Steps towards resolving a dispute

·                    Does the dispute arise out of a contract or other agreement?  If so, then that agreement should have provisions for dispute resolution that must be followed.  If those provisions include for procedures to appoint someone to issue a formal decision, or to arbitrate, adjudicate or mediate, then follow those procedures.  If you think that you might be better positioned by going through the Courts instead of using the dispute resolution procedures in the contract, then that may not be possible unless the other party agrees to that variation to the contract.

·                    Is the contract or agreement “informal”?  If the drawings and/or specifications and/or contract terms are not clear, then it becomes more difficult to sort things out.  It is likely that you will need an someone with both a legal and technical experience (most likely an architect or engineer, or possibly a quantity surveyor) to sort it out. However, the Construction Contracts Act sets out minimum mandatory conditions of contract.

·                    Is it a construction contract?  The provisions of the Construction Contracts Act apply to all NZ construction contracts, and cannot be contracted out of.  The Act has provisions for the resolution of disputes, which are described elsewhere on this website.  Note however, that if a particular construction contract does have dispute resolution provisions, you can also follow the adjudication procedures in the Construction Contracts Act, instead of, or in parallel with them.

·                    Seek expert advice – early:  I often see disputes which have festered to the point that resolution becomes unnecessarily difficult.  It is far cheaper to get the right advice at the outset, and then to communicate your concerns to the other party in a factual way.  Sometimes just finding out “where the other side is at”, and discussing how their actions impact on you in ways which they may not have appreciated, is enough to deal with the issue.  Regrettably, dispute resolution is too-often seen as the end of the line after much expense in preparation;  whereas an early intervention by an expert or mediator may have avoided an impending dispute altogether. 

·                    Serve notice of a dispute:  That will normally be a requirement under the contract:  if so, follow the provisions carefully.  If not, then it is obviously sensible anyway!  A dispute about whether there is a dispute, is, of course, a dispute!

·                    Are you a builder?  If you are in dispute over non-payment of an invoice, then the provisions of the Construction Contracts Act require you to have served your Payment Claim in a specific way – or at least to set out specific information.  In the case of a residential project, that includes serving a copy of “Form 1” of the Act.  If you haven’t met those requirements, then go back and start again:  re-issue the invoice properly, and then use the provisions of the Act to pursue recovery after the (new) time for payment has passed.

·                    Are you a house owner/occupier?  If so, the arbitration provisions of the contract (if any) may not apply:  Unless you signed a specific agreement to waive your rights not to participate in arbitration, then you still have those rights:  i.e. you can decline to participate in the arbitration.  However, our view is that the arbitration provisions in a contract are a sound fair and effective way of resolving disputes, and we recommend that you agree to arbitration.  Whether or not you agree, you cannot avoid being involved in adjudication if served with a notice that you are a party to one arising out of a construction contract.

·                    Preparing for the dispute:  Read the pages on this website about arbitration, and/or the Construction Contracts Act, and/or Mediation, whichever is appropriate.  Then read the pages on this website about Preparing for Disputes.

·                    Appoint an arbitrator/mediator/adjudicator:  See below for more details.  Once appointed, the arbitrator/mediator/adjudicator will plan and manage the dispute resolution process, setting timeframes and procedures as may be appropriate.