Types of dispute resolution clauses—ADR, multi-tier, hybrid and carve-out clauses
Types of dispute resolution clauses—ADR, multi-tier, hybrid and carve-out clauses

The following Dispute Resolution guidance note provides comprehensive and up to date legal information covering:

  • Types of dispute resolution clauses—ADR, multi-tier, hybrid and carve-out clauses
  • Mediation clauses
  • Multi-tier or escalation clauses
  • Hybrid clauses
  • Carve-out clauses

Brexit: The UK's departure from the EU on exit day ie Friday 31 January 2020 has implications for practitioners considering cross border issues (including some of those considered below). For guidance, see Cross border considerations—checklist.

Many contracts contain dispute resolution clauses which provide an alternative to a straightforward agreement to resolve any disputes that arise by litigation or arbitration. Parties have several options open to them (see list below), but it is important to understand the consequences of your drafting decisions. In this Practice Note, we consider some of the clause options available and assess some of the issues in relation to each type of clause.

The types of dispute resolution clause considered in this Practice Note are:

  1. mediation clauses

  2. multi-tier clauses

  3. hybrid clauses, and

  4. carve-out clauses

If court proceedings are commenced in breach of an enforceable dispute resolution agreement, the court has the discretion to stay the proceedings (Cable & Wireless v IBM at para [34] and Ohpen Operations UK v Invesco Fund Managers at para [32]). The court will take into consideration, when exercising its discretion, the public policy interest in upholding the parties’ agreement and furthering the overriding objective in assisting the parties to resolve their disputes (Ohpen at para [32] and see News Analysis: Construction and enforcement of multi-tiered dispute resolution clauses (Ohpen v Invesco)). For more information on