Alternative dispute resolution (ADR) is a term used to describe a variety of methods for seeking to resolve a dispute, other than by Court determination.
ADR can be explored by parties prior to the issue of proceedings or once a claim has been started. The Court, in fact, actively encourages parties who are involved in legal proceedings to engage in ADR and adverse cost consequences can be imposed on parties who unreasonably fail to engage in the ADR process.
Below are some of the main methods of ADR used by parties involved in a dispute.
Negotiation is perhaps the most informal ADR process. Discussions concerning settlement typically proceed on a without prejudice basis, meaning that any concessions made by parties in seeking to bring a a matter to a conclusion cannot be relied upon by the other party if settlement is not reached and Court proceedings are necessary.
Mediation involves the parties to a dispute instructing a third party (a mediator) to act as an unbiased intermediary. The mediator will not usually make a ruling on a case but will instead listen to the arguments from the parties and seek to facilitate an agreeable settlement. Even if mediation does not result in settlement on the day, it often acts to focus parties’ minds and it is not unusual for a settlement to be reached shortly after mediation.
Adjudication, like mediation, involves the appointment of a third party (the adjudicator). However, unlike mediation, the adjudicator will make a determination of the dispute that is typically binding on the parties. The requirement to refer a dispute to an adjudicator (and the process for doing so) can be included as a contractual term, with this being particularly common in the construction industry. Adjudication is often seen as a cost effective and relatively speedy way of resolving disputes.
Arbitration is similar to the adjudication process, although it is often seen as being a more flexible method of ADR. Unlike an adjudicator, who will usually only listen to the legal submissions, an arbitrator can and often will seek to ascertain any relevant facts relating to a dispute. The decision of the arbitrator (known as an ‘award’) is binding and unlike an adjudicator, an arbitrator has the power to make an order in respect of costs.
Our lawyers are available to discuss and assist you with any of the methods of ADR described above, or if you have any questions relating to other options for settlement.
Our lawyers are available 24/7 to assist you and provide legal advice. Contact London 020 3753 5352 or Manchester 0161 834 7284. Alternatively you can email firstname.lastname@example.org