UK court upholds “friendly discussion” as valid ADR

A justice of the UK High Court recently held that “friendly discussion” is a legitimate form of alternative dispute resolution. The parties had a contract requiring them to “first seek to resolve [a] dispute or claim by friendly discussion”; if it was unsuccessful, they would move to binding arbitration. Asked to rule on whether the clause was valid, Teare J said: “There is obvious commercial sense in such a dispute resolution clause. Arbitration can be expensive and time consuming. It is far better if it can be avoided by friendly discussions to resolve a claim. …[T]here is a public interest in giving effect to dispute resolution clauses which require the parties to seek to resolve disputes before engaging in arbitration or litigation.” The NSW Court of Appeal has previously found that an agreement to undertake genuine and good faith negotiations” to resolve disputes was valid.

Uni fee changes to hit law students; face possible challenge

The cost of becoming a lawyer is likely to dramatically increase under the Commonwealth budget’s deregulation of university fees. An advisor to the Abbott Government on higher education, Andrew Norton, predicts that fees will almost quadruple to equal the price charged to international students: “This would see annual fees for a law degree rise, on average, from $9792 a year to $37,831 a year.” While other estimates are lower, they nevertheless predict that “we can expect fees to rise more steeply in degrees with high private benefits and strong international demand, such as law”. The increased fees will mean law students are in debt for much longer: “The payback period for a four year professional degree such as Law will stretch from 14 years now to 20 to 25 years, depending on which university you choose.” Students will also be required to pay a higher rate of interest over the life of the debt. However, some of the plans might not be easily implemented. The government says the new interest arrangements will apply retrospectively to former students, but Monash law professor Justin Malbon questions whether that would be legal: “At its heart there’s an arguable case that it is a contract, and there’s an arguable case that taking into account the terms of the original legislation that they cannot later come along and unilaterally vary the contract to add in terms that never existed in the first place.”