Alternative Dispute Resolution (ADR) Workshop 12 Nov 2015 © Margarita Dimitrova.

© Margarita Dimitrova

Alternative Dispute Resolution(ADR)

Workshop

12 Nov 2015


Outline

1. Meaning of ADR2. Philosophies behind ADR3. Methods of ADR4. Advantages 5. Disadvantages6. Further information


1. Meaning of ADR

A – ‘alternative’ “activities or possibilities that depart from or challenge traditional norms”


D – ‘dispute’“a specific disagreement concerning a matter of fact, law or policy in which a claim or assertion of one party is met with refusal, counter-claim or denial by the other”.

R – ‘resolution’“the way of finding solution of a dispute by the agreement of both the parties with some mutually agreed terms”


In other words...

…ADR is an umbrella term which encompasses various processes for resolve conflicts by other means than traditional litigation. It describes the ways that civil disputes can be settled with the help of an independent third party and without the need for a formal court hearing.

2. Philosophies



The need for ADR...

...litigation can be

Costly

Complex

Damaging for reputation


Win-Win Approach

• “A better way to resolve a dispute is through persuasion and compromise, rather than by coercion through a sovereign authority.” Confucius

• In Adversarial trial system, the focus is on ‘rights’ of the parties and on ‘winning’ the case.

• In ADR system, the ‘interest’ of the parties and the aim to ‘satisfy’ that interest is what is at the forefront. This gives to a greater potential to attend a win-win solution.


Integrative Approach

• When disputes arise between parties of different opinions a trial process could lead the parties to become antagonistic to each other.

• ADR tries to attain a consensual solution between the parties based on their common interest. This integrates the parties and provides them with an option to continue their relationship on the basis of a shared interest in the future.


Compliance With Social Norms

• The trial system relies strictly on legal principles which leads to rigid solutions.

• The ADR system allows third party facilitators to adopt or consider social norms in light of the interests of the parties which flexes the finding of acceptable solution.


That is why...

• Under the Civil Procedure Rules, parties involved in litigation are encouraged to use ADR.

• The court can also impose cost sanctions if it decides that one or more of the parties have been unreasonable in refusing to attempt to settle their dispute out of court using ADR.


3. Methods


Three main types of ADR

• Arbitration

• Mediation

• Conciliation


Arbitration is the adjudication of a dispute with the involvement of an independent third party who actively makes suggestions and actually imposes a decision on the parties.

Arbitration is binding and hence regulated

The magistrates’ court refers all civil disputes involving claims less than £10,000 to arbitration

Arbitration


Arbitration

• The independent 3rd party will be one or more specially-appointed experts or lawyers.

• People who work as arbitrators often belong to the Chartered Institute of Arbitrators.

• Arbitration is governed by the Arbitration Act 1996.


Arbitration Act 1996, s.1

a) the object of arbitration is to obtain the fair resolution of disputes by an impartial tribunal without unnecessary delay or expense...

(b) the parties should be free to agree how their disputes are resolved…


Choosing an arbitrator

• Parties are free to decide between themselves whom they will appoint as an arbitrator.

• Where there is no agreement a party can apply to a court under the Arbitration Act 1996 s.18 to have one appointed by the court.

• S.33(a) requires that the arbitrator should act fairly and impartially as between the parties, giving each party a reasonable opportunity of putting his case and dealing with that of the opponent.


Use of Arbitration

• A dispute might be referred to arbitration by the court, by law or by the parties themselves.

• Arbitration is common in many trade practices.

• For instance, many insurance policies contain a clause stating that any dispute over a claim will first be referred to an arbitrator before any court claim is made.

• For Commercial Disputes, a judge in the Commercial Court (specialist part of the Queen’s Bench Division) may refer a dispute brought before it to an arbitrator.


• Arbitration by contract is when the parties have signed a contract and there is a clause in the contract where they agree to refer any dispute over the terms of the contract to an arbitrator. Such a clause is sometimes known as a ‘Scott v Avery clause’.

• S. 9 of Arbitration Act 1996 Where a party tries to ignore an arbitration clause agreed in a contract, the court in which he or she is trying to make his claim will order a ‘stay’ (i.e. a stop) of proceedings so that the matter may be referred to arbitration as agreed in the contract.


Mediation involves an impartial third party who listens and directs discussion but does not suggest outcomes.

Mediation is voluntary

Atmosphere is informalAll parties have their say

Mediation is not binding

Mediation


Mediation

• Parties in a dispute may refer themselves to mediation (a large number of visits might need to be made).

• There are no fixed rules on mediation

• If parties in litigation refuse an offer to mediate without good reason then even if they win their case in court, the judge can refuse to award them some or all of their legal costs.


Med-Arb

• This is a mixture of mediation and arbitration.

• Here the parties agree to mediate but will refer the dispute to an arbitrator if the mediation is unsuccessful.


Conciliation involves a third part, who may make suggestions to the parties.

The decisions are not binding

Consolidation


Other ADR method...

• Negotiation - involves two parties discussing and compromising to obtain an agreed solution; no legal representation needed; not binding


• Tribunals - these are bodies established to settle particular types of disputes; indeed they act in the same way as a court.

• Their jurisdictions include social security, child support, asylum and immigration, employment, etc.

• Typically a tribunal will consist of 3 members: a chairman who will be legally qualified and two lay members will have expert knowledge in the relevant field.

• A decision by a tribunal can be challenged in court.


• Ombudsmen – a person or institution to investigate individuals' complaints against a company or organization, especially a public authority

• For example: The Parliamentary and Health Service Ombudsman investigates complaints about the unfair or improper treatment of citizens by UK government departments, their agencies and the NHS in England; The Financial Services Ombudsman investigates complaints about financial firms.


4. Advantages of ADR

Less formal than courts

Held at more suitable venues

generally cheaper than litigation

confidential, unlike a court, which is usually open to the public

not adversarial and therefore both parties can come away from the processfeeling as if they have won

Often takes less time than court


5. Disadvantages of ADR

Not suitable for all disputes

Decisions are not legally binding (except Arbitration)

Dispute may still end up in Court

Need both parties to voluntarily participate


6. Further information• The Centre for Effective Dispute Resolution

(CEDR) - www.cedr.com• UK Mediation - www.ukmediation.net• National Mediation Helpline -

www.nationalmediationhelpline.co.uk• Finding an ADR provider -

www.civilmediation.justice.gov.uk• the ADR schemes of many industries and

commercial associations.

Alternative Dispute Resolution (ADR) Workshop 12 Nov 2015 © Margarita Dimitrova.

Documents

Transcript of Alternative Dispute Resolution (ADR) Workshop 12 Nov 2015 © Margarita Dimitrova.