Alternative dispute resolution
There are some processes that can be used to settle commercial disputes instead of the litigation process.
The most common types of Alternative Dispute Resolution (ADR) methods
Mediation is a voluntary process in which the mediator helps the parties reach a negotiated settlement.
The style of mediator may be facilitative, evaluative or conciliatory or a mix of all three, depending on the wishes of parties.
Arbitration is an alternative to litigation and can offer significant benefits, for example the ability to appoint an arbitrator with suitable expertise to deal with the dispute, particularly if it is of a technical nature.
The hearing will be held in private and the dispute will therefore be kept out of the public domain.
It is not necessarily quicker or more cost-effective than litigation, although it can be.
The parties to a contract can agree that in the event of a dispute a decision maker will be appointed to act as an expert in determining the dispute. Their decision shall be final and binding with no appeal.
This can be useful in a technical dispute for example, construction and engineering disputes.
It is generally quicker and cheaper than litigation or arbitration but less flexible than mediation.
Adjudication is frequently used in construction and engineering disputes and is a “pay now/argue later” regime. It is intended to prevent one party withholding payment to coerce the other into an unfair settlement.
The parties are still able to litigate, arbitrate or use some other form of ADR to resolve the dispute.
For more information on Alternative Dispute Resolution methods please contact Claire Haverfield.