Alternative Dispute Resolution – or ADR is often referred to in the course of seeking to resolve disputes. There are various forms of ADR but the aim, with all forms, is to seek to resolve disputes without troubling the courts or tribunals. ADR can be entered into before or during proceedings. It is usually never too late to seek to resolve your differences. Judges can and will nudge and encourage parties to enter into ADR and although it is still not compulsory, they can impose costs sanctions if you nreasonably refuse.
Litigation should with any dispute be used as a last resort. Before any proceedings are issued the parties to the dispute should always seek to resolve their differences or at least narrow the issues. Even if a form of formal ADR is not agreed, the parties should enter communications and set out their positions. Under the various Pre Action Protocols and Practice Directions of the Civil Procedure Rules parties should exchange information before issuing proceedings. It is also possible to make without prejudice offers to seek to resolve disputes, or have without prejudice round table meetings to seek to resolve disputes.
Litigation is generally a very expensive exercise and there are limitations to what the court can award; quite often it is an all or nothing situation. There are many variables which increase the risks involved. ADR can be undertaken at almost any stage of a dispute and you can agree on a mediator or adjudicator that is suitable for the role. You cannot choose your Judge.
Here, TSP Director, Sharon Auton, who leads the Thompson Smith and Puxon (TSP) Dispute Resolution team, and is also a qualified mediator, discusses some of the most common forms of ADR.
The definition of mediation is “an attempt to bring about a peaceful settlement or compromise between disputants through the objective intervention of a neutral party”. The mediation process is voluntary and can only be entered into with all parties’ agreement. The parties will agree on which mediator to appoint; usually someone with experience in that particular area.
During the course of my career I have been involved in many mediation meetings involving all manner of disputes. I have been amazed by cases that have settled, where I was doubtful that they would, and where participants have, surprisingly, given the strained state of relations at the start of the mediation process, ended up rebuilding relationships that had faltered over these disputes. It is particularly rewarding for me when this happens.
The mediator is trained, impartial and independent. They will generally have received a bundle of documents before the mediation commences and will have received each participant’s “side of the story”. It is not the mediator’s job to judge; it is the mediator’s job to help the parties reach a resolution. It is each other they must convince, not the mediator. Quite often there will be an open session in which the participants can have their say, which can be quite therapeutic. Sometimes, participants just want to be heard. You don’t have this opportunity in Court so it can be a much more satisfying process for everyone involved.
Mediation has a structure, timetable and dynamics that negotiation may lack. The process is without prejudice, private and confidential. The presence of a mediator is the key distinguishing feature of the process. Mediators use various techniques to open, or improve, dialogue between disputants, aiming to help the parties reach an agreement. The mediator must be wholly impartial and independent. An agreement, if reached, is committed to writing, signed by the parties and then becomes binding.
The important things to remember about using mediation to resolve a dispute are
- It is usually cost effective
- Success rates are high and there is a significant chance you will reach an agreement
- It will generally only take a day of your time, or less
- It is less stressful than going to court and there is an opportunity to repair relationships
Adjudication is a common way of seeking to resolve many types of disputes, particularly in the construction industry, where it is can be compulsory in many contracts.
It is a reasonably quick procedure, usually lasting 28 days, although the parties can agree to extend this period. In construction in particular it is designed to protect cash-flow during construction contracts and to avoid clogging up the courts with this type of dispute.
Adjudication is appropriate for resolving claims relating to:
- Interim payments
- Delay and disruption of the works
- Extensions of time for completion of the works
- Defects in the works
- The final account
- Breach of contract
- Termination of a contract
- Professional negligence
Instead of construction disputes being dealt with by Judges in court, adjudication can be instigated by either party to a dispute and is dealt with by an Adjudicator who will usually make a decision on paper (having had representations from both parties) and the decision is usually binding. The adjudication is confined to the dispute specified in the notice of adjudication. The decision may be enforced by the successful party in the Technology and Construction Court.
As with litigation, before starting adjudication, you need to make sure that you have set out your position to the other party, so that they know what you case is, and then need to serve a notice on them.
Arbitration is a further alternative to litigation as a means of resolving disputes. It is based on the parties’ agreement, usually in the form of a contract, and the decision is final and binding. Arbitration proceedings are usually confidential and the parties agree which tribunal will arbitrate.
Arbitration involves an impartial outsider being asked to make a decision on a dispute. The arbitrator makes a firm decision on a case based on the evidence presented by the parties. Arbitration is voluntary, so both sides must agree to go to arbitration; they should also agree in advance that they will abide by the arbitrator’s decision. It can be seen as an alternative to a court but it is private rather than public. Unlike a court, in an arbitration hearing the arbitrator will ask the questions. It is often be used in employment related disputes and some construction related disputes.
Early Neutral Evaluation
Early Neutral Evaluation is another form of alternative dispute resolution in which an independent and impartial evaluator is appointed to give the parties an assessment of the merits of their case. Quite often this is a Judge. The aim is to provide the parties with an objective and realistic view on the strengths and weaknesses of their respective cases, and to serve as a basis for negotiations. It is without prejudice and non-binding but will usually give a good indicator of how the matter is likely to be determined should it proceed to trial and will hopefully encourage the parties to resolve their differences.
Sharon has over 17 years’ experience in Dispute Resolution (and Litigation, a name by which the team was previously known). She is professional, friendly and approachable, acting for a wide range of clients, both individuals and businesses, in dispute resolution matters.
The types of dispute with which Sharon and her team can help are many and varies and include landlord and tenant disputes (residential and commercial), breach of contract disputes, commercial disputes, consumer disputes, construction disputes, neighbour disputes, harassment and injunctions, contentious probate, professional negligence, and claims under constructive and/or resulting trusts.