RESEARCH ARTICLE | OCTOBER 05 2023

Barriers to construction mediation: Views of mediation

practitioners 
E. Mohd Ahnuar; Z. Ismail  ; S. S. Judi; N. M. Nasir

AIP Conf. Proc. 2881, 050008 (2023)

https://doi.org/10.1063/5.0167653

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 Barriers to Construction Mediation: Views of Mediation
Practitioners
E. Mohd Ahnuar1, b), Z. Ismail1, a), S. S. Judi2, c) and N.M. Nasir2, d)
1
Centre of Studies for Construction, College of Built Environment, Universiti Teknologi MARA, 40450, Shah Alam,
Selangor, Malaysia
2
Centre of Studies for Quantity Surveying, College of Built Environment, Universiti Teknologi MARA, 40450, Shah
Alam, Selangor, Malaysia
a)
Corresponding author: zulhabri@uitm.edu.my
b)
ezlina961@uitm.edu.my
c)
sitisuhana@uitm.edu.my
d)
nasya168@uitm.edu.my

Abstract. Mediation is generally acknowledged as one of the most effective dispute resolution methods. The main purpose
of this article was to investigate the barriers which impede the use of mediation in resolving construction industry disputes.

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Further, this article considers the ways to improve the adoption of mediation in the construction industry. Following a
comprehensive literature review, a questionnaire survey among construction mediation practitioners is carried out. From
the findings, barriers from the views of construction mediators were identified. They are lack of awareness, a perception
that other methods are more effective, non-binding nature, lack of government initiative, fear of disclosing information, no
standard of practice for mediator, and intransigence. This article provides seven ways on improving mediation. They are
adoption of mediation in government projects, mediation settlement to be enforceable, the inclusion of mediation in all
standard forms of contract, increase promotion/event regarding mediation, making mediation compulsory, education to
professionals in construction through CPD programs, and improving mediator’s quality, skills and competency. The
researcher will further gather opinions from disputants and validate the findings in near future.

INTRODUCTION

Dispute is common in the construction industry due to its complexity and involvement of various parties in every
stage of the project [1-2]. There are many ways in which the disputes may be resolved. Litigation is a formal way of
resolving a dispute, but it has been known to be time-consuming, adversarial, costly, and damaging to reputation as
well as business relationships. Alternatively, the parties in dispute can opt for a less adversarial method which includes
arbitration, adjudication and mediation, and expert determination. In Malaysia, few leading organizations provide
Standard Forms of Contract for construction works, and dispute resolution method in each contract varies. Among all
methods, mediation is one of the less utilized methods [3-4]. A survey is carried out among mediators registered
with Asian International Arbitration Centre and Malaysian Mediation Centre to determine the reason. As a part of an
ongoing Ph.D. that explores the possibility of improving the utilization of mediation in the Malaysian construction
industry, this paper highlights the barrier to employing mediation in resolving construction disputes from the
perspective of registered mediators. Briefly, the findings found that the main barrier to the lack of adoption of
mediation is a lack of awareness. This paper will also address the ways on improving the utilization of mediation.

3rd International Conference on the Built Environment and Engineering (IConBEE) 2022
AIP Conf. Proc. 2881, 050008-1–050008-6; https://doi.org/10.1063/5.0167653
Published by AIP Publishing. 978-0-7354-4682-3/$30.00

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 MEDIATION IN THE CONSTRUCTION INDUSTRY

Mediation is not a new method for the resolution of construction disputes. An impartial third party mediates the
conflict between two or more opposing parties as part of a systematic facilitative process to reach a mutually agreeable
resolution. To achieve a win-win solution, the process involved eliciting the requirements, expectations, and interests
of the parties involved in the dispute. Mediation had received contractual support from private standard forms of
construction contract such as the following

TABLE 1. Mediation in selected standard forms of contract

Standard Form of Building Contract Clause
Standard Agreement and Conditions of PAMContract 2018 (With 34
Quantities) [5]
Construction Industry Development Board’s (CIDB) Standard 47.2
Conditions of Contract forBuilding Works 2000
IEM Form of Contract for Mechanical andElectrical Engineering Works Option Module B: Mediation
Second Edition,2012
AIAC Suite of Contracts 2019 [6] 34

In these standard forms of contract, the parties must first attempt mediation before initiating arbitration.
Regrettably, there is a lacking of contractual support from the government as the PWD from of contract did not
specify mediation in any of its clauses [7-8]. This can be a result of an organisational problem when the party
representative in government doesn't have the power to decide [9]. Thus, incorporation of mediation in public work
contracts is highly necessary.
Despite all that, the adoption of Mediation is still very low. Table 1 shows the number of cases brought to the
Asian International Arbitration Centre (AIAC) from 2019-2021.

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TABLE 2: Number of disputes brought to AIAC (Source: [10])
Alternative Dispute Resolution 2019 2020 2021
Arbitration 125 100 117
Adjudication 816 537 657
Mediation 3 4 8

ADVANTAGES AND DISADVANTAGES OF MEDIATION

Mediation has been recognized for its benefit; [11] listed 6 characteristics of its benefits which are being
supported by many researchers. They are: consensual [12], control [12], cost saving [12-15], continuing business
relationships [12], [14], [16], confidentiality [12], [16] and creative solution [12]. Several studies had shown high
level of user satisfaction with mediation [12], [17].
It is also worth noting some of the disadvantages of mediation that should be addressed. There are instances where
lawyers used litigation skills in mediation that resulted in a process akin to arbitration and thus, adversarial [16].
There is also a perception that mediation is not “real law” and the parties may use mediation to get information
from theother party to be then used in litigation [13].
Whilst all the benefits are not universally applicable to all disputes in the construction and there are some
drawbacks, there is a potential for mediation to be made one of the main methods of resolving disputes. Consequently,
it is important to encourage and promote the use of mediation in settling construction disputes. To efficiently promote
mediation in the construction industry, it is pertinent for all the barriers that hinder the adoption of mediation to be
identified and thus, steps to overcome them can be implemented.

RESEARCH METHOD

A questionnaire survey with a five-point Likert-type scaled range was used in this study to collect data. The
respondents were mediators registered with the Asian International Arbitration Centre (AIAC) and Malaysian
Mediation Centre (MMC) under the specialization of construction/ engineering/ infrastructure/ architecture &
design/ Quantity Surveying. 125 questionnaires were sent to the mediator's email address. A total of 34 responses

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were received, with 8 respondents unable to respond due to a lack of practical mediation experience and other
commitments. This brings to a 27.2% response rate. The data collection response rate is deemed acceptable because
the normal response rate in the construction research environment is between 20 and 30 percent [18].
The participants' experience (Table 4) suggests that the majority of the participants have strong knowledge of
construction mediation issues, as 12 respondents (46.15 percent) have more than ten years of experience mediating
construction disputes.

TABLE 3: Response rate

Respondents Sent Return Percentage (%)
Construction Mediators 125 34 27.2

TABLE 4: Respondents’ experiences

Years of experience 0-2 <5 5-10 10-15 15-20
Construction Mediator 2 11 1 5 7
Percent 7.70 42.31 3.85 19.23 26.92

FINDINGS AND ANALYSIS

Barriers to construction mediation

Previous research indicates that construction disputants have a limited understanding of mediation. They appeared
to be unaware of the appropriateness and benefits of using mediation [3], [19-22]. Amiruddin in his research found
that “100% of the participants agreed that the main factor causing a barrier to use and acceptance of mediation was

06 October 2023 04:15:41

the lack of awareness of the public” This is supported by other researchers that also found the low adoption is due to
lack of awareness on mediation [3], [21-23]. In this study, the mediators responded that unfamiliarity, lack of
knowledge and awareness are the most significant barriers that hinder the uptake of mediation. Table 3 shows
that majority of respondents agreed that lack of knowledge and awareness are the main barrier for low
adoption of mediation in the construction industry. With a mean score of 3.69, mediation is also perceived
to be less effective than other methods of resolving dispute such as adjudication [9], [14] and negotiation
[9], [10].
Despite the establishment of the Mediation Act 2012 [24], contractual support from private standard forms of
contract, and active encouragement by the court through Practice Direction No 4 of 2016, mediation adoption is being
reserved due to its non- binding nature. Some disputants prefer a binding decision, even if it means an unfavorable
outcome for them [25]. The willingness and consent of the parties to participate in mediation are critical [26].
There is initiative by the government to welcome mediation as viable method of solving disputes by establishing
Pusat Mediasi Covid-19 (PMC-19) under the purview of Temporary Measures for Reducing the Impact of Coronavirus
Disease 2019 Act 2020 (Covid Act 2020) [15]. As of 10 November 2021, 14 construction disputes were registered, 4
of which had been resolved and 2 disputes were still in mediation process. Out of the nine types of contractual
dispute, construction dispute makes 9% from total mediation dispute brought to PMC-19 [27]. However, despite the
initiative, as stated in the previous sections, the absence of a mediation clause in the Public Works Department 203A
contract may be misinterpreted as a lack of government support for mediation [7]. The findings from the
questionnaire survey showsthat the lack of initiative had an impact towards low adoption of mediation.
The concern on disclosing information that will be used in court should mediation process failed is another barrier
to adoption of mediation [19], [23]. It was found to be among the barriers the respondents rank as quite significant
(mean score: 2.92). If mediation fails, a substantial portion of a party's defense may have been exposed to the
opposing party,making it significantly less useful in a future trial [28].
There is also concern about competency due to the absence of a standard of practice for mediators [23], [29]. The
mediator was found to lack competence, impartiality, and accountability. This resulted in a simple, straightforward,
and commonly used solution to divide the difference into equal halves [25], [30].

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 TABLE 5: Barriers to adoption of construction mediation
Barriers Reference Mean Std Deviation
Unfamiliarity/lack of knowledge/ awareness. [11-15] 3.92 1.29
Perceived as less effective as compared toother ADR. [12], [14-16] 3.69 1.12
Non-binding nature/ Absence of enforcementregime. [18] 3.42 1.53
Lack of governmental initiative. [1] 3.27 1.46
Fear of disclosing information that will be usedin court if no resolution achieved. [13-15] 2.92 1.16
There is no standard of practice for mediatorsin Malaysia. [17-18] 2.50 1.14
The need to win/intransigence [21] 2.15 1.32

The responses showed that the utmost barrier to adoption of construction mediation from the point of view of
mediator is the lack of knowledge or awareness among the construction practitioners over the advantages of
mediation. In addition, mediation is perceived to be less effective as compared to other ADR. This misunderstanding
may be stemmed from the lack of knowledge among the construction practitioners. Mediation is maybe not desirable
among disputants due to the lack of enforcement regime; this is shown by the results of questionnaire (Mean 3.42).
The questionnaire included an open-ended question for any other barriers that were not mentioned. One of the
responses was mistrust. The lack of trust may be due to distrust in someone who is not from a judicial body [21].
One of the respondents claimed that the attitude of lawyers who advise their clients against mediation is another
barrier. Lawyers have also been identified as the reason for the low utilisation of mediation services and the low
level of interest in mediation [31]. One of the respondents stated that “The lawyers need to be educated on mediation
advocacy where they will advise their clients properly on the use of mediation. The clients' lack of
understanding of the mediation process stems from the lawyers in failing to provide proper strategic advice.”.
“Lack of genuine intent to settle” is also mentioned in the response. One of the respondents wrote “defendant making
use of legal procedures to prolong to process instead of having a speedy process” and another mentioned “barking
up the wrong tree instead of seeking solution quickly and timely”. In some cases, the parties enter mediation solely to
fulfil procedural requirementsprior to arbitration, rather than with the intention of seeking solutions.

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Improving adoption of construction mediation

TABLE 6: Improving adoption of mediation

Ways to improve Reference Mean Std Deviation
Adoption of mediation in public project [21] 4.62 0.70
Mediation settlement to be enforceable (final &binding) [13], [32] 4.12 1.42
Inclusion of mediation clause in Standard andBespoke Standard Forms of Contract [15], [32] 4.12 1.21
Increase encouragement/promotion and eventsto promote Mediation [32-33] 4.00 1.13
Make mediation compulsory [33-34] 3.96 1.56
Education among construction practitionersduring CPD programme [32] 3.92 1.20

The respondents mostly agree that the adoption of mediation in public projects will improve the overall adoption
of mediation in the construction industry. The trust of the government in the process may give confidence to
construction players in adopting mediation to resolve disputes [21]. The respondents also agreed that mediation settlement
should be enforceable. The entire process would be pointless if the finality could be contested and the parties ultimately
decided to file a lawsuit in court [13]. Inclusion of mediation clause in standard and bespoke forms of contract is
another way of ensuring adoption of mediation. However, it should be highlighted that the clause must be respected
in a waythat requires the parties to attempt mediation before resorting to arbitration or litigation [15].
Further, the respondents agreed that there should be more promotion and events to promote mediation among
the public. [15] emphasized that the court should encourage mediation by requiring it before bringing a lawsuit. In the
open-ended section of this part of questionnaire, the respondents suggested that “It should be court or other
authority sanctioned with costs or other penalties for non-participation”. Surely, this will require some legislative
changes. It is also important for construction practitioners to understand mediation and what it entails. Thus,
incorporation of knowledge and awareness during CPD programme will help to promote mediation. One of the
respondents stated thata cultural shift from a disputatious culture in the legal profession is needed.
Since there is a concern about mediators’ competence and thus causing distrust, it is important to make sure that
the construction mediator is competent enough and there should be a way to make sure that mediators are equipped
with sufficient knowledge and skills.

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 CONCLUSION

In summary, mediation has a huge potential as the main dispute resolution option for construction practitioners.
The benefit of time, cost, reputation, and confidentiality are among the best ADR methods to reach an amicable
solution. However, the adoption of mediation is very low. The results demonstrated that the main barrier to the use of
mediation is a lack of awareness. Despite the fact that mediation has been around for many years, there are still some
construction practitioners who are unsure, misinformed, or perhaps have no idea what mediation is or how it works.
Additionally, several suggestions for improving the use of mediation were offered in this paper. Government projects
must incorporate mediation, according to the construction mediators. The suggestions are followed by the enforcement
of the solution and the inclusion of mediation in all construction contract forms. Mediation is not a recent breakthrough
in ADR and thus, the untapped potential must be fully recognized and promoted for greater use in the construction
industry.

ACKNOWLEDGEMENTS

The authors would like to thank Neksus Penyelidikan Uitm (Reneu), Pejabat Timbalan Naib Canselor under
Penerbitan Yuran Prosiding Berindeks (PYPB)for supporting this publication.

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