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When you run a business, things may not always go to plan. One issue that can arise is that you fall into a commercial dispute with another company. Should this arise, you must aim to resolve it as efficiently and effectively as possible. To avoid lengthy and expensive litigation, you may instead consider expert determination to resolve your dispute. However, if you are unhappy with the outcome, it is important to know how and when you can challenge it. This article will explain whether your business can challenge an expert determination for your commercial dispute.
How Does Expert Determination Work?
Before understanding whether or not your business can challenge an expert determination decision, you need to know how expert determination works. Expert determination is an alternative dispute resolution (ADR) method that can be used for commercial disputes. Therefore, it is an alternative to formal and costly litigation. Since there are no specific legal processes for expert determination, you and the party are responsible for deciding the procedure. In particular, both parties must choose an independent expert, who will make a decision on the dispute. This is a binding and final decision.
Crucially, you should be aware of the types of commercial disputes expert determination suits best. This method is most appropriate for technical matters in a disagreement. Therefore, it is not well suited to disagreements regarding misaligned facts or legal interpretation. Consequently, you should select your expert by their skills in the disputed technical area.
Can My Business Challenge an Expert Determination Process Decision?
As discussed above, the decision made by the independent expert in their determination is binding and final. As a result, there are limited avenues to appeal the expert’s decision. Courts tend to respect the decision of an expert in technical disputes and, therefore, rarely dispute their decision as binding. This can be an advantage of expert determination as it means you know that once the decision is made, the commercial dispute is resolved and closed. However, it may be less beneficial if the final decision does not meet your interests. As such, we explore some appeal channels you can take below.
1. Procedural Unfairness
One reason you may be able to appeal an expert determination decision is because procedural unfairness occurred during the process. This could be, for example, that the expert treated you less fairly than the other party such as by giving you less time to gather evidence for your case. Alternatively, they may have given less time to hear your argument.
2. Mistake
Using mistake to appeal an expert determination decision will likely be very limited in its application, but it is still a potential ground for appeal. To prove this, you must show the expert made a plain and obvious mistake, otherwise called a ‘manifest error’. The English courts have qualified the meaning of ‘plain and obvious’, saying mistakes must be “oversights and blunders, so obvious as to admit no difference of opinion”. Furthermore, the other party must have agreed on mistake being an exception to the decision being binding.
3. Collusion or Fraud
If the independent expert determining the decision in your commercial dispute carries out fraud or conspiracy, you can appeal their decision. However, you will need to prove that this is the case first. You will also have to agree in advance with the other party that fraud is an exception to the decision as binding. Similar to appealing for mistake, it will be limited in its application.
4. Terms of Reference
You and the other party, upon deciding to use expert determination for your dispute, may have contractually agreed to terms of reference. If so, this will detail the procedure for the expert determination. If the expert does not work within these terms, you may be able to appeal their decision.
This guide outlines how to resolve commercial disputes.
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Key Takeaways
If you have a commercial dispute with another business, you may choose expert determination to resolve it. This is an alternative dispute resolution method with no specific legal processes, allowing you and the party to develop your own procedure. It involves appointing an independent expert to make a binding decision on the dispute. Expert determination works best for disputes about technical issues rather than factual or legal. There may be cases where you are unhappy with the final decision and wish to appeal. To do so, some possible appeal avenues are arguing that:
- there was a lack of procedural fairness;
- the expert made a mistake;
- there was collusion or fraud on the expert’s part; or
- the expert did not follow the terms of reference in the contract between you and the other party.
If you have any further questions about challenging an expert determination decision, LegalVision’s experienced disputes lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.
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