Alternative Dispute Resolution is an alternative to litigation in which the parties at odds agree to be bound by the decision of an independent and impartial third party. ADR conferences take place because it encourages parties to settle their dispute without going to trial. ADR is usually less formal, less expensive, and less time-consuming than taking the case to trial.
Why Select Alternative Dispute Resolution?
Alternative Dispute Resolution is often much quicker and more cost-effective. It is offered for many different kinds of cases like civil lawsuits. Alternative Dispute Resolution clauses are common in employment contracts because it often saves companies money and bad publicity. Construction, employment, contract, securities regulation, and business disputes are also common examples of cases that use alternative dispute resolution.
ADR is also less expensive, less time consuming, and less formal than trial. ADR may be effective for both parties if they want to informally come to a settlement or outcome without going through a court proceeding.
Are There Different Kinds of Alternative Dispute Resolution?
Arbitration and Mediation are the two most common types of Alternative Dispute Resolution, although negotiation and collaborative law are also widespread. While there are differences between the types of alternative dispute resolution, all share the common goal of avoiding a court trial.
- Mediation: In mediation, there is always a mediator that helps the parties reach a mutual agreement to the dispute. The mediator is not a decision maker in the process. Instead, the mediator assists the parties in communicating with one another to settle the dispute without going to trial. Mediations are useful when parties want to preserve their relationship.
- Arbitration: Arbitrations have a neutral person called a "arbitrator" who hears the arguments and looks at the evidence of each side and then decides the outcome of the dispute. Arbitration is less formal than a trial and does not follow the formal court rules of evidence.
- Neutral Evaluation: In a neutral evaluation, each party presents their case to an evaluator who is a neutral party. After hearing each side’s case, the evaluator then gives an opinion on strengths and weakness of each party’s case, evidence, and arguments. The evaluator that is presented with the case is usually very experienced in the subject matter at hand.
Can an Alternative Dispute Resolution Be Overturned?
If an agreement is not reached between the two parties then it will go to trial. Since the 1956 Uniform Arbitration Act and revisions in 2000, arbitration agreements and awards are generally enforceable under state and federal laws if an agreement is reached. "Binding arbitration" means that the parties waive their rights to trial and the arbitrator’s decision is final. "Nonbinding arbitration" means that the decision of the arbitrator is not final and the parties can request to go to trial.
Should I Hire a Lawyer?
A reputable business lawyer can advise you on your options and the best course of legal action helping you to take into account other contingencies with which you may not otherwise be familiar.