Dispute resolution or dispute settlement is the process of sorting out disputes between two disagreeing parties without going to court. Also called “conflict resolution,” dispute resolution and conflict resolution are technically not the same. That’s because conflict is much deeper and lengthier than a dispute in legal parlance. Dispute resolution involves using numerous methods to solve various kinds of disputes. This includes family disputes, workplace disputes, business disputes, consumer disputes, environmental disputes, and housing disputes to name a few.
What Is ADR?
ADR stands for Alternative Dispute Resolution and its primary aim is to avoid litigation as much as possible. Thus it makes the disputing parties agree on an out-of-court settlement to reduce litigation costs. In recent years, ADR has become a common tool to resolve disputes alongside the legal system without going for a trial.
Despite the historic opposition to ADR, it has gradually become one of the most sought after tools of dispute resolution. This popularity rise is among both practitioners of the legal profession and the general public. One could say that this popularity is because of the versatility in the techniques in ADR.
The Forms Of ADR
ADR has many categories but is commonly put into four major types, i.e, negotiation, mediation, arbitration, and collaborative law. Many often regard conciliation as a fifth form. However, we can consider it as another form of mediation for the sake of simplicity.
Negotiation, as the name suggests, is a form of ADR where two disputing parties voluntarily negotiate with each other to mutually agree on a compromise without the involvement of any third-party mediator or arbitrator. However, attorneys hired by either party may represent their respective parties during a negotiation.
The next most common form of ADR is mediation. In this form of ADR, a third party, known as a mediator, facilitates the dispute resolution process between the warring parties. A mediator may even propose a resolution, known as the “mediator’s proposal”, to the parties involved but cannot impose the suggested proposal on either party. Mediation is fully confidential and non-binding.
Arbitration, like negotiation, is a voluntary process. It has a neutral third party, just like in mediation to resolve a dispute. However, unlike a mediator who can only propose but not impose a resolution, an arbitrator acts as a judge. He can impose a resolution after hearing out both sides. Arbitration is cheaper than litigation but costlier than mediation.
Collaborative Law also popular as collaborative divorce and it is a process of ADR. In this, each party hires attorneys to assist in the process of separation within specific terms and conditions. There is no imposition of any resolution on the parties in this form of ADR. Thus they can reach an agreement with the help and guidance of attorneys or legal experts.
Advantages and Disadvantages of ADR
The cardinal objectives of ADR is to save the time and money of the disputing parties. They do this by convincing the disputing parties to settle out of court for a better deal. Since litigation costs are constantly rising, ADR has become a suitable option for everyone. The advantages of ADR are many. First off, it’s appropriate for multi-party disputes. Also, it’s cheaper than litigation. Some consumer cases may even be free. Faster and favorable settlements are highly likely in ADR, which is particularly a flexible process. On top of it, it’s confidential and non-obligatory.
However, ADR does come with a few flaws, that make people question if it is a better alternative to litigation. For example, there is always a possibility of a power imbalance. It is not effective against quasi-criminal allegations and can sometimes cost as much as litigation.
ADR is a favored process of many legal practitioners and the American Bar Association even advises ADR as the first step to dispute resolution before going to a trial. The recent surge in popularity of ADR is probably because of the increasing number of pending cases in traditional courts. A general impression that ADR is much cheaper than litigation, the demand for confidentiality, and the flexibility in choices that ADR offers. American courts have been recommending ADR since the 1990s and since then it has become the most viable alternative to litigation.