Why Alternative Dispute Resolution? -

(And the advantage we can provide.)

Introduction

Anyone involved in a conflict needs to be aware of alternative dispute resolution, or “ADR.” Litigation in the real world is no cakewalk. Unlike the stereotypical personal injury or malpractice lawsuit that’s portrayed in the media, the typical litigant is not someone who wins the lottery every time he goes to court. The concept of a runaway jury system that rewards unwitting or undeserving plaintiffs is a flat-out myth. Juries and judges are often unable or unwilling to grasp the complexities that are often presented by what one might think is the simplest of suits. In sum, litigation in the real world can be very expensive and unpredictable, and thus financially and emotionally stressful.

To minimize this stress, ADR should be considered. There are three generally recognized forms of ADR: negotiation, arbitration, and mediation. Each form may have certain advantages and disadvantages depending on the particular case. Importantly, no form of ADR is mutually exclusive. Before litigating, it is not uncommon for parties to a dispute to try negotiation, mediation, and non-binding arbitration, or combinations thereof. The following is a brief description of the three major forms of ADR.

Negotiation

Negotiation means what it says. Parties to a dispute attempt to resolve it informally through direct discussions with each other. They may do it face to face. Or, they may do it through agents and/or attorneys. The problem with negotiation is that parties (and even their attorneys) will often be so emotionally involved in a case that they reach an impasse. It is very common for a party to have difficulty putting him or herself in the “shoes” of the other party. Plus, the average person who is either unschooled in the law or who doesn’t grasp all of the facts related to the dispute will often take a position that might make sense to him or her— but that in the eyes of the law is not necessarily valid. Sadly, even attorneys often fall into this trap because they may not fully appreciate all of the facts related to the particular case or because they do not understand the often complex rules of law that apply. The inevitable complexity and lack of clarity of the law is often the cause of these impasses.

Mediation

Mediation is a process in which a trained neutral person, a “mediator,” helps parties in a dispute speak for themselves and make their own decisions. More often than not the parties to a mediation will also be represented or assisted by attorneys. Agreements made in mediation have to be made by the participants, and are not imposed by the mediator. If the parties do not reach an agreement or develop a solution that works for everyone, they can always have their case handled by the court or resolved in some other way. Mediators will not make decisions for the parties. But, they may recommend means of ultimately resolving disputes. Through pointing out the weaknesses and strengths of the positions of each party, a good mediator will give the parties a “reality check” so that they can obtain a broader perspective on their case that they may not have appreciated beforehand.

If the parties do not sign a written agreement in mediation, and decide to take their dispute to court, neither the mediator nor the participants can testify in court about what happened during the mediation. This encourages parties to be frank and honest in their attempts to resolve their cases. Mediation can save a lot of time, money and aggravation. If a relatively inexpensive mediation procedure has a reasonable chance of avoiding onerous litigation, then under a cost-benefit analysis mediation is virtually always worth trying.

Importantly, mediation provides an opportunity for parties to express what’s important to them and to hear other parties’ perspectives. Mediation may help a party to figure out how to get his or her needs and the other person’s needs met by reaching creative “win-win” solutions that work for everyone. Mediation can also help protect people’sprivacy since, unlike courtroom proceedings which are open to the public, mediation is a confidential process.

Arbitration

Arbitration is a private and informal adjudicatory process similar to a court trial, but often with fewer of the formalities and expenses associated with courtroom litigation.

It is not without controversy, however.

In a binding arbitration process, the Arbitrator makes a decision that is legally binding and enforceable upon the parties. Even though the arbitration hearing is much less formal in procedure than a court trial, each party still has the right to present proofs and arguments as in a court of law. In arbitration the disputants do give up the power to create their own solution. They assign the resolution of their problem to an arbitrator (or a panel of arbitrators).

Arbitration can help protect parties’ privacy since, like mediation, it is generally a confidential process.

The biggest advantage to arbitration is also its biggest disadvantage. An arbitrator’s or a panel’s decision is very difficult to have reviewed or to appeal. While this might result in a more streamlined process, it can also result in errors not being subject to correction.

A big concern with arbitration is the fact that the discovery procedures available to litigants are not usually available to disputants in an arbitration. This can be a very serious consideration in complex cases where conducting court-mandated depositions and securing document production and interrogatory responses may be important to one side or the other.

Another concern is that the cost of paying both a lawyer and an arbitrator might not make economic sense where the cost-savings over, say, a jury trial are not presented. A dispute in which the arbitrator’s fees exceeds the value of the subject of the litigation just doesn’t favor the aggrieved party.

Finally, in certain types of disputes, arbitrators are becoming notorious for favoring the parties who typically prepare the contracts that contain arbitration clauses–such as in the domain of consumer goods and services or transactions where one party may not be very sophisticated or is at a bargaining disadvantage.

In this regard, see a copy of a published letter to the editor in a recent edition of the Fulton County Daily Report.

Many courts offer what is called “non-binding” arbitration. Typically this involves an arbitration hearing in which the parties are allowed to try their cases as they see fit. The arbitrator(s) will render a decision. If each party agrees with the decision, then the arbitration award will become final and therefore dispositive of the dispute. However, if just one party disagrees with the award he or she can appeal the award and go to court and have a formal trial. The arbitration award will not be enforced. But, in light of the arbitration award, the parties will often have a pretty good idea of how a formal trial might end up for them.

Long Distance ADR

A new dynamic is revolutionizing Alternative Dispute Resolution. Its name is “Long Distance ADR” or “LDADR.” This is a technique by which new technology facilitates the pursuit of ADR by persons for whom the costs and results of ADR were once prohibitive.

Because videoconferencing technology has reached such a high level of quality and because videoconference studios are almost everywhere, parties from every corner of the earth can now “meet” virtually and at a fraction of the cost once associated with (1) air travel, (2) lodging, and (3) time away from family, and work. Informal resolution is easier to achieve because parties who are separated geographically can now negotiate and mediate more easily and more effectively.

Conclusion

A competent attorney can best inform the client of what might be the best ADR procedure to incorporate into the client’s overall dispute resolution strategy before the client goes to court, if indeed an ADR procedure is even worth pursuing. Sometimes it may be cheaper and easier to just litigate a dispute because the time and resources required for ADR might be comparable to those that would be expended anyway in an actual trial, and the bias known to be associated with certain areas of arbitration can be avoided. A good attorney who is truly concerned with his or her client’s welfare will also attempt to give his or her client—in confidentiality—an objective assessment of the client’s position. In sum, it is wise to inform oneself of all available ADR options before consulting with a competent attorney so that the client goes into the initial interview able to ask the attorney the right questions from an already more informed perspective.