Scottish construction lawyers and mediation: an investigation into attitudes and experiences

AuthorAndrew Agapiou
PositionUniversity of Strathclyde, Glasgow, UK
1 Introduction

The construction industry is inherently litigious and the relationship between parties involved in construction projects may often be adversarial in nature. Even under partnering conditions, if the contract is complex, the possibility of disputes arising is likely ( Lowsely and Linnet, 2006 ). While more traditional modes of resolving disputes such as litigation, pre-trial negotiations and arbitration may be deployed in the Scottish construction sphere, the adversarial nature of such processes may hold deleterious consequences for parties in terms of financial costs, delays, risks and ensuing loss of business. The creation of the Scheme for Construction Contracts and the enactment of the Housing Grants Construction and Regeneration Act 1996 led to the development across the UK of the adjudication process first proposed in the Latham (1994) report. Although heralded as a quick, efficient means of resolving construction disputes, concerns regarding adjudication have long been expressed ( Macauly, 1999 ) and the process has endured a chequered reputation of late, both in terms of the costs for parties involved and the quality of decision making rendered ( Uff, 2005 ).

Judicial opinion in cases such as Macob Civil Engineering Ltd v. Morrison Construction Ltd1 would seem to suggest that at times the adjudication process has spawned into a creature much more expensive and confrontational in nature than originally intended by parliament. Scepticism as to the suitability of the process for more complex construction disputes was also expressed by HHJ Coulson QC in William Verry (Glazing Systems) Ltd v. Furlong Homes Ltd2. In summing up the case, the judge stated:

Whilst such adjudications are not expressly prohibited by the Housing Grants, Construction and Regeneration Act 1996 as it presently stands, there is little doubt that composite and complex disputes such as this cannot be accommodated within the summary procedure of adjudication3.

Complex disputes can involve delays, disruption, extensions of time, technical determinations, debate over facts and detailed examination of contractual terms and underlying legal norms. In these circumstances, it may be difficult to see how the adjudicator is expected to arrive at a legitimate decision within the statutory 28-day period based solely on the documentary submission provided, and any other evidence that is available, such as physical evidence on site.

1. 1 The emergence of mediation

As Alexander (2006, p. 1) has recently noted, “[m]ediation is a process which is both new in terms of its emergence in the legal arena and old in terms of its timeless universality”. Forms of mediation have been present historically for centuries ( Roebuck, 2007 ). For instance, mediatory forms of dispute resolution were practised in pre-capitalist, tribal societies, in ancient Greek cultures, as well as in mediaeval England ( Abel, 1983 ; Levinson, 1994 ). More modern times, however, have been characterised by what can be termed a “re-institutionalisation” of mediation as part of a wider “alternative dispute resolution (ADR)” movement. The modern ADR movement can be largely traced back to its emergence in the 1970s, USA deriving primarily from the National Conference on the Causes of Popular Dissatisfaction with Administration of Justice (the “Pound Conference”) in Minnesota in 1976 in which Professor Frank Sander is credited with first coining the phrase, “alternative dispute resolution” ( Sander, 1979 )4.

Writing extolling the virtues of mediation is rife. Proponents in Scotland have argued that mediation is a cheaper, quicker and with its emphasis on consensus and party self-determination, altogether more harmonious method of dispute resolution than traditional, adversarial methods ( Sturrock, 2007 ; Malcolm, 2008 ). While mediation has long been described as a dam waiting to burst, the rivers of enthusiasm are still not flowing in Scotland. The process has stood on the cusp of mainstream civil disputing for the better part of two decades ( Clark, 2008 ). Interest and practice continues to grow, however. Mediation pilot programmes have been commissioned in the Sheriff Courts of Edinburgh, Glasgow and Aberdeen, with largely positive evaluations ( Samuel, 2002 ; Ross and Bain, 2010 ). A number of commercial mediation providers have entered the fray, such as Core Mediation and Catalyst Mediation. Mediation in matrimonial disputes is well embedded and community mediation services have taken root across the country ( Brown et al., 2003 ; Lewis, 1999 ). Workplace and employment mediation has also become a common tool in the resolution of disputes in the labour field ( Malcolm and O'Donnell, 2009 ). Over recent years, lawyers have shown an increasing interest in the process generally, forming mediation organisations, undertaking training as both mediators and party representatives in mediation and offering mediation services directly through their litigation departments ( Clark, 2009 ).

Despite some empirical evidence of modest growth in the use of mediation within Scottish civil and commercial disputes generally ( Clark and Dawson, 2007 ; Sturrock, 2007 ), and evidence of the growing use of construction mediation in other jurisdictions such as England and Wales ( Gould et al., 1999 ), the USA ( Thomson, 2001 ) and Hong Kong ( Cheung, 2010 ), little evidence can be gleaned from the literature regarding construction mediation activity in Scotland. Again, despite the fact that empirical evidence exists regarding the lawyer's role in, and experiences of mediation in general civil disputes in Scotland ( Clark and Dawson, 2007 ), and construction matters in other jurisdictions such as England and Wales ( Brooker, 2002 ; Brooker and Lavers, 2005 ), little is known about construction lawyers' interaction with the process in Scotland. Given the “gatekeeper” role that lawyers play in respect of different forms of dispute resolution, they may be crucial in helping expedite the development of any innovations in the field ( Wissler, 2004 ; Lande, 2000 ).

1. 2 Scottish civil justice

The current study is also particularly timely because it takes place against a backdrop of a Scottish civil justice system in flux. Currently, the twin notions of improving access to justice and developing Scotland as an international center of excellence in dispute resolution have exercised the minds of policy makers, academics and interest groups ( BELF Report, 2008 ; Civil Justice Advisory Group, 2002 ; Gill, 2009 ). The Scottish civil justice system is quite separate and distinct from that operating south of the border. Unlike its English counterpart, it has not been the subject of recent wholesale restructuring and reform. Nonetheless, the Scottish civil court system seems primed to experience quite fundamental changes in the aftermath of the recent Gill review on civil justice ( Gill, 2009 ). Concurrently, a new Arbitration Act has recently been passed by the Scottish Parliament, radically reforming the incumbent largely, common-law-based system; the intention of which is to create a modern, efficient framework for arbitration and thus position Scotland as an attractive center for international dispute resolution5.

Against this backdrop then, the aim of the research is to explore the utility of mediation in the construction industry in Scotland. The objective was to elicit views, practices and experience of mediation techniques rather than an in depth account of a limited number of randomly chosen case studies. A questionnaire approach was used for this initial stage of the enquiry.

2 Method
2. 1 Primary data collection and analysis

Having defined the framework for the opinion survey, the next step was to develop the necessary data collection tools in accordance with the research objectives. A postal questionnaire was distributed to 165 legal professionals ascertained from the membership lists of professional associations for solicitors, advocates and mediators based and operating in Scotland, as well as searching firm web sites for contentious construction specialists. We attempted to track all contentious construction lawyers in Scotland, although given the lack of a definitive list of such individuals we cannot state with certainty the exact size of the population.

The questionnaire was divided into three sections as described below:

  • Section one: the use of mediation in construction disputes. A number of variables from the survey were selected from the questionnaires as the basis for assessing the use of mediation in construction disputes including the background and experience of the respondents in the legal profession, their training in mediation and organisational policies and practices towards mediation.
  • Section two: experience of the use of mediation. In terms of experiences of mediation, respondents were asked to rate their...
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