Construction: The Benefits of ADR

Litigating a construction dispute is extremely costly and time-consuming for the parties, not to mention the inevitable delays caused to the project itself. But it can be reassured that litigation is not inevitable – the parties in dispute are, in most cases, reasonable in wanting to avoid court if possible. The award-winning dispute resolution lawyers at ParrisWhittaker are highly experienced in supporting businesses in Jamaica to resolve their disagreements through alternative dispute resolution (ADR).

ADR has proved a game-changer for the business community in recent years, providing the tools for the parties to work towards settling the dispute outside of the court room. The importance of ADR is even more important given the backlog of construction cases in the Jamaica court system, due in part to the covid-19 pandemic.

There is a ‘trinity’ of ADR models: mediation, arbitration and adjudication.

Mediation

Mediation is one of the best-known forms of ADR for the fast and effective resolution of commercial disputes, both in Jamaica and the surrounding region and internationally. A neutral third party (the mediator) is appointed by both parties in what is a private process. They are usually experienced construction professionals who fully understand the issues and are well-equipped to sit down with the parties and help them to focus on and understand the issues in dispute.

The aim is that the parties can then negotiate a settlement with the mediator’s help. Importantly, the mediator makes no decisions – it is for the parties themselves to find a mutually acceptable solution. Mediation can also run alongside ongoing litigation, so even if court proceedings have begun – mediation may still be an option for you.

It’s worth noting that the Jamaica International Arbitration Centre has published its own set of Mediation Rules to help the parties to work together to negotiate a settlement that is in all their interests.

Arbitration

Also a private process, arbitration is a form of dispute resolution that should be opted into by the parties for it to be used. Either a single arbitrator or a panel of arbitrators can be appointed, depending on the nature of the dispute. A preliminary meeting between the parties and the arbitrator/s is held and the parties are informed how the arbitration will be conducted and, for example, the experts to be appointed.

The parties submit their documents; the arbitrator considers the evidence; and the arbitrator then makes their  final ‘award’ (usually in writing). In an arbitration, this award is final and, importantly, legally binding.

Adjudication

Increasingly the preferred option for those in the construction and building industries, adjudication involves an adjudicator – a neutral third party – who hears the dispute and makes a ruling.  The adjudicator is usually chosen by the parties and will be an expert in the subject matter in dispute.

The adjudicator’s decision is binding on the parties – but with the proviso that it could be changed in a subsequent arbitration or court ruling.

Adjudication is relatively beneficial because it is a quick process and the adjudicator’s decision is usually accepted – enabling the parties to move on. Standard form construction contracts often provide for adjudication as the ADR of choice.

Key takeaway

There is a growing recognition by lawyers and those in the construction and building industry in the Caribbean region of the merits of ADR, and for good reason: it is cost-effective, far quicker than litigation – and good for business relationships.

In the event of a construction dispute, our specialist lawyers will support you in utilising ADR  effectively, enabling contentious issues to be resolved quickly and your building project to continue smoothly. For expert advice, get in touch with the experienced commercial lawyers at ParrisWhittaker on +1-242-352-6112