Introduction
ADR is the name used for different ways of solving a dispute. For example, mediation, arbitration, adjudication and ombudsmen are all types of ADR. In many circumstances they are alternatives to going to court – which is why they are sometimes known as ‘alternative dispute resolution’. Alternative dispute resolution (ADR) consists of a variety of approaches to early intervention and dispute resolution. Many of these approaches include the use of a neutral individual such as a mediator who can assist disputing parties in resolving their disagreements.
The main ADR alternatives to civil litigation are negotiation, arbitration, conciliation and mediation. The increased popularity of ADR methods has been due to the overloading of cases in the normal courts of and the disputing parties use these ADR methods because they are expeditious, private, and generally much less expensive than a trial.
We will draw much emphasis on looking at the parties’ agreement before taking a decision to go for ADR and after when a final settlement also known as final agreement in ADR is reached.
Mediation Is a voluntary, private and nonbinding process in which a neutral person (the mediator) assists the parties to reach a negotiated settlement. The mediator’s role is more pro active than that of a conciliator but a mediator does not have power to make any decision or award. Mediation is sometimes referred to as assisted negotiation and it employs a problem-solving approach to address conflict rather than the traditional, adversarial method. Mediation allows parties to control the dispute resolution process, rather than having a judge or some other official control it for them. Mediators are not decision-makers or judges and have no personal interest in the substantive outcome of a case but rather use their expertise in communication and negotiation to help the parties make effective, informed decisions on their own.
Negotiation
Negotiation is the processes in which parties that perceive one or more incompatibilities between them, try to find a mutually acceptable solution.Negotiation therefore is characterized by voluntariness of the parties where no third party is involved in imposing the resolution or a party forced to participate. Negotiation can involve two, three or dozens of parties and is Non-adjudicative since it involves only the parties and the outcome of a negotiation is reached by the parties together without recourse to a third-party neutral.
Arbitration
Arbitration is a procedure applied by parties to the dispute requesting an arbitrator or a jury of arbitrators to settle a legal, contractual dispute or another related issue. Arbitration is characterized by voluntary participation of the parties with the presence of a third party who as a private judge imposes a resolution. Arbitrations often occur because parties to contracts agree that any future dispute concerning the agreement will be resolved by arbitration. By employing arbitration, the parties lose their ability to participate directly in the process. In addition, parties in arbitration are confined by traditional legal remedies that do not encompass creative, innovative, or forward-looking solutions to business disputes.
Parties’ agreement before ADR
Since ADR is a private dispute settlement mechanism, parties are at free will to choose whether to settle a dispute through one of the methods of ADR. As a general rule, in all matters governed by arbitration, court shall not intervene except where the law provides. Which means that an arbitration agreement put in the parties’ contract is binding on them as it forms a contract. Article 64 provides that Contracts made in accordance with the law shall be binding between parties. They may only be revoked at the consent of the parties or for reasons based on law. They shall be performed in good faith. Similarly an agreement by parties to settle a dispute by mediation is binding on them until it fails then other forms of ADR or court can be involved.
Power to stay proceedings
Mediation and arbitration clauses are now regularly included in commercial contracts in Rwanda as the appropriate mechanism for resolving disputes. The clause usually stipulates that the parties will refer any dispute that arises out of the contract to either mediation or arbitration, where these processes do not result in a settlement the parties are still free to have court proceedings. However important to note is that in arbitration in Rwanda a party can only appeal on the procedural elements but rather not substantive elements of the dispute.
The court before which an action regarding an arbitration agreement is seized shall submit it to the arbitration, if a party so requests, before submitting his or her statements on the substance of the dispute, unless it finds that the agreement is null and void, inoperative or incapable of being performed. Where an action referred to has been brought in a court but before being heard, arbitral proceedings may nevertheless be commenced or continued, and a decision may be taken while the issue is pending before the court. In that case, the action submitted to the court shall be null and void. Similarly if parties had a mediation agreement in their contract courts can distance themselves from hearing such a dispute until a proper mediation process has been concluded.
Stay of proceedings and ADR Clauses
The enforceability of a dispute resolution clause was definitively established by the High Court in Health Service Executive v Keogh, trading as Keogh Software. In this case, the defendant had an extensive software services and maintenance contract with the plaintiff, the HSE, which was at the time of the case in use at approximately 180 sites around the State in connection with radiology, accident and emergency and hospital billing. A dispute arose between the parties, in which the defendant asserted that it had been underpaid by the HSE, and the defendant then ceased to supply the support staff for the software system. The HSE then requested the defendant to supply it with the computer source codes for the software system, which the defendant refused. A contract between the parties included a dispute resolution clause, under which the defendant agreed that the source code, which were held by a third party company, could be released to the HSE ―on the decision of an independent expert whose appointment will be mutually agreed, or, failing mutual agreement, who will be appointed by the President for the time being of the Law Society. The dispute resolution clause also provided that:
The independent expert‘s decision will be final and binding on all parties to this agreement and shall not be subject to appeal to a court in legal proceedings except in the case of manifest error.
Both parties applied to the High Court for interlocutory relief, the HSE seeking a mandatory injunction requiring the defendant to supply the support services contracted for, the defendant seeking to be paid the fees it claimed were owed and to have the dispute resolution clause and expert determination process suspended. Laffoy J stated, in applying the principles set out in the Via Networks case, that there was no reason for the parties to depart from the dispute resolution mechanism provided for in the agreement, and she refused all relief applied for by both parties. She noted that ―an examination of the... agreement clearly demonstrates that its terms are designed to facilitate speedy resolution of a dispute. In other words the principle in these two cases in as much as are English we would wish be instructive in submission, it is clearly stated that where parties agree to use any form of ADR for settlement of a dispute it shall be binding on them, neither party can depart from the earlier agreed settlement mechanism and this has also been the practice in Rwanda.
Severability of mediation and conciliation clauses
In relation to arbitration, the doctrine of severability means that even where the agreement containing an arbitration agreement is alleged to be invalid, the arbitration agreement itself can be valid and thus the question as to the validity or otherwise of the main agreement can be referred to arbitration. In Doyle v Irish National Insurance Co plc, Kelly J held that the arbitration clause survived the voidance of the contract and the defendant was, accordingly, entitled to have the dispute referred to arbitration.
The English Court of Appeal placed a limit on the doctrine of severability in the case of Soleimany v Soleimany in which it was decided that contracts for illegal adventures which are illegal or tainted in their very purpose (such as a contract of co-operation between highwaymen) could not be the subject of arbitration. However, the Court of Appeal in Fiona Trust & Holding Corporation & Ors v Yuri Privalov & Ors required the parties in this case to proceed to arbitration where one party to the contract containing that arbitration clause had purported to rescind the contract as a whole following allegations of bribery. It was held that if a contract were to be invalid for reasons such as bribery, unless that bribery relates specifically to the arbitration clause, the clause survives and the validity of the contract as a whole is to be determined by the arbitrators, not the court. In doing so, it stressed the severability of an agreement to arbitrate from the larger contract of which it was part.
Similarly in Rwanda as seen in Article 7 of law n°005/2008 of 14/02/2008 on arbitration and conciliation in commercial matters and Article 64 of LAW N°45/2011 OF 25/11/2011 GOVERNING CONTRACTS in Rwanda an arbitration agreement is binding on the parties and is not affected by the validity of the main contract itself.
After ADR
The enforceability of outcomes is an important feature of dispute resolution processes. A decision of a court is legally binding and is enforceable by the parties to the dispute and enables the final resolution of a dispute. It is important to note that mediation and conciliation processes are not binding in themselves, but agreements reached through those processes can be made binding. For example, a mediated agreement can be in a binding contract, which can then be enforced in court. It has been argued that mediated agreements may prove to be longer lasting than imposed settlements, such as court orders, because the parties have voluntarily participated in drawing up the terms of the agreement and are, therefore, more likely to adhere to the terms of the agreement. Similarly in Rwanda mediation and negotiation final settlements/agreements are not binding on the parties and only become binding when the parties intend to make them so by way of signature hence making a contract.
In Rwanda, An arbitral award, irrespective of the country in which it was made, shall be recognized as binding. However, this shall not be respected if the country in which the award was issued does not respect the provisions with reference to cases decided in Rwanda. Similarly an interim measure issued by an arbitral tribunal shall be recognized as binding and, unless otherwise provided by the arbitral tribunal, enforced upon application to the competent court, irrespective of the country in which it was issued but subject to the conditions of reciprocity of the interim measures taken by arbitral tribunals in Rwanda.
Conclusion
All in all, mediation and negotiation agreement as forms of dispute settlement can be appealed in courts of law in Rwanda but Arbitration is not appealable and a dissatisfied party can only do so where there was gross violation of the arbitration procedures.
BIBLIOGRAPHY
Laws
LAW N° 005/2008 OF 14/02/2008 on Arbitration and Conciliation IN COMMERCIAL MATTERS in Rwanda
LAW N°45/2011 OF 25/11/2011 GOVERNING CONTRACTS in Rwanda
Health Service Executive v Keogh, trading as Keogh Software [2009] IEHC 419
Doyle v Irish National Insurance Co plc [1998] 1 I.R. 89
Fiona Trust & Holding Corporation & Ors v Yuri Privalov & Ors [2007] E.W.C.A. Civ. 20 (Court of Appeal, January 24, 2007]. See Carey New Guidance on the scope of arbitration clauses (2007) 14(4) CLP 72
Writings
Alternative Dispute Resolution Leaflet, written by Margaret Doyle published by Advice Services Alliance, June 2012 (http://asauk.org.uk/wp-content/uploads/2013/08/Why-use-ADR.pdf)
Alternate Dispute Resolution Handbook at pg.1 (http://www.opm.gov/policy-data-oversight/employee-relations/employee-rights-appeals/alternative-dispute-resolution/handbook.pdf)
http://www.mediate.com/articles/sgubinia2.cfm
Dispute resolution guide by KIRKPATRICK & LOCKHART NICHOLSON GRAHAM LLP, 2005 (http://www.klgates.com/files/Publication/d4e79514-1038-414f-8394 7c2c22272645/Presentation/PublicationAttachment/2b825492-c6d1-46d6-b2db 7f913295536a/Dispute_Resolution.pdf
http://www.lawreform.ie/_fileupload/consultation%20papers/cpadr.pdf
http://www.cs.uu.nl/docs/vakken/vm/college9.pdf
http://assets.cambridge.org/97805217/35216/excerpt/9780521735216_excerpt.pdf
