What is Alternative Dispute Resolution? A Complete Guide

What is Alternative Dispute Resolution (ADR)?

ADR (alternative dispute resolution) is a method of resolving disputes without litigation. Any process or conflict resolution technique outside of any federal government authority is considered alternative dispute resolution. There are four main types of ADR: mediation, arbitration, negotiation, conciliation, and transaction.

Types of ADR

Arbitration:

Arbitration involves a neutral person who listens to arguments and evidence from both sides and then determines the outcome. In arbitration, the evidence rules are often more relaxed than in a court trial. The arbitrator's decision is generally final, and the parties agree that they cannot appeal it. In non-binding arbitration, a trial can be requested if the parties disagree with the arbitrator's decision.

There are several types of arbitration: 

• National arbitration: state-governed arbitration, for instance, American arbitration, French arbitration, or German arbitration, which all follow their own rules.
   
• International commercial arbitration: often used to settle disputes arising between buyers and sellers located in different countries.
  
  
• Investor-State arbitration: a unilateral request for arbitration from an investor against the country where they have invested.

The arbitration clause of ADR may also be specialized in construction disputes, post-mergers and acquisition disputes, etc.

Collaborative Law:

The formal process of resolving disputes between separated couples without the stress, delays, and expenses of traditional litigation. The three principles of collaborative law are as follows:

1. The pledge not to bring disputes to court;
2. Information exchanged in good faith, freely, promptly, and without formal discovery; and
3. It is a commitment to pursue solutions that satisfy both parties and their children's highest priorities. It is important to remember that each lawyer diligently represents their client and not the other party's attorney, despite their commitment to collaborative law principles.

Mediation:

A mediator facilitates the settlement by helping the disputing parties agree. Mediators do not resolve disputes, but only facilitate communication between the parties so that they can try to resolve the dispute themselves. The mediation process may be beneficial when families, neighbors, or business partners disagree. Mediation may not be appropriate if one party holds great power or control over the other.

Neutral Evaluation:

A neutral subject-matter expert listens to abbreviated arguments. They examine the strengths and weaknesses of every side's arguments and assess the likely outcomes of the case. Parties may also use a neutral evaluator for settlement negotiations with their consent.

Negotiation

The most effective way to resolve disputes is through negotiation. In most cases, parties resolve disputes through negotiation rather than mediation and arbitration process. When the parties meet to negotiate a dispute, they are able to fix it. The main advantage of this method of dispute settlement is the ability to control the process by the parties themselves. It allows for a lot more flexibility than other forms of ADR and is less formal.

Parenting Coordination (PC):

"Parenting coordination" involves a qualified mental health or legal professional assisting high-conflict parents in implementing their parenting plan. If both parties and the court agree, the parenting coordinator can make decisions within the parameters of the court order or appointment contract. Among its purposes is to help parents resolve disputes regarding their children on time and to encourage healthy, safe, and meaningful relationships between them and their children.

Restorative Justice:

the process involves stakeholders identifying and addressing the impact, needs, and obligations and creating an action plan to address harm or other disputes.

Settlement Conferencing:

A judge or a judge's representative attends settlement conferences to try to resolve some or all issues before the case goes to trial. The dispute only involves a few parties, and the objective is to narrow it.

Special Master:

Neutrals are appointed by courts to carry out certain actions for them. Often, this includes overseeing discovery issues, scheduling conferences, or watching post-judgment proceedings.

Summary Jury Trials (SJT): 

An adversarial dispute resolution process involves each side presenting its case to a jury in a shortened form. The jury then makes an advisory decision unless there is a request for a binding decision. Summary jury trials give parties a glimpse of what a trial verdict could look like in cases that go to trial. The availability of SJTs is currently limited to a few jurisdictions.

Which disputes can be settled by alternative dispute resolution?

ADR processes can be used in hundreds of civil disputes involving individuals and organizations. Disputes may be based on topics such as:

• Family and divorce: ADR methods such as mediation and collaborative law can be used to resolve disputes related to child custody, alimony, property division, and other issues related to divorce.
  
  
• Housing: ADR methods such as mediation and arbitration can be used to resolve disputes related to landlord-tenant issues, including rent increases, maintenance issues, and eviction.
  
  
• Neighborhood: ADR methods such as mediation and community dispute resolution can be used to resolve disputes between neighbors, such as disputes over property boundaries, noise, or other issues.
  
  
• Environment: ADR methods such as mediation and collaborative governance can be used to resolve disputes related to environmental issues, such as pollution or land use.
  
  
• Employment: ADR methods such as mediation, arbitration, and workplace ombudsmen can be used to resolve disputes related to employment, including disputes over wages, benefits, and workplace harassment.
  
  
• Business: ADR methods such as mediation and arbitration can resolve business disputes related to contracts, partnerships, and other issues.
  
  
• Consumer issues: ADR methods such as mediation and consumer dispute resolution programs can be used to resolve consumer disputes related to issues, such as disputes over product quality or service.
  
  
• Personal injury: ADR methods such as mediation and arbitration can be used to resolve disputes related to personal injuries, such as disputes over compensation for injuries suffered in an accident.

As part of alternative dispute resolution, some countries also use it in cases involving juveniles.

Benefits Of Using Alternative Dispute Resolution

It depends on the type of ADR process and the particular circumstances of the case, whether ADR may prove beneficial. These are some of the potential benefits of alternative dispute resolution.

Save Time

Disputes can be resolved through alternative dispute resolution much quicker than through a lawsuit, which can take years to complete.

Save Money

Parties who resolve disputes through alternative dispute resolution may save some money they would have otherwise spent on attorney fees, court costs, and expert fees.

Increase control over the outcome and the process

It is typical for ADR to give parties more control over the process and the dispute outcome. In general, ADR processes give parties more opportunity to present their case than courtroom trials. It is possible to come up with creative resolutions in some ADR methods, such as mediation, that are not possible in a trial. The parties can choose an expert in a certain field to decide disputes in other ADR processes, such as arbitration.

Increase Control Over the Process and the Outcome

ADR is generally a process with greater control over both the process and the outcome. Parties can express their views more quickly in an ADR process than in a courtroom. ADR processes, such as mediation, enable the parties to reach creative solutions that would not be feasible during a trial. The parties can also elect an expert in a particular field to resolve disputes through other ADR processes, such as arbitration.

Preserve relationships

Disputes can be resolved quickly through ADR, which is less adversarial and hostile. An effective mediator can aid the parties in communicating their needs and perspectives. Parties can take advantage of this when their relationships need to be preserved.

Increase Satisfaction

A trial usually results in one winner and one loser. A loser won't be satisfied with the outcome, and even a winner will be only partially happy. ADR can assist parties in finding win-win solutions and achieving their goals in a real-world setting. As well as providing benefits to both parties, ADR could also improve their overall satisfaction with the dispute resolution process and outcome.

Improve Attorney-Client Relationships

Through ADR, attorneys can encourage their clients to see themselves as problem solvers instead of combatants. Clients will be happier receiving fast, inexpensive, and satisfying resolutions. They will continue to purchase from you and refer you to their friends and colleagues.

Reasons for Using ADR Include:

• It opens lines of communication
• Resolves conflict without formal complaint activity
• Promotes organizational effectiveness
• Faster return to productive activities due to reduced processing time
• Facilitates active participation of parties in the resolution process
• Provides confidentiality
• The right to pursue a formal EEO dispute remains intact
• Promoting equal opportunity and achieving justice.
  
  

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What happens if ADR is ineffective?

You may need to consider adjudication if ADR fails to resolve your dispute. A court adjudicative process involves your claim being heard by a judge.

There are several types of courts in which you can file a claim, depending on the type of dispute:

• County Court
• Tribunal System
• High Court
• Supreme Court
• Court of Appeal
  
  

To effectively manage your case and appear in court, it is recommended that you consult a litigation solicitor before considering the adjudicative process.

Things to know about ADR services

An ADR practitioner's hourly rate is usually based on their experience as an ADR specialist, the governing law and complexity of the dispute, and the region where they practice. Any other service can be negotiated with an ADR practitioner hourly or under a lump sum agreement. 

As part of the preparation, the following issues must be addressed:

• Having a good understanding of the process to be followed;
• Identifying your rights, responsibilities, and needs;
• Prepare a statement to introduce yourself;
• In addition to providing legal advice, the court will consider the potential wrong, best, and alternative outcomes.
• Are-Looking for alternative ways to reach your goals?
• Assessing how the other party will react and what expectations they may have, and eliminating their objections or concerns.
• Prepare yourself for mediation by being open-minded and willing to compromise and negotiate.
  
  

Complex disputes generally involve a meeting before the mediation session, which assists the parties and establishes a schedule for exchanging documents. The parties must sign a mediation or arbitration agreement before proceeding.

Useful Read: Settlement Agreement: Navigating the Complexities in HR

Parties to mediation or arbitrations must provide their cases succinctly and clearly. Embrace the other side, as a court trial may mean no other negotiating opportunities. Ensure you comply with the mediator or arbitrator's directions and look for options that benefit both sides. Make sure you are willing to cooperate and prepared to agree. 

ADR processes use private meetings for several reasons. There are several benefits to this, including a chance for the parties to take a break from tension and the chance for each party to provide confidential information. A private meeting can occur at any point during the process, and more than one may occur. Everyone present is allowed to request a private meeting. One party often asks for private meetings, but they are a typical element of negotiation.