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Service Agreement Information Kit for Funded Organisations

3.11 Dispute resolution

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Where a dispute arises, the organisation and department should seek to resolve the dispute through open and good faith discussions in the first instance. The organisation and the department are to act reasonably in these discussions.

All Australian governments have a common law responsibility to act as model litigants. Victoria has its own Model Litigant Guidelines. They set standards for how the state should behave as a party to legal proceedings. These guidelines are available on the Department of Justice and Regulation’s web page ‘Victorian Model Litigant Guidelines’ (external link, opens in a new window).

If a dispute is unable to be resolved through good faith discussions, the dispute can be referred to the dispute resolution process in clause 11 at any time during the term of the Service Agreement regarding any aspect of the Service Agreement. If the department and the organisation agree, the parties can also choose to mediate earlier than provided for under the dispute resolution process. The process is as follows:

Step 1

The party claiming that the dispute has arisen will give written notice to the other party, describing in full the details of the dispute (the “First Notice”).

Step 2

Within fourteen days of receiving the First Notice, the parties will meet to discuss and try to resolve the dispute.

Step 3

If the dispute remains unresolved twenty one days after receipt of the First Notice, then either party may give written notice (the “Second Notice”) to the other party requesting that the dispute be referred to the Dispute Resolution Officer for resolution.

Note: The Dispute Resolution Officer will normally be a Deputy Secretary or Director of the department who is not ordinarily involved directly in managing the Service Agreement under which the dispute has arisen.

Step 4

Within fourteen days of receiving the Second Notice, the parties will either meet with the Dispute Resolution Officer to discuss the dispute or provide written submissions regarding the dispute.

Step 5

Within twenty eight days of receiving the Second Notice, the Dispute Resolution Officer will provide their decision to the parties in writing.

Step 6

Within fourteen (14) days from the date the Dispute Resolution Officer provides their decision in writing, either party may provide written notice to the other party referring the dispute to mediation (the "Mediation Notice").

Step 7

Within fourteen (14) days of receiving the Mediation Notice, the party that received the Mediation Notice will provide written notice to the other party as to whether or not it agrees to mediate. Failure to provide this notice will not be deemed agreement to mediate.

Step 8

If neither party provides a Mediation Notice to the other, or if the party served with the Mediation Notice does not agree to mediate to resolve the dispute, then any decision of the Dispute Resolution Officer above will be final and binding on the parties.

Step 9

If the party served with the Mediation Notice agrees to mediate then the parties will mediate to resolve the dispute on the following terms:

  • a mediator may be appointed either by agreement between the parties or, failing such agreement within seven (7) days of the date of the Mediation Notice, by the president of the Law Institute of Victoria
  • each party will share equally the costs of the mediation including the mediator's fee, fees for mediation rooms and costs of shared equipment facilities and services of the mediation
  • the venue for the mediation will be agreed between the parties or, failing such agreement, will be nominated by the mediator
  • each party may be legally represented if they so wish
  • the mediation will be conducted without prejudice and complete confidentiality will be preserved in respect of the mediation and any documents and information used at or in relation to the mediation
  • if the dispute is still unresolved within twenty eight days after the date of the Mediation Notice (or after such other period of time agreed by the parties), the parties agree that the Dispute Resolution Officer will provide a new decision in writing (which may be the same as the decision made by the Dispute Resolution Officer in Step 5 before the mediation process commenced) and such decision will be final and binding on the parties.

During the dispute resolution process, the parties will continue to perform their obligations under the Service Agreement despite the existence of any dispute. Nothing in the Dispute Resolution clause (clause 11) affects the parties' abilities to exercise their rights under the Suspension clause (clause 12), Cessation clause (clause 13) and Termination of Agreement clause (clause 14).