Fundamentals of Law IV – Global Homework Experts

LAWS11030 Foundations of
Business Law
Fundamentals of Law IV
Dispute Resolution
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Lecture Overview
A. Overview of Dispute Resolution
B. Litigation and the Courts
C. What is Alternative Dispute Resolution?
D. Negotiation, Mediation, Conciliation, Arbitration and the
Ombudsman

A. Overview of Dispute
Resolution

Types of Business Disputes
• Contractual disputes with customers or suppliers
– Local or international
• Disputes with competitors
– Anti-competitive conduct, intellectual property, etc
• Disputes within the business
– Between partners or owners
– With employees

Parties to a Business Dispute
• Commercial disputes may involve:
– Businesses
– Businesses and individuals
– People within a business eg. owners, employees,
management, etc
– Business and government/statutory authority

Methods of Dispute Resolution
1. Litigation
2. Negotiation
3. Mediation
4. Conciliation
5. Arbitration
6. Ombudsman services

Jurisdiction and Dispute Resolution Forums
• Jurisdiction refers to the scope or powers of the
authority of the court, tribunal or ADR forum
– Derived from legislation, procedural rules for courts and
tribunals or sometimes contract for ADR
• Jurisdiction can be:
– Original and appellate jurisdiction
– Criminal and civil jurisdiction
– Specialised: courts, tribunals, ombudsman and ADR
bodies
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Representation and Costs
• Legal representation may involve hiring a lawyer:
– Fixed fees for specific tasks are not common but ‘costs agreements’ are now
required to approximate total costs
– Itemised bills set out cost of a letter of advice, communication with opposing
lawyer, meetings, court appearance, etc
– Hourly fees vary for associates, senior associates and partners
à charged in six
minute increments called ‘units’
– Fees and cost vary between rural, suburban and commercial city based law firms
(boutique, medium and large)
à fees for court are sometimes set by civil
procedure rules
• Law firms may hire a barrister
– Specialist in litigation, specific matters and court appearances
– Cost varies on experience and whether a senior counsel/Queens’ council (silk)

Remedies
• Non-legal remedies
– Resolve the dispute without legal representation or formal dispute
resolution
– End commercial relationships with customers or suppliers
• Legal remedies
– Initiate litigation/court proceedings
– Settlement – parties resolve dispute under court guidance
– Court orders eg. damages, bankruptcy, recognition of a debt, etc
– Equitable remedies eg. injunction, order for specific performance,
etc
– Civil penalties if a statutory authority is involved eg. fines

Enforcement of Court Orders
• Parties to a dispute may not always comply with a
court order and settlement
– The affected party may need to return to court for further
remedies eg. bankruptcy proceedings
• Multiple court hearings may be required for some
legal processes
– Eg. secured debt recovery requires multiple court orders,
including evidence of a debt and order to take possession
of property

B. Litigation and the Courts
Overview of the Litigation Process
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Elements of Litigation
• A person commences civil proceedings to enforce some legal right
they believe they have against another
– Procedural rules for bringing a civil action vary according to the court
• Parties to a civil dispute:
– Plaintiff: the party commencing the action
– Defendant: the party against whom the action is brought
• Standard of proof to win a civil case is the balance of probabilities
– Contrast to the standard of proof of beyond reasonable doubt in criminal
proceedings

Overview of Court Processes
• The system of dispute resolution used in modern Australian courts is
called the adversarial system
à c/f to inquisitorial system in civil law
legal systems.
– The parties ‘fight it out’ until one of them is declared a winner by an impartial
referee in the form of a judge.
– The parties have complete responsibility for the conduct of their case within strict
rules of procedure and evidence.
• The judge observes and listens to the proceedings, ensures that all
rules of procedure and evidence are applied fairly and consistently,
allows both parties to be heard and, unless there is a jury, decides
the case
– Incorrect application of rules may result in an appeal
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Court Processes
Pleadings – parties set out the matters in dispute via statement of
claim and defence
Interrogatories – a set of questions about the facts of the case that
the other party must answer on oath.
Discovery – a party must make a statement on oath as to all the
relevant documents in their possession or control and can be
required to allow the other party to inspect and take copies of these
documents.
Trial – involves each side presenting and assessing the other side’s
evidence and witnesses
à settlements can occur before or during a
trial
Appeal – the decision of a court is subject to an appeal
The Cost and Uncertainty of Litigation
• Civil litigation is expensive and part of the
uncertainty is due to the uncertainty of the
litigation process
– Legal representation is expensive
– Prospect of settlement
– Cost and length of a trial
– Award of legal costs if lose a trial
– Risk of appeal

Litigation and Settlement
• Most matters before courts are settled before a trial eg. Western
Australia in 2015/16:
– Only 51 of 2,964 matters before the Supreme Court went to trial – 98.25%
were settled
– Only 50 of 4,948 matters before the District Court went to trial – 98.9% were
settled
– Similar results in the Magistrates’ Court but no statistics available
• Why are so many matters settled?
– Cost?
– Time?
– Strategy?
– Uncertainty?

C. What is Alternative Dispute
Resolution?

Alternative Dispute Resolution (ADR)
• ADR is dispute resolution that does not involve
litigation and courts
• ADR typically involves the resolution of the
dispute by an independent third party
• Key aims of ADR include being a quicker and
cheaper option to litigation
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Types of ADR
• Negotiation
• Mediation
• Conciliation
• Arbitration
• Ombudsman services
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Advantages of ADR
• Flexibility
– Parties can choose the type of ADR
– Can progress from one type of ADR to another if not
successful
• ADR is generally confidential and private
– Contrast to public nature of court proceedings
• Can opt to go to court at a later date
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Advantages of ADR
• Costs
– Generally cheaper than court in terms of money and time
• Independent third party
– Independent third party is frequently an expert – dispute resolution
and/or area of commerce/law
– Parties can choose the independent dispute resolver
– Proceedings are self-directed and the parties have greater choice
• Less formal than court
– Both formalities and etiquette
– Rules of evidence (what can be used as evidence) do not apply in
the same way
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Disadvantage of ADR
• A party may still need to go to court
– Eg. If the ADR is unsuccessful or a party violates the decision
• Limits on powers of independent third party
– Usually restricted to awards of money
– Typically cannot direct parties to do or not do something
• Enforcement issues
– If decision is unfair or violates a dispute resolution agreement
– There may be limitations on the ability of a court to review an
arbitrator/mediator’s ruling

D. Negotiation, Mediation,
Conciliation, Arbitration and
the Ombudsman

Negotiation
• Can be just the parties or a third party
– Very informal and cost effective
• Works well when:
– The parties have a working relationship
– Want to resolve the dispute
– Can still communicate and want to control the outcome
• Does not work well when the parties have a bad
relationship and are unlikely to cooperate
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Mediation
• Mediation can be voluntary or ordered by the courts
• Similar to negotiation but with a mediator present
– Mediator facilitates discussion to maintain fairness and respect
– Mediator does not take sides, give advice or make decisions
– The mediator’s presence makes the process more formal than
negotiation but it is still flexible
• Parties control the outcome
• Private and cost effective
• If an agreement is reached it can be recorded and
signed or taken to court for a formal order
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Conciliation
• Similar to mediation and involves an independent
third person called the conciliator
– The conciliator has a greater role than a mediator in
providing advice, information and specialist knowledge
– Does not take sides or make decisions
– Can be voluntary or by court order
• Parties still control the outcome
• Works well when parties can communicate but need
information or specialist knowledge
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Arbitration
• The arbitrator is an independent third party that hears both sides
and then makes a decision
– Simplified version of court or tribunal
– More formal and structured than other ADR
– Parties can choose the arbitrator
– Arbitrators may have special knowledge in the area
• Can be voluntary, part of dispute resolution in a contract or by court
order
• Works well when parties want a decision without going to court
• Quicker, less formal, more private and cheaper than court
• An arbitrator’s decision is called an ‘award’ and is binding like a
court order
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The Ombudsman
• Actions of an ombudsman include investigating,
making recommendations, managing ADR, some
limited decision-making
– Provides information, review and investigatory services
– Free service
– Specialises in specific industries or types of relationships
• Different types of ombudsmen
Fair Work Ombudsman
Telecommunications Industry Ombudsman
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