Dispute Resolution


In the day to day running of business, there will be a time when disputes arise over a range of issues and these may also involve customers, suppliers, partners and employees.

Resolving a dispute may take up your time, depending on the complexity of the issue. Resolving the issue may also involve effort and money that at time may well be directed and used to perhaps operate, manage or grow your business. So, keep in mind that when resolving issues, try to keep it as cost and time effective and with very little damage to the relationship as possible.

There are several ways to resolve disputes. Many may be resolved vide direct discussion, common sense and informal negotiations between parties. However, it cannot be argued that even more complex circumstances and issue may need to be resolved vide more formal processes. Formal processes may include mediation, adjudication, conciliation and arbitration.

Mediation takes the harmonious path when trying to resolve an issue. One head, as has been mutually agreed by disputing parties is chosen to preside over an issue, in the capacity of a middleman. There are no monetary limit if this resolution is used and the jurisdiction and scope of practice for this is unlimited. In Malaysia, The Malaysian Bar Council has set up the Malaysian Mediation Centre (“MMC’) to cater to various types of disputes and is accessible to all parties in the country.

Adjudication, is primarily a place where disputing parties can focus to complete the works. A third party is thereby appointed to make a binding decision while waiting for litigation or arbitration to take place. The concept is to have a temporary binding decision in place until the works and/or performance of contract is completed.

Conciliation is basically a negotiation and discussion session attended by the disputing parties in the presence of a Conciliator assisting them. It allows disputing parties to resolve a problem and reach a satisfactory outcome for all. The Conciliator may help to parties to try and reach an agreement, but the Conciliator has no power to impose the agreement.

Arbitration, is arguably the most popular alternative dispute resolution method in Malaysia. The nation has its Kuala Lumpur Regional Arbitration Centre (“KLRAC’) which possesses its own arbitration rules and is governed by the Arbitration Act 2005. With a panel of arbitrators registered in Malaysia, these arbitrators are basically professionals and experts in the related fields and industry that will act as the presiding judge to resolve the alleged dispute. Arbitrary powers are not restricted although arbitrators do not possess the power to issue an order to a third party. Awards given are final and binding.

When dealing with internal disputes or others that you would want to attempt to resolve the disputable issues on your own, keep in mind the following tips to ensure optimum results:

Tip 1: Be clear and logical about the facts
Document the relevant details about the dispute. Record dates, times, product or service details, summary of discussions, promises or verbal agreements and the details of each party to the dispute. If there are several problems all relating to the same issue then document each one separately; it may be possible to resolve a few smaller issues one at a time.

Find out about the rights and obligations of each party to the dispute, and if there are any specific organizations you should be talking to. The solution or action required will often be obvious once the rights and obligations are clarified. Record how each party would like the dispute resolved.

Tip 2: Organize the evidence
Collect all documents relevant to the issue (contracts, leases, receipts, warranties, invoices, orders, and photographs). Tag the relevant clauses of any contract or lease. Organise the facts in chronological and subject order.

Tip 3: Identify what you want
Be clear about the remedy being sought by you or the other party. The remedy could include compensation, refund, repair, replacement, an apology, change in behaviour or a combination of these. Ask the other party about what is important to them and what remedy they are seeking. Remember that each party has a common interest in resolving the matter quickly, fairly and cheaply. A direct exchange of information may present a solution that is acceptable to both parties.

Tip 4: Be calm and show respect
Present your case calmly and show respect for the other party's point of view. Animosity from a badly managed dispute can cause long term adverse effects on your business. Be prepared to compromise and give a little when the other party is prepared to do the same.


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