Republic of the Philippines

POLYTECHNIC UNIVERSITY
OF THE PHILIPPINES
College of Architecture,
Design, and the Built Environment
NDC Compound, Sta. Mesa, Manila

FACULTY MARKED ASSIGNMENT NO.10

AWAY SA CONSTRUCTION PAANO MAIIWASAN
CONSTRUCTION DISPUTE RESOLUTION STRATEGIES

A.) PARTNERING

According to William H. Choquette, author of The Use of Partnering in the

Facilities Design Process: Summary of a Symposium; Partnering is a project
approach intended for the design and construction process to be performed in such
way mutual trust, commitment to shared goals, and open communication among the
client and project and construction professionals (ie. Architect, Engineer, Contractor
etc.) are kept established through a “win-win” goals and objectives.

Advantages
According to the The Use of Partnering in the Facilities Design Process, the
following advantages of Partnering are the following…
For the owner
 Greater control of schedule and cost through close communication and
regular evaluation of project progress.
 Higher quality through focusing on mutual goals by team members who are
not sidetracked into adversarial relationships.
 The potential for a totally claim free project which can be achieved through
partnering.
 Greater innovation through open communication and trust particularly in the
area of value engineering and constructability reviews.
 Higher profit potential for all participants resulting in a more efficient project
delivery process.
For the construction manager and general contractor
 Reduced risk of delays and cost overruns by early and active involvement in
issue resolution.
 Increased productivity by the elimination of adversarial relationships and case
building.
 Greater profit potential.
For consultants
 Greatly reduced exposure to liability for document deficiencies through early
review.
 Cooperative effort to resolve problems early to reduce exposure to claims and
litigation resulting in reduced administrative costs and increased profit
potential.

For subcontractors and suppliers

 Improved cash flow due to elimination of, or reduction in, disputes resulting in
withheld payments.
 Reduced exposure to, or elimination of, claims and litigation through early
project dispute resolution.

Disadvantages
However, ehow,co,uk discussed its disadvantages from its article wrote by Corr
S. Pondent which are the following…

 Keeping track the progress will take up more time and effort considering that
there are many parties involved in a partnering approach.
 Partnering is not always guarantee a success especially if there is any
misunderstanding among the parties about their roles.
 There will risk of the involved parties to become too dependent to each other
and not find other partners to work with.
 Possible that the parties will not commit an equal amount of time and effort to
a project.

Reference:
1. The use of partnering in the FACILITIES design process. (1994).
https://doi.org/10.17226/9227

2. Pondent, C.S., 2020. The disadvantages of partnering in construction. eHow UK.

Available at: https://www.ehow.co.uk/info_8459709_disadvantages-partnering-
construction.html [Accessed September 4, 2021]
B.) VOLUNTARY ARBITRATION

Voluntary arbitration implies that the two contending parties, unable to

compromise their differences by themselves agree to submit the dispute to an
impartial authority, whose decisions they are ready to accept (Marsey, 2007).

Advantages
According to San Jose Corporate Lawyers, the following are the advantages and
disadvantages of voluntary arbitration.
 Efficient and Flexible: Quicker Resolution, Easier to schedule.
The dispute will normally be resolved much sooner. It may take several years
to procure a court trial date, while an arbitration date can usually be obtained
within a few months
 Less Complicated: Simplified rules of evidence and procedure
Litigation inevitably leads down a long path of filing papers and motions, and
attending court processes such as motion hearings.
 Privacy: Keep it out of the public eye
Unlike a trial, arbitration leads to a private resolution, so the information
brought up in the dispute and resolution can be kept confidential.
 Impartiality: Choosing the “judge”
The parties to the dispute usually pick the arbitrator together, so the arbitrator
will be someone that both sides have confidence will be impartial and
unbiased.
 Usually less expensive
Most of the time, but not always the case, arbitration is a lot less expensive
than litigation.

Disadvantages
 Questionable Fairness
 Finality: No appeals
While this may be a positive if you find the arbitration decision favorable, if
one party feels the decision is erroneous, there is very limited opportunity to
correct it.
 Can be more expensive
There are many cases in which arbitration can become more expensive than
court proceedings. Quality arbitrators can demand substantial fees that would
not apply in court.
 Unpredictability: Unconventional outcomes

Reference:
1. Gwisai. M. (2007),Labour and Employment law in Zimbabwe: Relations of work
under neo-colonial capitalism. Zimbabwe Labour Centre and Institute of
Commercial Law, University of Zimbabwe, Harare, Zimbabwe.
2. F., C., The advantages and disadvantages of arbitration. San Jose Corporate
Lawyers. Available at: https://www.sacattorneys.com/the-advantages-and-
disadvantages-of-arbitration.html [Accessed September 4, 2021].
C.) MEDIATION

Mediation is a voluntary collaborative process where individuals who have a

conflict with one another identify issues, develop options, consider alternatives, and
develop a consensual agreement. Trained mediators facilitate open communication
to resolve differences in a non-adversarial, confidential manner.

Advantages
According to AllLaw, the advantage to mediation is that, since both parties
participate in resolving the dispute, they are more likely to carry out the settlement
agreed upon (Nolo, 2020). Just like arbitration, mediation also shares similar
advantages such as the following as discuss in Mediation: A Guide to Conflict
Resolution by U.Tulane…
 Efficient: Sessions are usually held within two weeks at a convenient time.
 Effective: Issues causing the conflict are identified and addressed.
 Confidential: The content of the mediation is private, known only to participants.
 Empowering: The ultimate authority belongs to the participants themselves.

Disadvantages
According to AllLaw, a disadvantage to mediation is that the parties may not be
able to come together on an agreement and will end up in court anyway.
Furthermore since these alternative procedures are not bound to follow legal
precedent in coming to a decision, parties cannot count on legal precedent to be
determinative of the result (Nolo, 2020).

Reference:
1. Anon, Defining mediation. Available at: https://www.gdrc.org/u-gov/mediation-
define.html [Accessed September 4, 2021]. F., C., The advantages and
disadvantages of arbitration.
2. Nolo, 2020. What are mediation and Arbitration? www.alllaw.com. Available at:
https://www.alllaw.com/articles/legal/article9.asp [Accessed September 4, 2021].
D.) MINITRIAL
According to Legal Information Institute, Minitrial is a private, voluntary events
attended by representatives from each side who have authority to settle. Neutral
third parties may also act as judges or jurors.

Advantages
Mini-trial has several advantages such as discuss by CEDIRES. These
advantages are the following…
 The expedited procedure is less costly and lengthy than litigation;
 The procedure causes less disruption of business between the parties, which is
advantageous if the parties have a business relationship that they wish to
continue;
 Resolution of the dispute is in the hands of parties;
 The hearing allows each party to hear the other’s position and to consider the
relative strengths and weaknesses of each side;
 The degree of preparation required for mini-trial will be very useful for
subsequent processes, such as trial, should the mini-trial fail to succeed.

Disadvantages
CEDIRES also discussed the possible disadvantages of the mini-trial which as
the following…

 The effort and expense of the mini-trial may be wasted if the parties could have
resolved the conflict through direct negotiations or mediation;
 If unsuccessful, time spent at the mini-trial will have delayed resolution that can
be reached through adjudicative proceeding such as arbitration or trial (except if
the procedure continues like an arbitration in case of a deadlock or impasse);
 The trial-like nature of the preparation and hearing may continue to polarize the
positions of the parties rather than promote an atmosphere of cooperation from
the outset.

Reference:
1. Anon, Minitrial. Legal Information Institute. Available at:
https://www.law.cornell.edu/wex/minitrial [Accessed September 4, 2021]. Nolo,
2020.
2. Anon, Mini-trial. CEDIRES. Available at: https://cedires.com/mini-trial/ [Accessed
September 4, 2021].
E.) BINDING ARBITRATION

Shawn Grimsley from study.com defines Binding Arbitration as means of

resolving a dispute outside of a courtroom in which the decision is binding upon the
disputing parties. In other words, except under very limited circumstances, decisions
made in binding arbitration by the arbitrator - including awards of damages - must be
honored and cannot be appealed to a court of law.

Advantages
Binding arbitration shares similar advantages to voluntary arbitration in addition
to following discussed by San Jose Corporate Lawyers…

 Finality: The end of the dispute

For binding arbitration, there are limited opportunities for appeal. That gives
finality to the arbitration that is not often available with a trial decision, which may
be subject to appeals, new trials and further appeals.

However this also results to disadvantages such as the following…

Disadvantages
 Finality: No appeals
While this may be a positive if you find the arbitration decision favorable, you
should be aware that if arbitration is binding, both sides give up their right to an
appeal. If one party feels the decision is erroneous, there is very limited
opportunity to correct it.

Reference:
1. Grimsley, S., What Is Binding Arbitration? – Definition. Study.com | Take Online
Courses. Earn College Credit. Research Schools, Degrees & Careers.
https://study.com/academy/lesson/what-is-binding-arbitration-definition-example-
quiz.html [Accessed September 4, 2021].
2. F., C., The advantages and disadvantages of arbitration. San Jose Corporate
Lawyers. Available at: https://www.sacattorneys.com/the-advantages-and-
disadvantages-of-arbitration.html [Accessed September 4, 2021].
F.) LITIGATION

Burlington Legal defines litigation as the process of taking a dispute to a court of

law. If parties cannot agree between themselves about the fair and proper outcome
of a dispute they will present their respective cases to a court for its judgment. It is a
broad term that describes a long and sometimes complex process.

Ravneet A. from Pacific Advisors discussed both advantages and disadvantages

of litigation process in resolving disputes such as the following…

Advantages
 Parties are compelled to comply with judgments
Due to the nature of the judicial system, judgments obtained through litigation
compel parties to comply or they run the risk of being given certain penalties.
These penalties can include the seizure and sale of property, garnishment of the
monies owed or even possible jail time.

 Right to appeal
It allows either party to a lawsuit to ask an appellate court for a review of the trial
court’s decision should one of the parties disagree with it.

 Precedent setting
It requires judges to follow the previous rulings of higher courts in their province
and the Supreme Court of Canada on the same issue.

 Discovery
Starting the litigation process will allow you to obtain information from the other
side in the form of documents and verbal responses through processes called
document discovery and examinations for discovery.

 Potential for a predictable outcome

Taking a case to trial may yield a predictable outcome if there have been similar
precedent-setting cases decided or if there is clear legislation that dictates the
outcome.
Disadvantages
 Longer time frame
Sometimes, depending on the complexity of the issues, cases can take up to
several years to be decided by court.

 Judgment subject to appeal

Although the right to appeal was mentioned as a pro of litigation, it can also be a
con. There is always the possibility that the decision in a case may be overturned
by an appellate court, thus forcing the process to be redone all over again.

 Costly
The litigation process can undoubtedly become quite costly with legal fees and
other costs associated with going to trial.

 Damaging relationship
One of the downsides of taking a case to trial is that it is almost always damaging
to the relationship between the two parties.

 Public forum
A risk of taking a case to trial is the possibility that it will attract public attention as
most court documents are available publicly.

Reference:
1. Anon, 2021. What is litigation & its advantages & disadvantages? Burlingtons
Legal. Available at: https://burlingtonslegal.com/news/what-is-litigation-all-you-
need-to-know-about-the-law-process/ [Accessed September 4, 2021].
2. Ravneet, A., 2019. The pros and cons of litigation. Pacific Advisors. Available at:
https://pacificadvisors.ca/the-pros-and-cons-of-litigation/ [Accessed September 4,
2021].