Alternative Dispute Resolution: Civil and Commercial Disputes During COVID-19 and Beyond

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Alternative Dispute Resolution: Civil and Commercial Disputes During COVID-19 and Beyond

 

Various mechanisms exist through which an aggrieved party can seek to resolve a civil and/or commercial dispute with another party, most notably through the use of the traditional court-based litigation system. South Africa has inherited an adversarial civil justice system from English law, with the traditional court-based litigation system being the primary means to address dispute resolution between parties. The court-based litigation system unfortunately has many disadvantages. These disadvantages include, but are not limited to:

• long and unreasonable delays, which result in court backlogs;
• high costs associated with litigation;
• complexity of the litigation process;
• protracted and lengthy trials; and
• the general breakdown in relationships between parties.

With the recent extension of the national lockdown until Friday 1 May 2020, the abovementioned disadvantages to the traditional court-based litigation system will continue to frustrate litigating parties and legal practitioners in the ensuing months.
In terms of the current lockdown Regulations, the courts in South Africa remain open during the national lockdown period to hear and adjudicate on urgent matters only. Non-urgent matters may not be placed on the roll during the national lockdown, whilst restrictions have also been placed on the issuing of new applications and actions.

The Constitution of the Republic of South Africa, 1996, lists human dignity, equality and the advancement of human rights and freedoms as the founding values of the nation. In terms of section 9(1) of the Constitution, everyone is regarded as equal before the law as well as having the right to equal protection and benefit of the law. It can be argued that the traditional court-based litigation system, especially in light of the COVID-19 lockdown, hinders South Africans full enjoyment of these rights.

Alternative dispute resolution (hereafter referred to as “ADR”) mechanisms offer parties attractive alternatives to the traditional court-based litigation system. ADR mechanisms include:

• Facilitation;
• Conciliation;
• Mediation; and
• Arbitration.

ADR mechanisms can be less expensive, more time-efficient and result in less conflict between disputants. ADR mechanisms further assist disputants to resolve conflict through processes and procedures that are best suited to their personal needs. It is for this reason that the South African Law Commission also refers to ADR as appropriate dispute resolution mechanism.

The various forms of ADR in South Africa

Mediation, as a form of ADR can be defined as the process through which parties use the assistance of an objective third party, in an attempt to reach a settlement between them. Mediation is informal, flexible, confidential and voluntary in nature. It is the role of the mediator to help facilitate discussions between the disputants in order for them to better understand the issue(s) in dispute. The mediator also assists the disputants in attempting to reach a final agreement on their own terms.

Conciliation is another form of ADR available to disputants who wish to resolve a matter in an informal, flexible and confidential manner, by reaching an amicable dispute settlement. The difference between mediation and conciliation entails that a conciliator will provide the parties with a non-binding settlement proposal.

Arbitration in South Africa is governed in terms of the Arbitration Act 42 of 1965. The referral of a dispute to arbitration is often agreed to by the respective parties in the form of an agreement. Arbitration agreements generally deal with issues such as the referral of a dispute to arbitration, who can be appointed as an arbitrator and what powers the arbitrator may have during the arbitration proceedings. An arbitrator considers the evidence and legislation relevant to the particular matter in dispute and makes a decision known as an arbitration award. Such an award is generally binding in nature.

In terms of Rule 41A, which is an amendment to the Rules regulating the conduct of proceedings in the High Court of South Africa, parties to new action or application proceedings are, as of 9 March 2020, compelled to consider mediation as a method to resolve the dispute before litigation.

In light of the above, and considering the far-reaching effects which the COVID-19 pandemic has and will continue to have on the South African legal system, it is advisable for parties to existing and new disputes, to consider ADR methods as a means to resolve their respective disputes in the most effective and efficient manner possible.

Should you require any assistance or advice in settling a dispute through conciliation, mediation or arbitration, or if you require any further information on ADR mechanisms, contact us on MGerber@dacct.co.za

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