When disagreements or conflicts arise there are several alternatives to litigation (court proceedings) in order to resolve them. Those alternatives are referred to collectively as ADR.
Some of those alternatives involve equally formal proceedings and result in a binding decision reached by a third party. Some of them are less formal and involve attempts by the parties to settle the dispute themselves (with or without the assistance of a third party).
In this blog, our dispute resolution team presents an overview of the typical formal ADR processes and less formal ADR processes and addresses some frequently asked questions related to the subject.
Types of Formal ADR Processes
Perhaps the most common alternative to litigation is arbitration. Arbitration follows a similar process to litigation, but the parties appoint an arbitrator instead of a judge. Typically, commercial contracts require the parties to refer any future dispute to arbitration rather than litigation.
Another alternative to litigation in the construction industry is adjudication. This process enables conflicting parties to refer their dispute to an adjudicator.
Frequently, an adjudicator’s decision is needed promptly to ensure the smooth progression of a construction project. The parties may contest it at a later stage in litigation but the aim is to find a resolution allowing the construction process to continue without significant disruption.
Parties involved in a dispute may also choose to refer their case to an expert in the relevant field, agreeing that the expert’s decision will be binding for them. This method can be faster and less expensive compared to litigation or arbitration. However, there are drawbacks – for instance, if the dispute primarily involves legal issues, it may necessitate the intervention of a judge or arbitrator to reach a resolution.
Types of Less Formal ADR Processes
Even when a dispute is the subject of a formal process to resolve it, the parties often engage, at the same time, in attempts to settle their dispute. In the case of litigation, the court rules require parties to a dispute to do so.
The most straightforward of these processes is negotiation. Negotiation can take place in correspondence or in meetings. In either event, they usually take place on what is known as a without prejudice basis – which means that nothing said during those negotiations can be used in any formal legal process (for instance, negotiating parties may make some concessions in an attempt to get a deal done and those concessions cannot be used against them if there is no settlement).
Sometimes negotiating parties enlist the assistance of a third party. The most common and arguably effective method is mediation, where a third-party lawyer joins a meeting between the parties and tries to facilitate a settlement. The mediator will “reality test” the parties’ positions and challenge them on their respective positions. Mediation is an effective way to resolve disputes and leads to a successfully negotiated (and binding) settlement in something like 75% of cases. We recommend it to our clients in most cases.
Is ADR legally binding?
Settlements reached as a result of ADR are legally binding. The terms of settlement can be enforced in the same way as court judgements.
Should I consider ADR to resolve my dispute?
We encourage our clients to assess the potential for Alternative Dispute Resolution (ADR). Our team will offer tailored recommendations to help identify the most appropriate method based on the unique aspects of your dispute. While ADR might not be a viable solution for every conflict, it has demonstrated its effectiveness in achieving cost-effective resolution and usually warrants serious consideration.
Alternative Dispute Resolution Solicitors
When a dispute arises and cannot be settled by the parties, it is crucial to seek the assistance of an experienced legal professional. The specialist dispute resolution solicitors at Bridge McFarland LLP have extensive expertise in handling civil and commercial disputes concerning both personal and business matters.
Our skilled solicitors in Hull, Grimsby, Market Rasen, Louth, Scarborough and Lincoln can provide valuable support in the High Court and County Court, as well as in various forms of alternative dispute resolution (ADR). Our ADR specialities encompass:
- Expert Determination
At Bridge McFarland LLP, our team of experienced litigation lawyers can assist you in relation to your dispute. Please call us on 0800 987 8800 today.