What is an Independent Dispute Resolution Scheme?
Carol Brady
Dispute Resolution often known as ADR (Alternative Dispute Resolution) refers to methods of resolving disputes without going to court and helps both parties avoid costly and lengthy legal proceedings.
ADR falls into two main categories:
- mediation – where an independent third party will help disputing parties come to a mutually acceptable outcome (such as during divorce proceedings)
- arbitration – where the independent third party considers the facts and takes a decision that is often binding on one or both parties.
The Code’s dispute resolution scheme is fully independent and run by award-winning dispute resolution experts, CEDR Ltd. Schemes such as our Independent Dispute Resolution Scheme (IDRS) and Ombudsman schemes are designed to give consumers access to free and impartial redress which is relatively simple and quick to resolve.
The Code itself applies to homes built under the insurance protection of one of the supporting Home Warranty Bodies:
- NHBC
- Premier Guarantee
- LABC Warranty
- Checkmate
Between them, the above bodies cover 95% of the new Homes built in the UK. Where issues are identified under the Code, Home Buyers can use the Code’s IDRS to pursue their complaint.
For example, a dispute may arise where a Home Buyer believes the Home Builder has failed to meet the Code’s Requirements but it falls outside the Home Warranty Body’s resolution scheme for defects or damage. The Home Buyer may apply to the Consumer Code’s IDRS and a trained Adjudicator will review written submissions from both parties before deciding whether or not the Home Buyer has a legitimate dispute. The Home Buyer and the Home Builder will have the opportunity to review the Adjudicator’s proposed Decision to correct any misunderstandings or fill any gaps in evidence. Once the Adjudicator has made their decision the consumer has 6 weeks to confirm whether or not they accept.
Under the rules of registration, the Home Warranty Bodies require each registered builder to honour any award made against them under the IDRS. If a Home Builder fails to honour an award, the Home Warranty Bodies can apply a number of sanctions including financial penalties, re-training or suspension/removal from the new Home Warranty Bodies’ registers.
Pursuing a complaint via our IDRS does not prevent you from taking legal action, should you choose to do so. Please be aware, however, that in some cases, if you accept the decision on your claim, you may not be able to proceed with any further legal action. Even in cases where you refuse to accept the award or decision made, any subsequent legal action is likely to take account of the outcome of your complaint.
In the UK, there are already several large and well-established ADR schemes in regulated sectors. According to the CTSI, £12.7 million has been recovered for consumers through the various ADR schemes in place since the introduction of the Alternative Dispute Regulations of 2015.
The Code is approved under the CTSI Consumer Codes Approval Scheme and having an ADR scheme is one of the requirements set by the CCAS in approving Codes to join the scheme. Our IDRS therefore forms an essential part of the work we do to support new Home Buyers.
If you believe a Home Builder has breached our Code, full details on how to make a complaint, including frequently asked questions, are available in our guide: https://consumercode.co.uk/wp-content/uploads/2020/02/CCHB-IDRS-FAQ-June-2019.pdf
Further reading:
Or watch our short video: https://consumercode.co.uk/what-is-an-independent-dispute-resolution-scheme/
