Chapter 10 TRIALS, ARBITRATION, & MEDIATION
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1 275 Chapter 10 TRIALS, ARBITRATION, & MEDIATION CE 420 November, 2007
2 TRIALS AND ARBITRATION 10.1 ARBITRATION Early form of Contracts Owner s Architect/Engineering Sole Arbitrator Eventually thrown out Provisions for an independent arbitrator Execution of the work must proceed.
3 TRIALS AND ARBITRATION Modern Contracts (CCDC.2 ASCE/AGC) Clear cut procedures for settling disputes Save time and money if dispute can be settled by architect/engineer try first Parties can agree that courts have no jurisdiction, except on points of law Independent arbitrators chosen either by mutual agreement or appointed by some qualified professional body - Courts in Saskatchewan
4 TRIALS AND ARBITRATION Advantages and Disadvantages of Arbitration Advantages: Privacy Relative informality Speed of operation Greater confidence of the parties in decision Disadvantage: Technical arbitrator's inexperience in applying the rules of evidence, of sifting and weighing evidence, and of applying the law.
5 TRIALS AND ARBITRATION Provisions for Settlements of Disputes The best solution to many matters that end in arbitration is obviously to remove the basic cause of dispute. Most of the arguments that arise in construction contracts are concerned with unexpected eventualities, or with interpretation of the specified requirements. The former may be minimized by better preliminary investigators and increasing experience in the class of work involved. The latter can be avoided altogether if specification writers have a proper appreciation of the meaning of words and phrases, and their correct use in a technical, literal and legal sense - and, if the compilation of the contract documents is logically and efficiently carried out.
6 TRIALS AND ARBITRATION Provisions for Settlement of Disputes (Con t) Because such arguments do arise, however, an arbitrator must exercise both engineering and legal judgment in arriving at his determination. An arbitrator is a judge of facts On points of law, he may: Seek assistance from the parties lawyer Seek council themselves Finally arbitrator must make his/her decision on his own
7 TRIALS AND ARBITRATION To administer oaths to the parties and witnesses To state an award as to the whole or part thereof in the form of a special case for the opinion of the court; and To correct in an award any clerical mistake or error arising from an accidental slip or error (Recent jury not guilty verdict)
8 TRIALS AND ARBITRATION TRIALS AND APPEALS Resolution of disputes by the courts lengthy and costly Length of time over which the contract takes place and the myriad of facts which need to be assessed Examination for discovery takes considerable time Claims may arise out of a series of events, thus, construction and engineering process must be analyzed. Trial takes a long time because many experts and witnesses are usually called
9 TRIALS AND ARBITRATION TRIALS AND APPEALS Preparing for litigation Reviewing and compiling personal records Examination for Discovery - Speculation? Do you have any idea "type" questions? What do you know about that "for certain"? Short answers: to the point based on personal knowledge only Guessing - don't guess - if you don't know for certain - then you can't SPECULATE
10 TRIALS AND ARBITRATION Examination for Discovery 284 Do Not Speculate Take time to answer Ask to see documents - READ CAREFULLY Do not be led - SO ON THE 31ST, YOU KNEW! Watch out for misleading figures and statements in reports Watch out for the statement "WOULD YOU AGREE WITH ME THAT"
11 TRIALS AND ARBITRATION TRIALS AND APPEALS Witness in Court Presenting Evidence Cross-Examination Re-Direct
12 TRIALS AND ARBITRATION 286 Expert Witness Practicing engineer - may have no desire to appear in court as an expert Nevertheless, if she/he or firm is involved in a professional liability claim they will probably have to appear as a witness on technical matters, - and may have to assist - legal council in evaluating evidence presented by expert witness hired by the opposite side in the dispute. He/she will have to give their lawyer a crash course in her/his technical specialty and should expect to receive a crash course on legal procedures! Problem solving in engineering is principally be means of numerical and graphical procedures, while problem solving in law is almost entirely by means of words (Hosmith, 1986) Difficulty in communications between lawyers and engineers Canadian Courts - professional liability cases tried before judge Judge appointed to bench from legal profession
13 TRIALS AND ARBITRATION Expert Witness Communications - Problem Engineer must successfully communicate with the lawyer, whom you hope (based on inclination, training, etc.) will understand and then successfully guide you in the presentation of his side to the judge, who may have had no previous contact with the concepts and branch of engineering - very demanding educational process for all concerned. Lord Alwyn Jones - address to College of Law, U of S. concerning a Justice of the Court of Appeal. Judge complained to solicitor who was explaining his case in great detail "You must give us credit for knowing something" Council replied "That was the mistake I made in the lower Court, my Lord". Objective of courtroom procedure is to present to the judge the case and remind him of the applicable law. Judge, based on facts presented, form is own opinion as the basis of his judgment. Legal system assumes judge capable of making correct decision based on the facts. Witnesses limited to presenting the facts - prohibited from expressing opinions since this would usurp the responsibility of the judge to form an opinion based on the facts. One of the FEW EXCEPTIONS to this rule. Expert Witness - may express an opinion based on the facts presented to him. 287
14 TRIALS AND ARBITRATION 288 Expert Witness Courts recognize that a person who is by training and experience an expert is better qualified than a lay person to arrive at a correct opinion based on facts in his field of expertise. i.e. Ballistics Expert Still an opinion and may be ignored by the court. In general the engineering profession does not present the united front against professional liability claims that is often ascribed to the medical profession. As a result - lawyers can often find "expert" to support the case against the engineer. Thus, engineer will have to assist his lawyer in evaluating and possibly discrediting the evidence of the expert. Most effective expert witnesses appear impartial, authoritative, and logical. It can be assumed that very few expert witnesses are completely impartial and unbiased. Expert must appear unbiased. Authority of Expert - usually indicated at the onset of his/her testimony. Expert - Authoritative - but not dogmatic & Not qualified outside their field. Experts - Paid well, lawyers may not adequately prepare in order to save money. An expert witness should be thoroughly prepared by his lawyer so that he is aware of the significance of his testimony in relation to the testimony of other witnesses and the case as a whole.
15 TRIALS, ARBITRATION & MEDIATION 289 Mediation Judicially Assisted Mediation Takes place after Examination for Discovery The Court of Queen s Bench judge reviews the material submitted The parties meet before the judge, together or separately depending on the jurisdiction and verbally present their case All discussions without prejudice Parties encouraged NOT to use adjectives which bring more heat than light! If not settled in mediation, a different judge will hear the case in court, so views expressed by the judge in the mediation are his views only and it is possible that the trial judge may have a different view. The mediation judge s views are likely representative of the views to be expressed by a trial judge. Judge tries to identify areas of exposure for both parties. Contract Interpretation Intentionalist Basis Strict Basis
16 TRIALS, ARBITRATION & MEDIATION 290 Case Study KPCL vs Manitoba Water Resources Branch (MWRB) Rosenort, Manitoba Town of Rosenort vulnerable to flooding of the Morris River MWRB and RM of Morris commissioned KGS to design a diversion channel that would handle overflows from the Morris River KGS handled construction management KPCL was awarded the contract for construction of the flood protection works Centerline of Channel Tobacco Creek Dam Morris River Tobacco Creek Creek Centerline of Dyke Inlet Structure Town of Rosenort Outlet Structure
17 TRIALS, ARBITRATION & MEDIATION Case Study KPCL vs Manitoba Water Resources Branch (MWRB) 291 Four Areas of Claim: 1. Overhaul 2. Flooding 3. Siemen s Stockpile 4. Stop Work Orders Morris River Disposal Area 2 Disposal Area 1 Tobacco Creek Inlet Structure Town of Rosenort Tobacco Creek Dam Creek Disposal Area 3 Outlet Structure
18 TRIALS, ARBITRATION & MEDIATION Case Study KPCL vs Manitoba Water Resources Branch (MWRB) 292 OVERHAUL CLAIM $321K KPCL had intended to stockpile on the dykes No specific mention in contract of where material was to be stored Reference to Disposal areas, small in capacity 88 m 243 m 6:1 3:1 240 m 237 m 6: m varies Dyke Channel
19 TRIALS, ARBITRATION & MEDIATION Case Study KPCL vs Manitoba Water Resources Branch (MWRB) 293 OVERHAUL CLAIM Dam Stockpile on Dyke Dam Stockpile not allowed on Dyke Disposal Area 3 Disposal Area 3 Siemen s Stockpile Channel Dyke INTENDED HAUL BOTTOM CHANNEL EXCAVATION Outlet Structure HAUL HAUL AS-HAULED BOTTOM CHANNEL EXCAVATION Outlet Structure
20 TRIALS, ARBITRATION & MEDIATION Case Study KPCL vs Manitoba Water Resources Branch (MWRB) OVERHAUL CLAIM - What the Judge thought: There was not full disclosure. There needed to be enough space to SAFELY store the stockpiled material on land provided by the Manitoba government. KPCL should have discussed their plan for stockpiling with the engineer. The site was not furnished (accessible) at the time construction started, therefore KPCL had to change their working plan. KPCL could have walked away from the contract at that time, but they did not. Therefore the failure of the government to furnish the site is not a major point in the case. Overall, the OVERHAUL CLAIM is not a strong claim 294
21 TRIALS, ARBITRATION & MEDIATION Case Study KPCL vs Manitoba Water Resources Branch (MWRB) 295 FLOODING CLAIM $400K In 2000, the weather conditions were extremely wet. By Sept 11, the contractor had 50 working days in and had lost 33.5 days due to rain. The first 15 days in November were also lost to rain. In 2001, by September 12, 30 days had been lost again to rain.
22 TRIALS, ARBITRATION & MEDIATION 296 Case Study KPCL vs Manitoba Water Resources Branch (MWRB) FLOODING CLAIM Morris River A small creek that crossed the proposed diversion channel was not accounted for in the design or construction sequence. The creek carried flood waters from all the rain into the working area, creating delays and extra work (pumping water out). Tobacco Creek Inlet Structure Town of Rosenort Tobacco Creek Dam Creek Outlet Structure
23 TRIALS, ARBITRATION & MEDIATION Case Study KPCL vs Manitoba Water Resources Branch (MWRB) 297 FLOODING CLAIM What the Judge thought There are two issues 1. Having to deal with a very large rainfall in the summer 2000 Were those costs built into the KPCL bid price? The surface water specification likely required the contractor to handle dewatering, however this may be unfair 2. Was the precipitation sufficiently large that it could not have been reasonably anticipated? KPCL should get extra compensation as the rain fall was sufficiently large
24 TRIALS, ARBITRATION & MEDIATION Case Study KPCL vs Manitoba Water Resources Branch (MWRB) 298 WORK STOPPAGE ORDER CLAIM $87K This project was intended to be completed in In October of 2001, the engineer (KGS) gave FPCL a stop work order. According to the engineer s calculations, the pore water pressures in the fill at the Tabacco Creek Dam had reached an unacceptable level and needed to dissipate before further fill placement. The calculated value used to determine if it is safe for work to proceed is based on the difference between measured pore water pressures and the initial pore water pressures. The contractor was informed that they would have to wait until spring to continue work. The suspension of work was negatively impacting the contractors cost.
25 TRIALS, ARBITRATION & MEDIATION 299 Case Study KPCL vs Manitoba Water Resources Branch (MWRB) WORK STOPPAGE ORDER CLAIM The expert witness commissioned by KPCL (a Geotechnical Engineering Consultant), reviewed the documented piezometer readings and construction progress reports. The piezometer had been installed after construction had already started. Piezometers can take up to 3 months to come to equilibrium and correctly read the pore water pressure. Without an accurate initial reading, the change in pore water pressures could not be calculated accurately. The consultant expert witness determined the background water table and used that to determine the initial pore water pressures. Using this initial value, their calculations determined that the pore water pressures were within acceptable and expected values for fill placement.
26 TRIALS, ARBITRATION & MEDIATION 300 Case Study KPCL vs Manitoba Water Resources Branch (MWRB) WORK STOPPAGE ORDER CLAIM What the Judge Thought It was clearly set out in the contract that no claims could be made against the owner for delays incurred on part of the owner The stop work order sent to KPCL by KGS because the pore pressures were too high was a bit unfair. A trial court judge may rule in KPCL s favor.
27 TRIALS, ARBITRATION & MEDIATION Case Study KPCL vs Manitoba Water Resources Branch (MWRB) SIEMEN S STOCKPILE CLAIM $100K??? 301 A stockpile was required and the contractor made arrangements with a local landowner, Siemen, to use his land temporarily. Costs associated with this were to be paid by the owner to KPCL. Unfortunately the material placed in the stockpile was not suitable for use in the fill.
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