The German Arbitration Institution (DIS) is the leading arbitration institution in Germany. In 2010, DIS created a suite of procedural rules for alternative dispute resolution, complementing its arbitration rules. As of this week, these rules are finally available in English.
One element stands out in this suite of rules, namely the Conflict Management Rules (Konfliktmanagementordnung; DIS-KMO). These rules are “meta conflict rules”, so to speak: They are designed to assist parties in identifying the dispute resolution mechanism most suited to their needs after the conflict has arisen.
DIS seeks to address the issue that in ADR, “[t]here is no shortage of means. The problem is to assign the suitable dispute resolution procedure to the individual conflict.” The Conflict Management Rues are based on the premise that in certain situations, “[t]he ex-ante allocation of a suitable dispute resolution procedure is impossible, since at the contract’s conclusion it is still unknown which conflict may arise.”
Under the Conflict Management Rules, upon the parties’ request DIS will appoint a conflict manager. A fixed fee of EUR 3,000 applies, covering both the costs of DIS and of the conflict manager. The conflict manager will support the parties in identifying and implementing the optimal dispute resolution mechanism for the dispute that has arisen. The conflict manager will not be making decisions herself or himself, but will structure and moderate the decision-making process and will assist the parties in finding a procedural solution.
The concept was discussed at a joint session of the IBA Arbitration and Mediation Committees in November 2011 at the IBA Annual Conference, primarily in the context of MedArb processes and the creation of mediation windows in arbitration. The panelists could not agree whether the Conflict Management Rules would really help parties to agree ex post, once the conflict has arisen, an a dispute solution mechanism.
One school of thought suggested that parties will either agree or not agree, whether there is third party assistance or not: “It takes two to tango”. Others felt that the Conflict Management Rules could be a useful tool to overcome deadlock at the contracting stage. My current thinking is that it might be best to combine the Conflict Management Rules with some kind of fall-back provision, but I am open to persuasion. Of course, having a fall-back provision partly defeats the purpose, but I would be reluctant to leave matters “in the air”.
As regards the various means of ADR, DIS has designed five different sets of rules. With the exception of the Mediation/Conciliation Rules, which came into force in 2002, the new rules were implemented in May and July 2010. The new rules are
The Mediation Rules provide a set of rules consistent with international mediation standards, and address in particular important points such as confidentiality of the process and suspension of limitation periods.
The Rules on Expertise and the Rules on Expert Determination are designed to deal with particular points in dispute prior to litigation or arbitration. The findings of an expert under the Rules on Expertise will not bind the parties, but will provide them with an indication of how an independent third party evaluates the situation. Under the Rules on Determination, on the other hand, the findings by the expert would bind the parties until such time that a court or arbitration panel reviews the findings of the expert. Both processes are suited for situations where time is of the essence, such as in major construction or engineering disputes, where the progress of the project would be based on the (interim) findings by the expert.
The Adjudication Rules are modelled on the adjucation process under English law, and provide a framework for dispute boards to be appointed in long-term project.
The DIS standard clauses to be included in the respective agreements can be found here.