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Article ADR ( Alternative Dispute Resolution)

Article ADR ( Alternative Dispute Resolution)

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Published by: Anzr C Ctlobelii on Mar 29, 2011
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Alternative Dispute Resolution( ADR )
Alternative dispute resolution (ADR) is a process designed toresolve disputes without going to court. The two most common types of ADR are mediation and arbitration.Alternative dispute resolution (ADR) is an umbrella term embracingvarious processes principally designed to overcome some of the allegedweaknesses in litigation. For instance, ADR is generally cheaper, lessadversarial, and simpler than litigation, and ADR techniques offer agreater range of remedies than the courts. Contracts can be renegotiatedand settlements can include nonlegal concessions such as providing areference where there is an employment dispute. Moreover, ADR isgenerally speedier than litigation.First used extensively in the United States in the 1970s, ADR thenspread to other common law countries and is used in many situations; forinstance, where there are commercial, accounting, construction,employment, and family disputes. It ranges from morally (and sometimeslegally) binding decision making by a third party, such as arbitration, tononbinding processes such as mediation and conciliation. Theseprocesses, which are court annexed in some jurisdictions in somecountries, are described below. Arbitration is probably the oldest of ADRprocesses and can best be described as noncourt adjudication.Procedurally, an arbitration hearing is less formal than a court hearing; forexample, the former normally has no formal rules of evidence. Furthermore, arbitration is private unlike a court, and there is finality. Appealsfrom an arbitrator’s decision are severely limited, essentially to questionsof procedural fairness and the arbitrator’s conduct. Also, arbitration isgenerally speedier than litigation, and normally the parties choose thearbitrator as well as the time and place.Arbitration can take various forms. In the most common variant,the arbitrator chooses anywhere between the limits (offers) set by theparties. Alternatively, the arbitrator is restricted to opting for either oneparty’s final offer or the other party’s final offer, but nothing in between.This final offer arbitration is sometimes called flip flop arbitration. A third
 
variant is where the arbitrator makes a decision and then the offer of theparty closest to the arbitrator’s decision is the formal arbitration award.Mediation and conciliation and the terms are often used interchangeablyare becoming increasingly popular. Both mediation and conciliation arevoluntary, nonbinding, confidential, without prejudice, and withoutprecedent processes. Their aim is to assist people to talk to each other ina rational and problem-solving way and to bring realism and objectivity toa dispute. Whereas lawyers focus on rights, mediators/conciliators focuson interests and the needs of the parties and act as a catalyst to enablethe parties to communicate with each other and identify common ground,essentially assisting negotiation. Mediators and conciliators, however, varyin the extent to which their main aim is therapeutic or their main aim is toobtain a settlement and how interventionist they are. Some are mainlymessengers, shuttling back and forth with offers. Others not only seek topersuade the parties to settle by giving opinions on facts, law, andevidence but also make recommendations.Although arbitration, mediation, and conciliation are the mostcommon ADR processes, there are others including med-arb, ombudsmen,and mini trials. In the United States and South Africa, med-arb ispracticed: with the consent of the parties, the same person mediates and,if that is unsuccessful, then arbitrates. Ombudsmen, increasingly availablein the United Kingdom, deal with complaints from individuals about publicbodies and private sector services such as insurance, banking, andrentals. Once the organization has had an opportunity to deal with thecomplaint, the complainant can then go to the relevant ombudsman whowill investigate the matter and suggest a resolution. As with mediation,the ombudsman procedure does not prevent complainants from enteringanother ADR process or embarking on litigation. Mini trials are formalizedsettlement conferences where representatives of the disputants makeshort presentations and adjudicator(s) give a decision that, however, isnot binding on any party, unless or until they agree to settle.Although ADR has advantages compared with litigation, it also hasdisadvantages. First, because there are no precedents, the parties maynot be able to weigh accurately the strength of their case. Second,because ADR processes are private, there is no wider message, forinstance, about what practices can be viewed as discriminatory on
 
grounds of race or sex or the extent of the duty of care owed by theemployer to the worker. Third, a party might embark on conciliation ormediation to buy time, as a party can walk away without reaching asettlement at any time. Nevertheless, ADR is an attractive option forpeople who are unwilling to risk the complexity and financial reefs of litigation.Alternative dispute resolution (ADR) is a term that refers to severaldifferent methods of resolving disputes outside traditional legal andadministrative forums. These philosophically similar methodologies, whichinclude various types of arbitration and mediation, have surged inpopularity in recent years because companies and courts becameextremely frustrated over the expense, time, and emotional toll involvedin resolving disputes through the usual legal avenues. "The adversarialsystem is expensive, disruptive, and protracted. More significantly, by itsvery nature, it tends to drive the parties further apart, weakening theirrelationship, often irreparably" pointed out Whayne Hoagland in BusinessInsurance. ADR programs emerged as an alternative, litigation-freemethod of resolving business disputes.Analysts also trace the rise of ADR methods to changing attitudeswithin the American judicial system. Business Horizons contributorStephen L. Hayford observed that until the 1980s, "attempts by businessfirms to avoid litigation … were frustrated by a longstanding hostility onthe part of the courts toward any devices that infringed on theirjurisdiction." But during the 1980s, Hayford noted that a new body of caselaw emerged that sanctioned the use of binding arbitration provisions incommercial contracts between companies, business partners, employeesand employers, etc. This body of law continued to evolve in the late1990s. For example, the Alternative Dispute Resolution Act of 1998extended ADR mechanisms throughout the federal district court system.As Simeon Baum stated in CPA Journal, "the act recognizes that ADR,when properly accepted, practiced, and administered, can not only savetime and money and reduce court burdens, but also 'provide a variety of benefits, including greater satisfaction of the parties, innovative methodsof resolving disputes, and greater efficiency in achieving settlements.'"Today, legal and corporate acceptance of alternative disputeresolution as a legitimate remedy for addressing business disagreements

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