Resolving disputes efficiently is crucial for maintaining professional relationships and ensuring contract performance. A well-structured dispute resolution procedure can address disagreements and avoid prolonged conflict. This article outlines a typical process for managing disputes in contracts.

Negotiation: The First Step

Parties must prioritize resolving disputes through direct negotiation. Open communication is vital during this stage to exchange relevant information. Both parties should disclose necessary documents without prejudice to facilitate mutual understanding. Negotiations help address issues early and reduce the need for formal proceedings.

Mediation: A Collaborative Approach

If negotiations fail, parties can appoint a Project Mediator to assist in resolving disputes. Both parties jointly select the mediator or request a professional body to appoint one. The mediator reviews all records and facilitates good-faith discussions. Mediation is non-binding, and the cost is equally shared. This process ensures a collaborative resolution while preserving relationships.

Arbitration: The Final Resolution

When disputes remain unresolved, arbitration serves as the ultimate step. Parties refer disputes to an arbitral tribunal under applicable arbitration laws. A single arbitrator handles cases involving technical issues during ongoing work.

For broader disputes, a three-member panel ensures balanced representation. Arbitration offers a legally binding decision, providing finality to the resolution process.

Benefits of a Clear Procedure

A structured dispute resolution procedure prevents delays, reduces litigation costs, and promotes fairness. It encourages timely resolutions, preserves business relationships, and ensures adherence to contract terms.

References

• “Understanding Mediation in Disputes,” Mediation Society. www.mediationsociety.com
• “Arbitration Rules and Practices,” American Arbitration Association. www.adr.org
• “Efficient Dispute Resolution in Contracts,” FIDIC. www.fidic.org
• “Dispute Resolution Techniques,” Chartered Institute of Arbitrators. www.ciarb.org