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Published 2 November 2016
Adjudication – a voluntary ADR alternative in professional negligence disputes
A revised pilot scheme for Adjudication of Professional Negligence claims was recently launched, expanding the range of cases that may benefit from this form of ADR.
The original scheme ran from May 2015 and was limited to solicitors’ negligence cases capped at a value of £100,000. The revised scheme abandons the cap and opens itself to any professional negligence dispute.
Both (or all) parties must agree to utilise the scheme. They may agree to select one of the panel adjudicators (with the adjudicator’s agreement) or, when referring their case to the scheme, ask the chair of the PNBA to select an adjudicator.
If the adjudicator accepts the appointment (and the parties continue to accept the appointment after any disclosure by the adjudicator), then the Terms shall be agreed in writing by the parties.
Once appointed, the Adjudicator will give directions for the exchange of witness evidence and may seek additional documents. A short hearing in person or telephone may take place but is not the intended norm - the Adjudicator will usually decide the dispute based on the documents only.
The decision will be in writing with reasons, within 56 days of the appointment (unless extended by agreement).
The extent to which the decision is binding on the parties shall be agreed by the parties by the time of the appointment. If temporarily binding only, a losing defendant would have to pay any award in the claimant’s favour and then seek to recover that payment by issuing proceedings itself.
The parties can select pre-defined options as to how the adjudicator will deal with costs, or agree the costs rules themselves.
The scheme is now intended for all professional liability disputes. ‘Professional’ isn’t strictly defined but the parties should be able to agree by reference to established categories.
Although the financial cap has gone, the scheme is not intended to be used where detailed and complex evidence of experts and lay witnesses is required to deal with issues of, for example, breach of duty and causation.
Ultimately, identifying the right cases and the right opponents with which to take the step into voluntary adjudication may not be straightforward, but the expanded scheme appears to be one which defendants and their insurers would do well to keep in mind and to seek to trial, particularly in those cases where the value of the claim lends itself to costs swiftly becoming disproportionate.
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