Alternative Dispute Resolution, or “ADR”, is an alternative to litigation. In ADR, the parties at odds agree to be bound by the decision of an independent and impartial third party. ADR conferences generally encourage parties to settle their dispute without going to trial. As a result, ADR is usually less formal, less expensive, and less time-consuming than taking the case to trial.
Alternative Dispute Resolution is often much quicker and more cost-effective than the full litigation process. It is offered for many different kinds of cases and civil lawsuits. Alternative Dispute Resolution clauses are common in employment contracts because it often saves companies money and bad publicity associated with lawsuits.
ADR can also be 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 formal court proceeding.
As mentioned, ADR is used in a variety of settings and to handle a wide range of legal disputes, issues, and claims. ADR is commonly used in:
- Family law disputes, including those involving divorce, child custody, child support, spousal support, and other matters;
- Various contract matters and claims;
- Stocks and securities regulation;
- Business disputes;
- Construction projects; and
- Various other topics.
There are many other applications of ADR procedures. These all depend on the parties’ needs and desires regarding the outcome of their legal issue.
Arbitration and Mediation are the two most common types of ADR. Negotiation and collaborative law are also widely used. While there are differences between the types of alternative dispute resolution, all of them generally share the common goal of avoiding a court trial.
Some different types of alternative dispute resolution include:
- Mediation: In mediation, there is always a third-party mediator that helps the parties reach a mutual agreement to the dispute. The mediator is not really a true decision maker in the process.
- Instead, the mediator helps 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 or working arrangement with one another.
- Arbitration: Arbitrations have a neutral person called an “arbitrator.” This is a person who hears the arguments and looks at the evidence of each side and then decides the outcome of the dispute or conflict. Arbitration is less formal than a trial and does not follow the formal court rules and procedures for evidence.
- Neutral Evaluation: In a neutral evaluation, each party presents their case to an evaluator who is once again a neutral party. After hearing each side’s case, the evaluator then gives an opinion on the different strengths and weaknesses of each party’s case, evidence, and arguments. The evaluator that is presented with the case is usually very experienced in the particular subject matter at hand.
- For instance, if the legal dispute involves a business matter, the evaluator will usually have education, training, and experience in the business realm.
State laws may vary with regards to each different type of alternative dispute resolution. In some cases, ADR may be prescribed or ordered by the court. For instance, in many divorce or other family law matters, the parties may need to undergo “court-ordered mediation” to help them resolve their disputes.
If an agreement is not or cannot be reached between the two parties then it will go to trial. Since the passage of the 1956 Uniform Arbitration Act and its revisions in 2000, arbitration agreements and awards are generally enforceable under state and federal laws if an agreement is reached.
The term “binding arbitration” means that the parties waive their rights to trial and the arbitrator’s decision is final. “Non-binding arbitration” means that the decision of the arbitrator is not final, and the parties can request to go to trial if needed.
Again, these all depend on the exact needs and requirements of the parties. Generally speaking, alternative dispute resolution is simply another option for parties to resolve their disputes in a way that is most beneficial and efficient for them, as well as minimizing conflict.
While alternative dispute resolution can often be less formal than a trial, it can still involve some complex legal issues, disputes, and concepts. If you are considering ADR, a reputable business lawyer can advise you on your options and the best course of legal action.
Your lawyer can help you to take into account other legal factors with which you may not otherwise be familiar. They can also prepare you for ADR and can guide you through the process.