ALTERNTIVE DISPUTE RESOLUTIONS (ADR)
With the growing concern over delay and considerable cost of litigation conducted in an adversarial and combative manner, the use of ADR has become imperative in the English Civil Justice. Since its introduction, ADR has proven to be of significant advantage. ADR is relatively (mediation in particular) inexpensive, as there is no need for a need of legal representation. On the other-hand, even if one decides to a lawyer, ADR also tends to be cheaper than litigation because, it provides for speeder resolution. Although its advantages tend to outweigh the disadvantages, it is worth mentioning some of the major concerns over the adoption of ADR. The most unanimous concern is the claim; ‘ADR cannot serve best in cases where there is a considerable imbalance of power between litigants’. Fiss argues that, ADR can enhance the difference in power between parties rather than redressing them . He claims that, litigants with less financial resources can be in a disadvantaged position compared to their well-off counter parts. However, Fiss’s argument can be disputed on the following ground; since, ADR is voluntary and generally aims at a compromise by giving parties a free role in reaching a common ground of understanding .As such one can argue that, unlike court proceedings where lawyers play a vital part in the winning prospects of a case, ADR, however tend to allocate more powers to the parties themselves . This piece of work will first provide an overview of ADR in the light of its meaning, types, background, and developments. Secondly, its strengths and weaknesses will critically be discussed. Then, the types of ADR will be discussed, and finally a good form of ADR which is suitable to our client will be selected.
There is no single overarching definition of ADR, however, one could define ADR based on its general features . ADR is a range of voluntary, inexpensive options for solving disputes without going to court. However, a more authoritative definition as defined in the glossary to the CPR provides that ‘ADR is a collective description of methods of resolving disputes otherwise than through the normal trial process .
Robert& Palmer claim that, the period from the end of 1970’s onwards, is the turning point in English civil justice as to the use of ADR . This is because during this period, it is when the discussion of ADR begun to be translated into institutional shape. They provided four factors which stimulated the development of ADR; at the foremost, is the role played by Lord Woolf’s report in unmasking the problems of court’s litigation-delay, costs, inaccessibility of courts . Secondly, is the emergency of new professional groups offering institutionalised help for parties away from courts. The third factor, is what termed as ‘re-modelling of legal practise’ whereby lawyers became ready to assume none-aligned facilitatory role. Lastly, is the encouragement of the use ADR by the Practice Directions, CPR, as well as the redefinition of civil courts whereby the active sponsorship of settlement becomes a primary responsibility . The contemporary resurgency of ADR can be argued to be distinctive in several important ways; first, has been the speed with which the new groups offering institutionalised support have become professionals. Secondly, has been the counter movement of recover y under which lawyers have developed alternative forms, as well as treating ADR as the main umbrella under which they have re-modelled certain areas of legal practice. Lastly, has been the extent to which lawyers have embraced ADR .
The use of ADR has proven to be of significant advantages. Some of the benefits of ADR as pointed out unanimously by commentators, judges, as well as legal scholars, are as follows; The first important advantage is that, unlike litigation, ADR (apart from arbitration) is more inexpensive . ADR tends to be inexpensive because of two major reasons; first, there is no need for a legal representation, secondly, even if one uses a lawyer, ADR is still inexpensive because it ensures quick settlement . Apart from being inexpensive and speedy ADR is voluntary, flexible and confidential . It is suggested that, submission to an ADR process is voluntary because it is on the parties’ discretion whether or not to use ADR. However, in Shirayama Shokusan Co and Ors v Danovo Ltd , it was held that the court have the jurisdiction to order parties to attempt ADR even if one party is unwilling. Nonetheless, one should never dwell on the decision of this case, because in practise ADR is absolutely voluntary because there will be little to be gained from an unwilling and aggrieved opponent in ADR process such as mediation .
As stressed above ADR ensures confidentiality . It is argued that, many forms of ADR such as mediation are conducted in total confidence and on a no ‘prejudice’ basis . However, not only does ADR ensure parties’ confidence, but also it tends to safeguard parties’ future relationship because in ADR there is no winner or loser, but what parties seek for is a compromise. This is done by encouraging parties to talk freely in a neutral, none-threatening and confidential relationship . However, sceptics such as Marian Roberts argue that the very advantage of confidentiality, informality can lead to manipulative and oppressive behaviour during the due process .This can be said to be a weak argument since the neutral third party is there to ensure justice, fair play, and a good understanding between parties which will facilitate a good outcome of the case for the benefits of both parties.
A strong disadvantage relating to the criticisms of ADR is the view that alternative forms of dispute resolution offer only a ‘second rate’ version of the law. It has been stated that tribunals, arbitration and mediation do not extend the full rights of the law to parties. It is possible for tribunal’s decision to be overruled if the point of law by which the decision was made was made in error. This has often caused costs and time of the case to increase. This directly contradicts with the nature of the courts and Lord Woolf’s ideals of improving the efficiency of the court. If ADR becomes the precursor to legal proceedings then it is not assisting the court and further burdens the parties with higher legal costs, which is not the aim of the reform.
Another disadvantage as argued by some of commentators such as Fiss, is the idea that ADR does not serve best when there is financial imbalance between parties. Fiss argues that ADR does not protect litigants with less financial resources since it exposes them to pressures of settling the dispute in need for money. In addition, he stresses that, strong parties will have unfair advantages of being able to gather and analyse the information necessary to gain a reasonably accurate picture of the probable outcome so they have a baseline from which to bargain . However, Mc Thenia and Shaffer have criticised Fiss’s first argument on the ground that ‘Fiss assumes that ADR movement is one that wants peace at any price’. In their view settlement is neither an avoidance mechanism nor a truce, but rather is a process of reconciliation in which the anger of broken relationship is to be confronted rather than avoided, and in which healing demands not a truce but confrontation . However, one important setback of ADR that one can point out without being disputed is the fact that, ADR does not work in all types of disputes.
Another issue to address with particular reference to lawyers is the implications of a rising usage of ADR which threatens the monopoly of legal knowledge. Particularly in ADR regarding mediation were it is not necessary for parties to use lawyers, the demand for lawyers will decline. This could have an adverse effect of causing costs to rise for lawyers if they try to spread their costs over other cases, because of the loss of clientele, and thus spread fees over fewer cases. However, another view is that this could be beneficial in forcing the law profession to become more competitive and lower fees which should aim to improve the efficiency of the courts if lawyers are more affordable to parties.
The courts have encouraged ADR through altering the precedent of costs in civil procedure. There are sanctions for parties who unreasonably refuse to pursue ADR such as mediation by having the normal right for the loser to pay the legal fees waived. In Dunner v Railtrack plc (2002),the CA held that if a party rejected ADR when it had been suggested by the court, they would suffer the consequences when ‘costs’ came to be decided. This shows how the courts are willing to encourage ADR and again reduce excessive litigation. This precedent however could act as a double edged blade. Whilst it encourages parties to mediate it could also be used by parties tactically who believe that if there is a strong possibility of the party losing in court may suggest mediation as a way of protecting themselves by having the court sanction the winning party if they refuse ADR. The fact that the courts are encouraging ADR also contradicts the access to justice which is a court’s duty and is bound to perform. If the courts are encouraging action outside of trial then this raises questions as who may bring a claim to trial.
There are different types of ADR, the variation of which can be reflected on the nature, and strengthens of each type. Executive tribunal is a voluntary, quick and effective form of ADR mostly used in commercial matters, whereby parties present their case to executives who then evaluate the respective claims . Another type of ADR is mediation. As defined by Charters Institute of Arbitrators, mediation means ‘... a private and constructed form of negotiation assisted by a third party that is initially none binding’. Mediation is one of the best ADR process because it can be used in all types of disputes, at any stage even during the trial . It is voluntary, informal, quick and cheaper, but both parties have to be willing to use it. It is worth noting that, conciliation can be said to be a form of mediation, because in conciliation, a mediator is by then adopting an evaluative approach. However, as provided by the Chartered Institute of Arbitrators, the major difference between the two is; ...a conciliator investigates the facts, attempts to reconcile the opposing contentions of the parties and prompts them to come up with their own proposal for settlement. He does not make recommendations but acts as a catalyst for settlement by the parties themselves . Conciliation serves best in employment disputes.
Another important type of ADR is expert determination. It is a binding but voluntary process, whereby parties jointly instruct and make submissions to a senior judge (mostly retired), who then makes a written appraisal . The decision of an expert can be challenged only if the expert has materially departed from his instructions . It serves best in ongoing contracts . Lastly, it is arbitration. Arbitration involves a specialist arbiter who hears and decides the case, in a private environment, whereby the decision of an arbiter is binding and can be enforces through courts as stressed in the Arbitration Act 1950, s. 26. However, arbitration has some negative features; it is expensive since you have to use an expert arbitrator and it is time consuming. This type of ADR is mostly used in Construction and Engineering claims.
Despite being stressed and agreed in the contract that in case of any dispute, parties will resolve their disputes exclusively by the determination of an expert, this method will not be suitable to our client. Expert determination has some major problems; first it is harder to challenge a none-speaking expert determination, and if there is a need for a speaking determination where an expert gives reasons, this can appear to be more expensive. Expert determination is also only suitable for ongoing contracts. As such, we would recommend the adoption of mediation due to the following reasons; mediation can be arranged quickly and cheaper than trial proceedings and other ADR forms. Furthermore, mediation can be used at any stage of the process, this means we can use it before, or even during the trial. Mediation is also good to our client because it serves best to any kind of dispute, and unlike arbitration where the decision of an arbitrator regardless of shortcomings to our client, cannot be challenged easily. Mediation also ascertains what our opponent really wants and the range of remedies are wide.
However, we shall need the expert’s report to help the mediator assessing the responsibility and value. The following things have to be done so as to go through mediation; First the parties has to agree on the appointment of a mediator who has special skills. In relation to procedural steps, first mediator will write to the parties giving full details of the case, that is location, parties, lawyers, costs, and duration, and his specific requirements of documents. Parties will then send documents, and before the actual day of mediation there will be a preliminary discussion with mediator so as to know each other. In the mediation day, first, there will be an initial joint meeting (short openings given), followed by private sessions (parties speak to mediator privately). Then negotiations will be called upon in the joint meeting, followed by a settlement (once signed, it becomes binding).