Alternative dispute resolution (ADR) provides ways to resolve disputes without litigation. ADR is more cost-effective and faster than litigation, saving disputants time, money and emotional stress. The most common ADR techniques are arbitration and mediation.
Arbitration
In arbitrations the participants present the facts of the dispute to a neutral arbitrator, who makes a decision that may or may not be binding, depending on the pre-arbitration agreement of the parties.
Traditional arbitration. In traditional arbitrations the parties present their case to the arbitrator, who decides the issues, and may prepare a written document if the parties desire. This decision is legally binding.
Non-binding arbitration. In non-binding arbitrations the same process determines the relative merits of each party’s position and the strength of their case, yet the parties do not need to accept the decision of the arbitrator. Many people use this kind of ADR to help in settlement discussions before trial.
High-low arbitration. In high-low arbitrations the parties agree in advance on the highest and lowest dollar amount that the party at fault will pay. They do not share these figures with the arbitrator. If the arbitrator decides on a sum that is lower than the low or higher than the high, the party who loses the decision pays the amount agreed upon in advance.
Baseball arbitration. This form of arbitration gets its name from major league baseball, where parties exchange their final and best offers but do not tell the arbitrator. After they present evidence to the arbitrator, they reveal their offers to the arbitrator, who chooses one number or the other. This system encourages the parties to make reasonable and realistic demands from the outset.
Mediation
In mediation the participants, with the assistance of the mediator, design a resolution for the conflict.
Generally mediation contains five phases, which can take place in one or several sessions.
Prior to the mediation the participants submit documents that concisely present the facts of the dispute and what is at stake.
The mediator introduces the process, indicating the ground rules, role of the participants, confidential nature of the proceedings and a review of the facts disclosed so far. The participants then explain the issues orally.
The mediator gathers information by asking about the nature and extent of the issues.
Both the mediator and the participants generate ideas for resolving the matter. Often the mediator meets separately with each party (we call that a caucus) to explore options confidentially.
Through negotiation the participants reach an agreement, which the mediator may or may not record in a written memorandum.
Even if the mediation does not resolve all the issues, mediation affords the opportunity to narrow the issues for further settlement discussions or litigation.
The Alternative Dispute Resolution (ADR) Process
Alternative dispute resolution (ADR) provides ways to resolve disputes without litigation. ADR is more cost-effective and faster than litigation, saving disputants time, money and emotional stress. The most common ADR techniques are arbitration and mediation.
Arbitration
In arbitrations the participants present the facts of the dispute to a neutral arbitrator, who makes a decision that may or may not be binding, depending on the pre-arbitration agreement of the parties.
Mediation
In mediation the participants, with the assistance of the mediator, design a resolution for the conflict.
Generally mediation contains five phases, which can take place in one or several sessions.
Even if the mediation does not resolve all the issues, mediation affords the opportunity to narrow the issues for further settlement discussions or litigation.