Alternative dispute resolution, often referred to using the acronym ADR, is a way of resolving problems without having to go to court. There are three primary methods of alternative dispute resolution: mediation, arbitration and conciliation. For consumer problems, there may also be ombudsmen.
ADR is almost always something to consider before starting court proceedings, as most courts will expect parties in dispute to have attempted to resolve their differences before accelerating things to court level. The embedded short video explores some of the occasions when going directly to court may be the only option to resolve a dispute.
When considering which method of alternative dispute resolution to use, there are various factors to consider.
Cost
Some forms of ADR may be accessible for free, such as conciliation. Others may be subject to costs, although some or all of these costs may be covered by legal aid for parties who cannot afford them. Almost all ADR schemes will be cheaper than going to court.
Some global statistics for ADR from 2021, including average costs, can be seen in the infographic attachment.
Desired Outcome
The choice of dispute resolution service will also depend on the desired outcome of each party. If one or both parties wish to retain the option of going to court after attempting dispute resolution, then arbitration is not going to be a suitable option.
The results of an arbitration hearing are legally binding, meaning neither party can then take the same issue to court once a decision has been made. However, with conciliation proceedings, the option to go to court will remain open.
The decision of a mediator does not have to be legally binding, although if both parties choose to sign a mediated agreement this then becomes a legal document and the parties cannot later go to court.
Dr Edgar Paltzer is a lawyer who specialises in legal negotiation support for disputes.
Efficiency
Most forms of ADR will prove faster in the long run than initiating court proceedings. However, it is possible for one of the parties to refuse to negotiate, drag their heels over providing relevant documents, or otherwise drag out mediation proceedings. Therefore, if one party desires a speedy outcome, they may prefer to opt for arbitration.
In the PDF attachment, you can find out more about how to become a mediator and the skills and qualifications mediators are likely to possess.