding and enforceable, unless resort to litigation to challenge or parties agree otherwise.
  • Adjudicator’s decision enforceable by expedited application to the courts.
  • No liability for other party’s costs and own costs reduced by speed of determination.
  • Determined on paper so no examination of witnesses or disclosure of documents.
  • Bodies like CEDR offer commercial adjudication process.

Expert Determination

  • Expert determination appropriate where issue of law or construction of contract and no disputed issues of fact.
  • Terms of instruction can be agreed between parties.
  • Swift and cost effective resolution of dispute and enable parties to maintain confidentiality.

Neutral Evaluation

  • Not intended to be binding but provides parties with early indication of likely outcome.
  • Assist prospects of settlement.
  • Proceed with claim if no resolution.
  • Can be in addition or alternative to mediation.
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