Alternative Dispute Resolution (ADR) is a means of resolving disputes by using an independent third party to help the parties in dispute reach an amicable solution. It is an alternative to litigation and may save the parties involved considerable time, expense and stress!
ADR is actively encouraged by the Civil Procedure Rules in order to further the overriding objective, that is, to deal with cases justly. The advantages of using ADR, as an alternative to litigation are manifold. ADR is cheaper and quicker than litigation and the procedure is flexible to the extent that the parties can choose any one of the various types of ADR and are not constrained by the normal deadlines which are inevitable with litigation. One of the most important advantages of ADR is that the parties, despite their dispute, may wish to preserve their business relationship and work with each other again in the future, which is helped by the non-confrontational nature of ADR. Because ADR is a private affair between the parties and the independent third party, the parties will also avoid any unnecessary negative publicity.
It must be remembered, however, that because ADR is not binding upon the parties, any agreement which is reached between the parties is not so easily enforceable. There is also no requirement for each party to disclose all the evidence which each one possesses and so one party may easily hide quite a damning document, and so this may lead to a wrong decision being made. ADR is not appropriate for all disputes, and sometimes, litigation is inevitable.
The various types of ADR are below:
- Expert appraisal and early neutral evaluation
- Judicial appraisal
- Expert determination
- Final offer arbitration
ADR is becoming an increasingly popular means of resolving disputes. It can provide a quick and cheap means of resolving a dispute in a commercially sensible manner.