The agreement, struck between the Institute of Arbitrators & Mediators Australia (IAMA) and The Chartered Institute of Building (CIOB), was signed today by IAMA president Michael Kirby and CIOB president Li Shirong at a ceremony held at midday at the IAMA Dispute Resolution Centre in Sydney.

The initiative comes off the back of the Australian Government's recent significant investment in infrastructure. It is also in recognition of the fact that the construction sector is particularly prone to disputes, given the complex nature of projects and strict time frames for project completion.

This most recent agreement follows last week's signing of a memorandum of understanding between IAMA and the Arbitrators' and Mediators' Institute of New Zealand to promote ADR in the region.

Speaking to Lawyers Weekly recently, Kirby said he expected more cross-border ADR agreements to follow, explaining that ADR can be particularly useful in disputes involving both common law and civil law jurisdictions.

"It's often highly desirable that provisions should be made for arbitration and mediation of [such] disputes, simply because of the different legal rules, and for the identification of the law of the jurisdiction which is going to apply to the resolution of any dispute that arises," he said.

He said the economic downturn, and the rise in disputes as a result, has emphasised the value of ADR in two ways. "First, by providing ... confidential, out-of-court procedures that don't - by publicity - exacerbate difficulties facing the liquidity of companies which can add to the problems of the economic viability of companies," he said. "And secondly, by providing a more rapid and cost-effective method of dispute resolution, it can save monies that will otherwise be incurred in a lengthy, protracted and expensive litigation."

- Zoe Lyon