Arbitration
Arbitration is a formal dispute resolution process where parties agree to submit their dispute to an independent person called an arbitrator, for a binding decision. The process is governed by the Arbitration Act 1996 and the BDT Arbitration Rules. The arbitrator’s decision (an award), binds the parties and is enforceable as a judgment of the Court.
Process Overview
Arbitration gives the parties the power to choose their decision maker, place and time of a hearing(if they choose to have one), and the arbitration procedures, which may be tailored to the nature and complexity of the dispute. (One or more arbitrators are called the ‘arbitral tribunal’. We refer to the ‘arbitrator’ interchangeably with ‘arbitral tribunal’.)
Starting the process
The parties need to agree to arbitrate. They can do this before or after the dispute has arisen.
Appointment of an arbitrator (arbitral tribunal)
The arbitrator will typically be appointed within 3 Working Days.
Directions conference
This conference is intended to promote the efficient conduct of the process.
Submission of case
Each party submits a written statement outlining the facts, evidence, and legal arguments.
Hearing
There may be a formal hearing, although it is also common for arbitrations to be conducted on the documents without a hearing.
Additional information, site visits and inspections
The arbitrator may request further information from any party.
Award
The arbitrator makes their award, which binds the parties.
Cost of arbitration
Our focus is on delivering cost-proportionate process solutions. Find out more about the cost of arbitration.
Step 1. Starting the process
To begin, both parties must agree to use arbitration.
They can do this by signing an arbitration agreement after a dispute arises.
Alternatively the parties may have included the Building Disputes Tribunal model arbitration clause in their contract. This allows any future disagreements or disputes to be settled using arbitration. If they did so, the person wanting to initiate the process (called the claimant) must send a Notice of Arbitration to inform the other party (the respondent) that they want the dispute resolved by arbitration.
To start the process, the claimant applies to BDT. A Registrar will then be assigned to the case to assist the parties, their advisors, and the arbitral tribunal throughout the arbitration process.
Step 2. Appointment of an Arbitral Tribunal
The Building Disputes Tribunal (BDT) is responsible for appointing the arbitral tribunal unless the parties have already agreed on who they want to appoint.
The arbitral tribunal usually consists of one arbitrator, but in some cases, a three-person tribunal may be appointed. BDT makes an appointment once it receives a completed application and payment of security for the arbitral tribunal’s fees and expenses.
If the parties have someone specific in mind, that person must meet certain criteria, and BDT must approve them as being suitable, independent and impartial.
When selecting an arbitrator, BDT considers various factors such as any agreements between the parties, the nature and value of the dispute, and the availability of the person to handle the case effectively and efficiently. The appointed arbitrator must be impartial and independent of the parties. Any appointment by BDT is final and confirmed with a Notice of Appointment issued by the Registrar.
Note: The terms arbitrator and arbitral tribunal are used interchangeably.
Step 3. Directions conference
Usually, the arbitrator organises a preliminary conference. The purpose of this meeting is to talk about timetabling and procedural details, such as what information the parties plan to provide and by when. This proactive approach to managing the case helps ensure everyone is clear about what will happen and when, and it encourages the process to run smoothly and efficiently.
Step 4. Submission of case
Following the preliminary conference, each party must prepare and send their case submission to the arbitrator and all other parties involved. This submission should contain all relevant supporting documents and evidence.
The case submission must clearly explain the nature and basis of the dispute, the factual and legal issues, each party’s position on these matters, and the outcomes they seek. If a contract is involved, a copy or relevant sections of it should be included. Additionally, the submission should contain any statements, reports, documents, or other evidence the party relies on to support their arguments.
Typically, the process for exchange will consist of:
- The claimant(s) serving their claim;
- The respondent(s) serving their defence; and
- The claimant(s) serving any reply.
Step 5. Hearing
Once the parties have exchanged all relevant documents, and unless they’ve agreed to proceed based solely on those documents (without a hearing), a formal hearing will be scheduled.
In most cases, the parties may make a brief opening statement before any witnesses are cross-examined. Witness evidence is usually taken as read, meaning there is no need for the witness to present their evidence-in-chief orally. Instead, the hearing will focus on cross-examining the witness based on their written witness statement. The arbitral tribunal may also ask questions of any witnesses.
Closing submissions may be provided at the end of the hearing, usually in writing after the hearing date.
Step 6. Additional information, site visits and inspections
An arbitrator can ask for more information at any time before making an award (the decision), for example if they feel the submissions from the parties are not detailed or clear enough for them to make an informed and fair decision.
When any requested additional information is submitted, each other party involved in the dispute has the right to submit a response. This response should be filed with the arbitrator (via BDT) and every other party.
Sometimes, a site visit or inspection might be needed, especially if the disagreement involves physical assets, locations, or conditions that need to be seen firsthand for an accurate understanding and assessment. This allows the arbitrator to see the subject matter of the dispute in its actual context, and enables a more informed and accurate decision.
Step 7. Award
The arbitral tribunal is responsible for issuing an award that decides each of the disputed matters referred to it.
This comes after carefully reviewing submissions, documents, evidence provided by the parties, any information from the hearing, and any extra information requested.
Unless the parties agree otherwise, the award is provided in writing and includes an explanation of its reasons. An award is legally binding and enforceable for all parties to the arbitration.
Scrutiny of Award
The Building Disputes Tribunal is committed to delivering consistent, certain and professional arbitration services of the highest possible standard. Unless a party objects, each award is scrutinised by one of the BDT’s legally trained quality reviewers before being given to the parties. This is a quality assurance process and a key element of the service.
Scrutiny of an award is aimed at identifying any errors in computation, clerical or typographical errors, or any errors of a similar nature, and any errors as to form.
BDT may draw the arbitrator’s attention to any points of substance or internal inconsistencies in the award, but this does not affect the arbitrator’s independence and autonomy. The award is that of the arbitrator.
Get in touch
Fill in the form to contact our team to see how we can help or get in touch with us with either of the following:
Phone: +64 9 486 7143
Freephone: 0508 BUILDING
Freephone: 0508 284 534
Office Hours: Monday to Friday 8:30AM to 5:00PM (excl. public holidays)