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The source of Alternative Dispute Resolution information, resources and expertise in Alberta Alberta’s professional association of mediators, arbitrators and other ADR practitioners

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The Illusion of Control: Why Overly Complex ADR Clauses Can Backfire 

Last Updated: May 20, 2025

A results-oriented Contract Management leader with 10+ years of experience across the full contract lifecycle—drafting, strategic management, and practical application—in sectors including mining, energy, finance, and technology. Joánri has handled agreements from daily operational needs to complex, multi-year master contracts exceeding a billion dollars. Now, she applies this expertise to guide individuals and businesses through contract disputes, optimization, and implementation.

While the intention behind including an Alternative Dispute Resolution (ADR) clause in commercial contracts is often to provide a clear and efficient route for resolving disagreements outside of the traditional courtroom, the desire for absolute certainty can sometimes lead to overly complex clauses that ultimately undermine this very aim. 

The initial appeal of a highly detailed, almost court-like ADR process is understandable. It offers a perceived sense of control and predictability by meticulously outlining each step. However, this approach can often inadvertently create a ‘court process by another name’, replicating the very complexities and potential delays that ADR is intended to avoid. 

The Pitfalls of Overly Prescriptive ADR Clauses 

  • Disputes as Part of the Agreement Lifecycle: 
    • When the primary focus shifts to meticulously adhering to every procedural detail of an overly complex clause, the actual substance of the dispute can become secondary. Parties may become more concerned with ‘ticking the boxes’ of the process than with actively seeking a mutually acceptable and pragmatic resolution, thereby undermining the fundamental purpose of ADR. 
    • Overly rigid timelines can create procedural breaches due to practical challenges in gathering information or agreeing on a neutral. 
    • Disputes rarely unfold in a predictable manner. Overly detailed clauses often lack the necessary flexibility to adapt to the specific and evolving circumstances of a particular disagreement. Rigid procedural steps can also limit the arbitrator or mediator’s ability to guide the process effectively and tailor it to the specific needs of the dispute. In other words – neither the parties’ purpose, not the arbitrator or mediator function, is enabled. 
  • Increased Costs: 
    • Mandating specific and/ or external technical experts at various stages, even in straightforward disputes, can significantly inflate costs and make the ADR process disproportionately expensive. 
    • Overly prescriptive provisions relating to the arbitrator themself, especially those specifying highly niche expertise or requiring a panel of multiple arbitrators, can further increase costs. Finding individuals who meet these specific criteria within the stipulated timelines can become exceedingly difficult and costly, leading to further delays and frustration for the parties. 

In instances where these clauses are used and many of the challenges above are applicable, it may even frustrate the intention of the clause altogether and make the described dispute resolution clause functionally ineffective. Pretty to look at certainly, but useless in practice. 

The Benefits of Dispute-Responsive Clauses: 

In contrast to these overly prescriptive approaches, dispute-responsive clauses, such as a progressive dispute resolution clause, offer a more pragmatic and adaptable framework that provides the flexibility for the parties to agree on the specific dispute and mediation and/ or arbitration process for it. This allows for: 

  • Flexibility and Adaptability: Tailoring the process to the specific needs of the dispute and available mediators or arbitrators, leading to more efficient and cost-effective resolutions. 
  • Focus on Substance: Keeping the attention on the actual issues in dispute and encouraging parties to work towards a resolution, rather than being bogged down trying to check procedural boxes. 
  • Reduced Costs: Avoiding unnecessary steps and the involvement of excessive personnel. 
  • Greater Efficiency: Allowing parties to move through the process more quickly and reach a resolution sooner. 

Conclusion: 

While a desire for absolute certainty and control when drafting ADR clauses is understandable, overly complex and prescriptive approaches can often backfire and make the process unusable. Dispute-responsive clauses, which prioritise flexibility for both the parties and an arbitrator or mediator and the ability to tailor the process to the specific needs of the dispute, are often far more effective in achieving the core goals of ADR: efficient, cost-effective, and mutually acceptable resolutions that help preserve valuable business relationships. 

Disclaimer: This article offers general commentary and suggestions for consideration by ADR practitioners. It is not intended as a substitute for professional legal advice, and practitioners are responsible for exercising their own professional judgment and seeking specific legal guidance when advising clients or drafting legal documents. 

The Illusion of Control: Why Overly Complex ADR Clauses Can Backfire Read More

Category: Blog

Building Resilience into Agreements: The Power and Nuances of Progressive Dispute Resolution 

Last Updated: May 20, 2025

A results-oriented Contract Management leader with 10+ years of experience across the full contract lifecycle—drafting, strategic management, and practical application—in sectors including mining, energy, finance, and technology. Joánri has handled agreements from daily operational needs to complex, multi-year master contracts exceeding a billion dollars. Now, she applies this expertise to guide individuals and businesses through contract disputes, optimization, and implementation.

Contracts form the basis of commercial interaction, setting out the framework for collaboration and mutual benefit. However, even with careful planning, disagreements are a natural part of doing business. The real strength of a solid agreement lies not in avoiding disputes altogether, but in having effective ways to deal with them constructively. 

Progressive dispute resolution clauses offer just that – a structured, step-by-step approach to resolving conflicts that can encourage communication, maintain relationships, and ultimately lead to more efficient and mutually beneficial results. This structured approach recognises that not all disagreements require the same level of intervention, often allowing minor issues to be resolved quickly through initial, informal discussions at the appropriate technical level. 

The Multi-Layered Benefits of a Progressive Approach 

Benefits for the Contracting Parties: 

  • Disputes as Part of the Agreement Lifecycle: 

By acknowledging that disagreements are a natural part of the contract lifecycle and requiring initial discussions between appropriate personnel, progressive clauses prioritise direct communication and stop small disputes from becoming very big disputes unnecessarily. By requiring technical staff from the area in dispute to engage first, it can also foster a deeper understanding of the other party’s perspective and can lead to early, mutually agreeable solutions for emerging issues. 

  • Strategic Escalation with Enhanced Knowledge: 

As disputes progress through defined stages, they involve individuals with increasing authority and a broader business understanding. This enables well-informed decisions as each escalation point decision-maker has the benefit of the information and outcomes gathered in the step before as well as their own knowledge and experience. 

  • Preserving the Foundation of Relationships: 

By prioritising early-stage discussions and mediation, progressive clauses are designed to safeguard the ongoing relationship between the parties, particularly crucial in long-term collaborations where mutual trust is essential. The initial focus is on problem-solving rather than adversarial positions. 

This approach can also support success during the contract lifecycle where the parties may have experienced turnover of key staff or teams. In those instances, past relationships and understanding of the agreements and applicable processes may have been lost in the shuffle, and by requiring the parties to re-engage progressively, what was lost can start to be rebuilt. 

  • Unlocking Creative and Tailored Solutions: 

The staged approach often leads to a more nuanced and in-depth understanding of the underlying issues for all parties. This deeper insight can pave the way for creative, tailored, and mutually beneficial solutions that might not surface in a more confrontational environment. 

Benefits for the ADR Professional: 

  • Enhanced Information: 

By the time a dispute reaches mediation or arbitration, the parties will have already engaged in multiple rounds of discussion and negotiation. This thorough groundwork provides a much clearer technical understanding, understanding of the core issues for both the parties as well as the mediator or arbitrator, each party’s current position, and the potential broader impact of the dispute. 

  • Facilitating Focused and Productive Processes: 

The enhanced knowledge gained from the progressive steps allows mediators to conduct more focused and productive sessions. For arbitrators, it can significantly streamline the arbitration process by clarifying the points of contention and the history of attempts at resolution. 

  • Innovative Solutions: 

With the benefit of the progressive steps, the parties will also have been enabled to ‘test’ initial solutions to the current dispute and have a deeper understanding of why it may/ may not work. They may also then have more time to gain the benefit of the knowledge, experience, and insight of their technical staff to create more ‘creative’ and sustainable solutions. 

Tailoring the Clause: 
In contracting, as in life, a one-size-fits-all approach rarely works. Progressive clauses should be tailored to the specific needs of the contract and the industry involved. For example: 

  • Technology Agreements (SaaS, IaaS, Hardware, and Software Warranties etc.): 
    • Where the contract relates to very technical goods or services, including steps requiring technical experts to resolve issues related to performance or functionality initially can ensure they are addressed quickly and safely. 
    • Where these agreements require certain performance levels, the quick escalation of system failures, errors, breaches etc. allow technical leadership to identify recurring common problems and enable more comprehensive solutions to address those appropriately. 
  • Master Goods/ or Service Agreements (MGA, MGSA, MSA’s etc.): 
    • More complex agreements with multiple delivery lines and performance requirements for both parties may require more specific engagement points. In agreements like these, including a general progressive dispute resolution clause in the General Terms and then adding in and/ or specifying specific technical steps (and team member names, contact details etc.) within an applicable schedule will ensure that the overall agreement has a common dispute resolution approach, while also ensuring that teams dealing with one particular schedule only, have a clear path to easily follow day to day. 

Practical Tips

When Drafting Effective Progressive Clauses: 

  • Clarity is Key: Use clear and unambiguous language to define each stage, the responsibilities of each party, and the timeframes involved with as little ‘jargon’ or ‘legalese’ as possible. The overall goal of the ADR clause is to enable the contract lifecycle by making disputes easy to address quickly and appropriately. The language further supports this by ensuring every team member who may need to use this process can easily understand and act within it. 
  • Define Roles: 
    • Specify the level of personnel required at each stage to ensure appropriate engagement. 
    • Where there may be a delegation of authority that applies, use the common titles of the positions the necessary delegation is with. 
    • This will likely be a clause used by both operational and technical staff members so ensure every team member that may need to use this process can easily understand and act within it. 
  • Set Realistic Timelines: Balance the need for thorough discussion with the urgency of resolving the dispute. 
  • Include a “Safety Valve”: Consider including a provision that allows parties to bypass certain stages in exceptional (and defined) circumstances, such as when there is a risk of immediate harm or a material technical failure. 

When mediating or adjudicating disputes with progressive clauses: 

  • Follow the checklist 
    • For mediators and arbitrators, a progressive clause provides an initial roadmap for engaging with the parties around the dispute. From the clause, you know what steps each was required to be taken and what information the parties will likely have needed at those stages prior to moving to the next step. 
  • Streamlining the matters in disputes 
    • By initially confirming that each party followed the progressive process and confirming their understanding of the facts and outcome at the end of each step, each party can reflect on that step for themselves as well as the other party without additional probing questions from you. 
    • It may be possible to also confirm the commonly accepted ‘technical facts’. E.g. the jurisdiction, the technical specifications of a particular equipment piece etc. 
    • You also have the benefit of a clearer picture of what is in dispute, as well as where and how previous resolutions failed. 

Conclusion: 

Progressive dispute resolution clauses offer a practical and effective way to manage the inevitable disagreements within contracts. By building in a structured process for addressing disputes, these clauses encourage communication, maintain relationships, and often lead to more efficient and mutually beneficial results. For mediators and arbitrators, understanding the details of drafting and implementing these clauses is essential. A well-crafted progressive clause not only builds resilience into agreements but also provides a practical and constructive way to resolve conflicts, ultimately contributing to stronger and more sustainable business relationships. 

Sample Clause: 
Dispute Resolution:

Any dispute arising hereunder, including the validity of this agreement, shall first be resolved by taking the following steps, where a successive step is taken if the issue is not resolved at the preceding step: 1. by the technical and/ or contractual personnel for each Party, 2. by the technical and contractual managers for each Party, 3. by executive management of each Party, 4. by mediation, or 5. through binding arbitration and/ or the applicable court. 

Except as otherwise provided herein, each party shall be responsible for its own legal costs and attorneys’ fees. 

This article shall survive the termination of this Agreement for any reason. 

Disclaimer: This article offers general commentary and suggestions for consideration by ADR practitioners. It is not intended as a substitute for professional legal advice, and practitioners are responsible for exercising their own professional judgment and seeking specific legal guidance when advising clients or drafting legal documents. 

Building Resilience into Agreements: The Power and Nuances of Progressive Dispute Resolution Read More

Category: Blog

The Silent Killer: Why “Validity” Matters in Your ADR Clause

Last Updated: May 6, 2025

A results-oriented Contract Management leader with 10+ years of experience across the full contract lifecycle—drafting, strategic management, and practical application—in sectors including mining, energy, finance, and technology. Joánri has handled agreements from daily operational needs to complex, multi-year master contracts exceeding a billion dollars. Now, she applies this expertise to guide individuals and businesses through contract disputes, optimization, and implementation.

In any contract lifecycle, disputes are inevitable. Alternative Dispute Resolution (ADR) clauses, promising cost-efficiency, confidentiality, and a solution outside the traditional courtroom, are often tucked away in the latter part of the contract or General Terms as a boilerplate clause meant to provide a framework for resolving those disagreements. 

But what happens when the foundation the ADR clause rests on – the contract’s validity – is called into question? This is where the often-overlooked word “validity,” or the phrase “and validity thereof,” becomes critically important.

Imagine a scenario where a disagreement arises, and one party claims the entire contract is invalid due to issues with its formation, perhaps alleging misrepresentation, or lack of capacity by a signatory, etc. If the ADR clause doesn’t explicitly address disputes concerning the validity of the contract itself, you could find yourself in a precarious situation as an arbitrator. 

Here’s why this seemingly small detail can have a significant impact: 

The Four Walls of the Contract: Contractual dispute resolution, especially arbitration, operates within the confines of the contract that created it. The arbitrator’s appointment, authority to adjudicate the dispute, have their award be enforceable within that contract, by that same token, is also typically derived from the contract between the parties. 

If the contract creating that process is then found to have been invalid, the basis for arbitration becomes equally invalid. 

Note that this will only be applicable where the contract is found to have never been valid – not where the contract was initially valid and then became, or is found to have become, invalid thereafter. 

The Arbitration Paradox: Consider the irony: a party arguing that the contract is invalid might also be required to participate in an arbitration process outlined within that very contract. Without a clear provision addressing validity, courts may struggle with how to proceed. Does the arbitrator have the power to decide on the validity of the contract itself? Or does that question need to be resolved in court first, potentially undermining the efficiency goals of ADR? 

The Risk of Parallel Proceedings: The absence of “validity” in the ADR clause can also lead to a messy situation where one party initiates arbitration while the other party files a court action challenging the contract’s validity. This can result in costly and time-consuming parallel proceedings as the court will need to consider its own jurisdiction as well before hearing the case, defeating the purpose of having an ADR clause in the first place. 

So what now? 

Protect the dispute resolution mechanism 

  • Write it in at the start

Ensure certainty and clarity by including the phrase “and validity thereof” in your ADR clause acts as a safeguard. 

By clarifying this seemingly minor detail while drafting you can save significant time, money, and headaches down the road, ensuring that your chosen path to dispute resolution remains effective and reliable. 

  • Amend the contract prior to arbitration to include it

You may be engaged and on review of the contract and an overview of the matters in dispute, it becomes clear that those matters include something that can invalidate the contract, propose that the parties amend the ADR clause to include necessary language to ensure the clause will survive to enable adjudication. 

Conclusion 

Ultimately, putting the words “and validity thereof” in your ADR clause isn’t just legal jargon – it’s a practical step that makes good sense. By clearly stating that your chosen way to resolve disagreements also covers any arguments about whether the contract itself is valid, you can steer clear of confusing legal battles and the risk of ending up in both arbitration and court at the same time. This small addition makes sure your agreed-upon method for solving problems can actually do its job properly and efficiently, protecting the time and money you hoped to save in the first place. 

Sample Clause: 
Dispute Resolution: Any dispute, disagreement, or claim arising out of or relating to this Agreement, including the breach, termination, or validity thereof, shall be resolved by [Insert chosen ADR method, e.g., arbitration] in accordance with [Insert relevant rules, e.g., the rules of the International Chamber of Commerce]. The place of [ADR method] shall be [Insert location]. 

Disclaimer: This article offers general commentary and suggestions for consideration by ADR practitioners. It is not intended as a substitute for professional legal advice, and practitioners are responsible for exercising their own professional judgment and seeking specific legal guidance when advising clients or drafting legal documents. 

The Silent Killer: Why “Validity” Matters in Your ADR ClauseRead More

Category: Blog

ADRIA Board Director Opportunity!

Last Updated: May 6, 2025

Your Opportunity for Impact!

Looking to serve our membership in a way that advocates change and engages our community? We have initiated our annual Board Director recruitment process. If you are looking for an opportunity to guide strategic direction in ADR, start here – join our Board!

As a Director you would participate in monthly virtual Board meetings with additional in-person meetings 1-2 times per year. Additionally, you would be asked to serve on one of the two standing committees: Finance, Audit and Risk, or Governance and Human Resources. As well, there are several sector specific committees to engage your area of ADR expertise. We are a governance Board.

Directors are full members who bring a background in various sectors. If you are a lawyer,mediator, arbitrator, business owner, accountant, or you have a background in diversity, equity and inclusion, social work, and or lobbying, share your skills with us and share in our vision: Leading Dispute Resolution in Alberta.

We have a few Director vacancies, expressions of interest are invited to be submitted to Membership@adralberta.com and will be welcome until March 10, 2024. Virtual interviews will be held March 17 – 21, 2024 and Directors will complete the election process and participate in our AGM, scheduled for May 30, 2024.

ADRIA is an organization dedicated to promoting, delivering and improving justice and access to justice in Alberta. We have long valued and drawn strength from our diversity as leaders in this field. We strive to respect individuals based on their integrity, knowing we have much work to do. ADRIA is committed to speaking out against racism and discrimination in all its forms and to ensuring our commitment to diversity and inclusion is reflected in our training, policies, and operations. We are dedicated to working with ADRIC and our fellow regional affiliates, our members, clients, colleagues, and all others in the pursuit of justice, diversity and reconciliation.

ADRIA Board Director Opportunity!Read More

Category: Blog, Board

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The Illusion of Control: Why Overly Complex ADR Clauses Can Backfire 

Building Resilience into Agreements: The Power and Nuances of Progressive Dispute Resolution 

The Silent Killer: Why “Validity” Matters in Your ADR Clause

ADRIA Board Director Opportunity!

ADRIA Response to Family Justice Strategy

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