Alternative methods of dispite resolution

SECTION 1: ENGLISH LEGAL SYSTEM

1. Introduction

  • Using the courts for dispute resolution can be expensive and traumatic for individuals, often resulting in unsatisfactory outcomes.

  • Increasing reliance on alternative methods of dispute resolution (ADR) by individuals and businesses.

2. Alternative Methods of Dispute Resolution

  • ADR represents various methods to resolve disputes without proceeding to court.

  • Key methods include negotiation, conciliation, mediation, and arbitration.

2.1 Negotiation
2.1.1 Definition

  • A direct attempt to settle disputes between parties through personal communication (face-to-face, phone, email, etc.).

2.1.2 Advantages

  • Fully private process.

  • Quick and cost-effective compared to legal proceedings.

2.1.3 Limitations

  • If negotiations fail, solicitors may be involved. Higher costs may subsequently accrue as negotiations prolong.

  • Many disputes are settled just before trial commencement due to ongoing negotiations.

2.1.4 Documenting Agreements

  • It is advisable for parties to write down and sign any agreements reached to prevent misunderstandings.

2.2 Conciliation
2.2.1 Definition

  • Involves a neutral conciliator who aids parties in reaching a compromise agreement, which can occur pre-court or at any stage before the trial.

2.2.2 Role of the Conciliator

  • The conciliator explores the common ground between parties, discusses individual needs, and facilitates discussions.

  • They can suggest potential compromises but do not enforce them.

2.2.3 Process

  • conducted privately, either through direct meetings or by private discussions relayed via the conciliator.

2.2.4 Advantages

  • Solutions can be based on practical considerations rather than strict legalistic interpretations, promoting future cooperative relationships.

  • Less adversarial than court proceedings.

  • May not always result in a legally binding resolution, leaving options open for further action.

2.3 Mediation
2.3.1 Definition

  • A neutral mediator assists the parties in reaching a settlement.

2.3.2 Role of the Mediator

  • Mediators do not provide opinions on merits but facilitate communication, helping parties explore potential agreements.

  • May suggest grounds for resolution, but the ultimate decision rests with the participants.

2.3.3 Characteristics

  • Suitable for disputes with potential for cooperation.

  • The process is flexible, and parties control their decisions.

2.4 Arbitration
2.4.1 Definition

  • A legally sanctioned method of dispute resolution, governed by the Arbitration Act 1996, allowing parties to submit disputes to a third-party arbitrator.

2.4.2 Legal Framework

  • Section 1 of the Arbitration Act 1996: Establishes arbitration’s purpose for fair resolution through an impartial tribunal without unnecessary delay or expense.

2.4.3 Agreement to Arbitrate

  • Can be established before or after a dispute arises. Commonly included in contracts as a Scott v Avery clause.

  • Mandatory arbitration clauses in contracts enforce arbitration instead of litigation in court for disputes.

2.4.4 Role of the Arbitrator

  • Parties can agree on the number and type of arbitrator (e.g., expert in the field).

  • If no agreement is reached, a court can appoint an arbitrator.

2.4.5 Arbitration Hearing

  • Procedures for arbitration can vary based on parties' agreement. Options include:

    • Paper arbitration: Submissions made in writing.

    • Oral hearings with submissions and witness testimonies.

  • Allows flexibility regarding logistics and procedures.

2.4.6 Arbitration Award

  • The decision made is referred to as the award, which is binding.

  • Can only be contested in court under specific conditions such as serious irregularity or legal points.

3. Advantages and Disadvantages of ADR Methods

3.1 Advantages of ADR

  • Negotiation: Quick, no costs, fully in control.

  • Conciliation: Cheaper than court, potential future agreements.

  • Mediation: Cheaper than litigation, non-binding but encourages participation.

  • Arbitration: Flexible procedures, privacy, quicker than courts, cheaper in many instances.

3.2 Disadvantages of ADR

  • Negotiation: May fail without agreement; legal costs may arise.

  • Conciliation: May lead to forced resolutions and non-binding outcomes.

  • Mediation: May not lead to resolution; voluntary participation means one party may withdraw.

  • Arbitration: Final decisions with limited appeal rights; unequal bargaining power may exist.