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Construction clients and mediation: a follow-up study of attitudes and experience

Agapiou, Andrew and Clark, Bryan (2012) Construction clients and mediation: a follow-up study of attitudes and experience. [Report]

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Abstract

Construction disputes by their very nature are often complex, sometimes multi-party disputes, many of which are not suited to either adjudication or traditional forms of dispute resolution (these being potentially slow, expensive and divisive). The sheer complexity of construction disputes often leading to expensive, time-consuming and stressful paths being trodden through the traditional resolution terrain, creates a compelling case for the introduction of alternative approaches within this adversarial industry. The construction industry has become increasingly aware of the substantial legal costs it burdens itself with as a consequence of its high incidence of disputes. Moreover, this expenditure, which globally represents a substantial sum each year, is by no means reflective of the hidden costs of disputes, such as the damage to reputations and commercial relationships; cost of time spent by executive personnel; and cost of lost business opportunities. Over recent years, the Scottish Government and key players in Scottish commerce have emerged as advocates of mediation as a first choice method of settling disputes. The value of mediation has also been widely acknowledged worldwide, as evidenced by the number of jurisdictions in which the courts enforce obligations on parties to negotiate and adopt mediation to settle construction disputes. In most contexts, voluntary uptake of the process is low, however, and research into prospective client perceptions is particularly valuable. The principal aim then of this study was to explore construction participants’ [construction clients hereafter] awareness, attitudes and experiences relative to mediation, drawing upon quantitative and qualitative analyses of small and medium-sized contracting firms in Scotland. This was reflected in the main objectives of this research which were to evaluate the effectiveness of prevailing construction dispute resolution methods in Scotland; establish baseline information about the current extent of construction mediation activity in Scotland, determine the willingness of Scottish construction clients to shift away from traditional approaches to dispute resolution to mediation; and if they are, to ascertain the drivers towards the adoption of mediatory techniques, and if not the barriers to change.