Practitioners’ Perspectives on the Future of Alternative Dispute Resolution (ADR)
and the Relevance of the Law Society’s ADR Schemes
With a growing number of individuals and companies using the Society’s “LSXS” (a collective term we will use for reference to the Law Society Arbitration Scheme [LSAS], the Law Society Mediation Scheme [LSMS], and the Law Society Neutral Evaluation and Determination Scheme [LSNEDS]) to resolve their disputes, the Law Society is encouraged by the headway it is making in the alternative dispute resolution (ADR) sphere in Singapore.
The feedback which we have received for LSMS for instance has revealed that our users are generally satisfied with our service as high ratings were given for the quality of the mediator(s), administrative support received and overall experience. With 5 being the highest rating on the scale, about 94 per cent of our users have given 4 and 5 ratings.
As we continue to seek ways to improve the quality of our service, we want to find out from the senior practitioners how the LSXS would feature in today’s commercial world.
We invited two leading practitioners in the field of dispute resolution – Mr Randolph Khoo, FSIArb, FCIArb, FMIArb, FAMINZArb, FHKIArb, FICA and Mr Rengarajoo Balasamy, PBS, Chartered Arbitrator, FCIArb, FSIArb – to share with us their perspectives on the future of ADR in Singapore and on the relevance of the Society’s LSXS in this dynamic landscape.
Randolph is the Deputy Managing Director of Drew & Napier LLC’s Dispute Resolution Department. He heads the dispute resolution practices of its Greater China, India and International Trade Desk and Private Client Disputes Group. In the area of arbitration, he has been endorsed by Chambers, Asia Pacific Legal 500, Benchmark Litigation and Best Lawyers International for international arbitration and arbitration in Singapore. Randolph is also a panel arbitrator with various arbitral institutions in Singapore, Asia and in Russia.
Rengarajoo is a seasoned dispute practitioner with 36 years of experience under his belt. He is no stranger to mediation, having trained and practiced mediation since 2004. He was the only participant from Asia to attend the first European Union (EU) approved 90-hour standardised mediation training for the “European Mediation Training for Practitioner of Justice” that was held in 2010 at Warwick University, Coventry, United Kingdom. This was recognised by 17 mediation centres across Europe including the Chartered Institute of Arbitrators (CIArb). A Principal Mediator with the Singapore Mediation Centre (SMC) and, Singapore International Mediation Institute and International Mediation Institute (IMI) certified mediator, he has assisted as a coach in the training courses conducted by the SMC and Singapore International Dispute Resolution Academy. He was also one of the assessors for the first mediation course conducted by CIArb in Kuala Lumpur, Malaysia. Rengarajoo has mediated over 150 cases for the various mediation organisations and Centers including the State Courts with an impressive success rate of about 80 per cent.
Q1: What are your thoughts on the future of ADR in Singapore? Have you noticed any notable trends and/or developments in the ADR space?
Randolph: The future of ADR appears to be bright. Institutional advances are being made towards affording parties in disputes an ever widening array of ADR mechanisms and options.
The Law Society for instance, launched the LSNEDS just recently on 17 September 2018. The Singapore Construction Mediation Centre just opened its doors on 12 March 2019. Singapore now has a formidable suite of ADR processes and institutions that can cater to disputes ranging from those between national governments and international investors in Investor-State arbitrations to resolving social and community friction and consumer grievances (e.g. via Community Mediation Centres [CMC] and the CASE Mediation Centre respectively). In between, may be found a slew of ADR institutions like the Singapore International Arbitration Centre (SIAC), SMC, Singapore International Mediation Centre (SIMC), Singapore Institute of Arbitrators, LSAS and others.
Singapore also takes its place on the international stage with the United Nations General Assembly recently adopting on 20 December 2018 an international convention to facilitate enforcement of international settlement agreements arising from mediation. This convention will be named the Singapore Convention on Mediation (SCM), which is expected to come into force in August 2019.
An inescapable conclusion is that ADR is going to be very much a feature of the Singapore legal landscape ahead.
Rengarajoo: To some eminent personalities in the field of dispute resolution, ADR is popularly and rightly known as Appropriate Dispute Resolution. In this sense for many, I venture to say as a mediator, ADR is almost synonymous with mediation and as observed, the trend is to moving towards mediation. This is evident from the numerous public and private mediation organisations that have sprouted in the last decade or so.
In connection with this, we can take a leaf from one of the Directives of the EU for the future of ADR in Singapore. In May 2008, the Council and Parliament of the EU published a Directive on Mediation12008/52/EC. for implementation throughout all member states of EU by 2011. This initiative was to resolve cross border disputes among member states. The Directive provides, among others, the training of mediators and more importantly the enforcement of mediated settlement agreements. It is suggested that a similar arrangement could be considered for members of the ASEAN countries to encourage cost-effective and quick alternative to litigation for business disputes between parties in different ASEAN countries. There should not be any issue as regards enforcement of the settlement agreements. Besides providing for enforcement in the arrangement among member countries, parties could also take advantage of the SCM that will see its birth soon, by becoming a member of the SCM.
The other aspect of the Directive, a standardised training for all the EU member countries, will be a way forward for regional and international mediation in time to come. This is something which is worth emulating as Singapore moves towards seeing mediation as an international dispute resolution mechanism for cross border dispute, particularly in view of the SCM.
Q2: What do you think is the role of ADR in the resolution of commercial disputes? Should ADR be businesses’ “first port of call” before commencing any formal proceedings?
Randolph: Full scale litigation, like wars, are easy to start or easily started without much thought. Once the shooting begins, getting to a ceasefire is one of the hardest things to achieve.
That being so, legal disputes are the antithesis of commercial life. Providing expedient, reasonable and face saving “exits” from hostile situations is a sensible way to return business interests to their primary goals of economic productivity.
Providing an ADR option prior to or even in the midst of formal proceedings is undoubtedly a useful avenue to reducing commercial conflict in my view.
Rengarajoo: What the Chief Justice noted in his keynote address at the launch of the LSMS on 10 March 20172Click here to read the full keynote address. was apposite in considering the role of ADR in the resolution of the civil and commercial disputes. He cited five ideals, namely affordability, efficiency, accessibility, flexibility and effectiveness.
Mediation as an ADR provides these ideals that should be taken advantage of by the parties. This entails some education of the consumers, vendors and other people in the commercial world. In any dispute, it has been the practice, the first port of call is a lawyer’s office with a view to commencing legal action. This is the mind-set that has to be changed. The Government and various dispute resolution institutions have rolled out various initiatives to encourage the resolution of disputes by mediation, for instance, CASE Mediation Centre, CMC, Court Annexed Mediation and other dedicated mediation centres, like the SMC and the SIMC. This is further enhanced by the Mediation Act3No. 1 of 2017. with respect to enforcing the settlement agreement that satisfies certain provisions of the Act.
From experience and by observation, most of the disputes that are resolved at mediation had commenced action in the Courts. The disputants, I believe, needed some encouragement, currently invariably from the Courts for them to take it to mediation. The Law Society and the Courts have put several ADR mechanisms in place. The parties and their legal representative would be better off if these ADR mechanisms are considered in place of litigation if it is to the parties’ benefit especially to reduce acrimony.
Q3: You are serving on the LSAS Panel of Arbitrators (Randolph) / LSMS Panel of Mediators (Rengarajoo). Could you share with us your experience with LSAS / LSMS so far?
Randolph: The LSAS is a far simpler and more economical cousin of SIAC. It is cost effective and quicker. There is in comparison, minimal institutional involvement.
LSAS arbitration, at the moment, conduces itself more to straightforward domestic disputes despite the absence of any restriction against international disputes being resolved before the LSAS. The mix of LSAS panel arbitrators is distinctly local and therefore has its merits in resolving such disputes readily.
Rengarajoo: If one compares the quality and standard of mediation under LSMS with other mediation institutions, in my view there is no material difference. Most of the LSMS mediators are for instance also on the SMC Panel either as Principal Mediator or Associate Mediator.
In addition, all our LSMS mediators are practising lawyers. What comes to mind is a survey conducted by the IMI some years back to gauge any preference for lawyer mediators (as opposed to non-lawyer mediators). The poll showed about 70 per cent polled preferred lawyer-mediators.
Q4: Based on your experience, what types of cases are suitable for LSAS (Randolph) / LSMS (Rengarajoo)?
Randolph: At the moment, local disputes calling for speed and low costs of dispute resolution appear well suited for LSAS arbitrations. In the interest of developing arbitration expertise at the local Bar though, there is really no reason why efforts cannot be made to promote use of the LSAS amongst wider ranges of users.
Our transactional lawyers at the Bar can also carry the torch and assist with proposing LSAS as an alternative or complementary arbitration processes to SIAC or other institutional arbitration. I can think of say a Singapore law governed contract having a disputes clause that allocates disputes below a certain sum to LSAS and then having disputes of a defined type or quantum being with another institution or perhaps a choice given to go elsewhere with the default being the LSAS.
Rengarajoo: LSMS is suitably equipped to mediate most of the disputes that find their way to the national Courts. Save for some family disputes, almost all the civil and commercial disputes are suitable for resolution by LSMS.
Although LSMS was conceptualised with domestic mediation in mind, in the long term, I do not see why LSMS should or could not cater for international commercial disputes. Some of the mediators on the LSMS Panel have participated in a two-day pilot Intercultural Training Program conducted by the IMI in January 2012. This is significant in moving mediation to a greater level internationally.
Q5: Who do you think will benefit the most from LSAS (Randolph) / LSMS (Rengarajoo)?
Randolph: At the moment, with its arbitrators drawn from the local Bar, local disputes which call for a good understanding of local Singapore law and conditions, speed, low cost and privacy would be ideal for the LSAS.
There may be industries in which the features of LSAS arbitration may be suitable. Some industries like building and construction, already have a large number of disputes efficiently filtered out by the Building and Construction Security of Payment Act4Cap 30B. via the SMC adjudication processes and residual disputes dealt with by SIAC, Singapore Institute of Architects or other well-known construction disputes arbitration rules. Maritime and real estate disputes have the Singapore Chamber of Maritime Arbitration and Singapore Institute of Surveyors and Valuers Dispute Resolution Centre in place.
However, a range of other fields like say medical-legal disputes, where there are interests in preserving sensitive medical and professional confidentiality, or financial services, including banks, private wealth investments etc, where publicity is not welcome, may be good areas to consider promoting LSAS arbitration.
Rengarajoo: Many disputants dread to go to Court because of the cost factor. Not every plaintiff or defendant has the means or is eligible for legal aid in the alternative. To those who fall under this category, justice is invariably denied. It is here where LSMS as a form of dispute resolution mechanism improves access to justice. Mediation with all its ideals is intended to benefit those disputants who desire to preserve their relationship in addition to all other advantages that are inherent in mediation.