When clients see a lawyer they are often advised to consider alternative dispute resolution (ADR) either before commencing litigation, or with a view of reaching an agreement once litigation has commenced.
The method most often recommended is a round table conference, or a mediation.
However, consider these additional methods of ADR:
There are two more methods of ADR which academics include on the spectrum of ADR processes, but which lawyers rarely consider to be a dispute resolution method. These are “walking away” and “litigation”.
So, if you or your client are considering ADR to resolve the dispute, how do you know which method to choose? This blog will provide you with some guidance that will assist you in making the right choice for yourself or your client.
- Walking away
Yes, some people do choose to walk away from a dispute, or to ignore it at least for the time being. Where a dispute has not progressed to litigation, for example if it is a dispute with a neighbour or involves a small amount of money, then “sleeping on it” or walking away may indeed resolve it. The other party may decide that it is not worth pursuing and may abandon the argument. However, where the dispute has progressed to litigation or involves legal representatives, it may not be prudent to ignore it. If a letter was sent, it may include a time frame within which a response must be provided. A court application will always have a time frame for a response. Ignoring these may lead to default judgment, thus giving the application what they wanted in the first place.
- Round table conference
This method of ADR is frequently used by the parties in the early stages of their dispute. The parties are generally represented by their lawyers and it is an informal discussion about the facts of case, the evidence, and what each party wants. There is no independent party conducting the conference. The parties representatives generally do most of the talking, leading towards an exchange of offers. This method rarely results in an agreement. The evidence would not have been tested, many allegations may be unsubstantiated, and the power imbalance between the parties or their lawyers is often clearly seen. Round table conferences are also sometimes used to surprise the other party, or their solicitor, with important information or evidence that shifts the case in their favour. Although this method of ADR is more cost effective because it does not involve an independent party conducting the conference, it should only be used by parties who genuinely wish to resolve the dispute, or narrow down the issues to progress the case towards a resolution.
A negotiation may be assisted by an independent person, or may be unassisted, taking the form of a round table conference. Negotiations are most commonly assisted. The parties are generally represented by their lawyers, and their lawyers do most of the talking. A negotiation is more formal than a round table conference, and the lawyers are thoroughly prepared having researched the applicable legal principles. Investigations would have been completed, most of the evidence would have been gathered, and there would be few unsubstantiated allegations. The negotiator facilitates the discussion. This form of ADR is most commonly utilised when the dispute has been ongoing for some time and the parties are ready to make a genuine attempt to resolve it.
Mediation is conducted by a mediator, who is an independent third party. The mediation is formal, and consists of specific steps from which the mediator does not depart. These steps include the mediator’s opening statement, the parties’ opening statements, identification of the issues and common ground, and separate sessions where the mediator does some “reality testing”. There is a final joint meeting where the mediator facilitates the parties coming to an agreement. Mediations have a very high success rate, with an estimated 95% of disputes being resolved. This form of ADR may be chosen either early or late in the dispute. However, parties may be more comfortable in reaching an agreement once their lawyers have undertaken some investigations to rule out some unsubstantiated allegations or narrow down the issues.
Conciliation is conducted by a conciliator, who is an independent third party. A conciliation is effectively the same as a mediation. The difference is that a conciliator has an advisory role. The mediator does not. Parties and their solicitors choose a conciliation when they require expert advice about the dispute, such as what the court is likely to do if the matter proceeds further. The conciliator would be chosen based on their area of expertise. However, the parties are not obligated to accept the advice, and the conciliator does not make a decision for the parties. Like a mediator, the conciliator facilitates discussions and negotiations. This ADR method is often chosen in complex matters where the parties and their lawyers wish to be assisted by an expert in the particular area of law.
Unlike the mediator who does not need to possess any legal qualifications, the arbitrator is generally a qualified and experienced legal practitioner, and sometimes a former judge. An arbitration does not give the parties the option of negotiating an agreement. It is a determinative process where the arbitrator conducts an informal hearing and makes a decision. The parties are bound by the decision. This form of ADR is most commonly used in complex commercial disputes and is a much more expensive exercise than a negotiation, mediation or conciliation.
This is by the far the most stressful and expensive form of ADR. Because litigation ultimately results in either an agreement by consent or a court order, it is considered a form of dispute resolution. The benefits of this form of ADR are that some parties may feel that they have a fair outcome because it is based on legal precedents, they have procedural fairness, and the decisions are binding. However, other parties may experience the disadvantages of litigation. These include the delay of getting to a final hearing, the high cost, the stress of being cross examined in the witness box, having their dispute being heard in an open court, and having a decision imposed on them. Litigation is often the last resort and parties may have no option but to head down this path.
Which option do you choose?
The form of ADR that you choose for yourself or your client will depend on whether:
- the dispute is in its early stages or has been ongoing for some time;
- the parties are ready to make a genuine effort to negotiate an agreement;
- there are any issues of power imbalance that would hinder negotiations;
- an independent third party is required to facilitate discussions;
- the independent third party needs to be an expert in the area of law;
- the parties wish to keep the dispute confidential;
- the parties prefer to come to an agreement or have a decision made for them; and
- how much money the parties have and are prepared to spend.
Having considered the nature of the dispute and the above questions, you and your client should be in a position to determine what to do next to resolve your dispute. For further assistance or guidance, please contact me.
How I can help
Having practiced as a solicitor prior to becoming a barrister I understand the challenges that solicitors face in choosing the right ADR process for their clients. Assisting lawyers and their clients to resolve their disputes as an accredited mediator, and having taught Dispute Resolution at the QUT Law School, I have the necessary knowledge and skill to assist you.
As a barrister I can assist you by advising you and your client on the most appropriate method of ADR, by advising on your client’s prospects of success if they were to litigate, and by representing you and your client at the ADR process chosen.
As an accredited mediator I can assist your client and the other party to reach an agreement using a facilitative model of mediation. If you need assistance with any of these matters please contact me on 0466 547 787 or firstname.lastname@example.org.