What is Alternative Dispute Resolution?
Alternative dispute resolution (ADR) is a collective name used for a variety of methods designed to resolve disputes and can be used to avoid Court proceedings or resolve them.
The National ADR Advisory Council defined Alternative Dispute Resolution (ADR) as an:
“Umbrella term for processes, other than judicial determination, in which an impartial person assists those in a dispute to resolve the issues between them.”
ADR may be undertaken voluntarily, pursuant to a contractual obligation or pursuant to a Court Order.
What are the different types of ADR?
There are a number of different types of ADR however, the most common types of ADR include mediation, conciliation, and arbitration.
What is mediation?
Mediation is a process involving a neutral third party (mediator) who assists parties to a dispute to identify issues, develop options, consider alternatives, and try to reach an agreement which meets the underlying needs and interests of the parties. It is ordinarily conducted on a confidential and without prejudice basis – meaning, things said and exchanged throughout the mediation cannot be used beyond the mediation.
A mediator has no advisory or determinative role and does not give his or her opinion on the issues, nor can a mediator force an outcome to the mediation or dispute generally.
What are the different types of mediation?
There are four different types of mediation. These include:
A. Mediation (general or “shuttle” mediation)
Mediation is a process in which one mediator works with parties to a dispute. It can involve joint sessions with the mediation (often “opening sessions” or “opening remarks”) but typically involves the parties being separated in the process and the mediator “shuttling” between them to identify issues and concerns, identify interests and options in an endeavour to reach agreement. than engaging everyone as a group, the parties are separated. The disputants’ meetings with the mediator may occur on different days, or at different times. The mediator engaged in discussions with each party separately to listen and understand a party’s concerns and interests and convey the concerns and interests to the other.
Co-mediation is a process in which two mediators work together to help the parties reach an agreement. One mediator works with each party, removing any concerns about fairness or objectivity that traditional mediation is commonly associated with.
C. Mediation-arbitration (“med-arb”)
As the name suggests, Med-arb is a hybrid form of dispute resolution. If all reasonable efforts to resolve the dispute through mediation fail, the dispute proceeds to arbitration.
When is mediation suitable?
Mediation can be of use in providing structure to a negotiation through the guidance of a neutral third party. Mediation is intended to facilitate the exploration of solutions, can assist in maintaining relationships and be faster and cheaper than litigation and possibly lead to, broader and more flexible outcomes than a Court can offer.
Even if mediation does not resolve the dispute, it may nevertheless provide utility in narrowing issues in dispute and identifying underlying concerns and interests of the parties involved.
Conciliation is a process where an independent third party (conciliator), assists parties to a dispute to identify issues, develop options, consider alternatives and work to an agreement. A conciliator will not make a judgment or decision about the dispute.
The role of a conciliator is similar to mediators save that a conciliator may also:
have specialist knowledge in the subject matter in dispute;
provide expert expertise on the possible options for sorting out the issues in a dispute;
have an advisory (but not determinative) role on the content of the dispute or likely outcome(s) should the dispute not be resolved.
When is conciliation suitable?
Conciliation is useful when parties seek in the dispute resolution process, specialist knowledge or advisory guidance having regard to the Conciliator’s expertise or familiarity of certain subject matter or industry.
Arbitration is a quasi-judicial, adversarial process whereby an impartial third party (arbitrator) makes a binding determination (an award) after hearing the parties’ respective positions and/or evidence. Arbitration is particularly useful where the subject matter is highly technical, or where the parties seek greater confidentiality than in an open court.
Participation in arbitration can be:
Court ordered; or
Required pursuant to a contract.
The main differences between arbitration and other forms of ADR, such as mediation and conciliation, include arbitration:
involving a more formal and structured process;
typically requiring production of evidence;
often requiring the parties’ prior agreement that the arbitrator’s decision will be binding and enforceable; and
resulting in the arbitrator making a binding decision concluding the dispute (subject to any review or appeal rights).
When is arbitration suitable?
Arbitration is useful if mediation or conciliation has or may be insufficient and/or where the parties are willing (if not required) to be bound to a confidential determination without the need of engaging in or continuing litigation.
Arbitration can be attractive to commercial parties given it is confidential and efficient and presided over by arbitrators who typically have competence or expertise in a particular field or in arbitrations generally.
How can BlackBay Lawyers assist you?
Given the cost, time and distraction that traditional litigation can cause, parties are increasingly choosing to explore ADR processes given they can provide a cheaper and more efficient outcome for parties.
If you wish to explore ADR processes as part of your dispute or require advice or representation in any ADR process, please feel welcome to contact BlackBay Lawyers at firstname.lastname@example.org or (02) 9100 0889 for expert guidance.
Authored by Victoria-Jane Otavski and Rebecca Chea