NEW LAW COLLEGE

Name: Karishma Nilesh Shah

Class: T.Y.LLB ‘D’

Roll No.: 349

Subject: Alternate dispute resolution system

 Table of contents

Page
Topic
Number
Introduction 3
What is alternative dispute resolution 4
Key Features 5
Types 6
Advantages and Disadvantages 10
Conclusion 11

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1. INTRODUCTION

Alternative dispute resolution (ADR) (also known as external dispute resolution in some countries, such
as Australia[1]) includes dispute resolution processes and techniques that act as a means for disagreeing
parties to come to an agreement short of litigation. It is a collective term for the ways that parties can
settle disputes, with (or without) the help of a third party. Despite historic resistance to ADR by many
popular parties and their advocates, ADR has gained widespread acceptance among both the general
public and the legal profession in recent years. In fact, some courts now require some parties to resort to
ADR of some type, usually mediation, before permitting the parties' cases to be tried (indeed the
European Mediation Directive (2008) expressly contemplates so-called "compulsory" mediation; this
means that attendance is compulsory, not that settlement must be reached through mediation). The rising
popularity of ADR can be explained by the increasing caseload of traditional courts, the perception that
ADR imposes fewer costs than litigation, a preference for confidentiality, and the desire of some parties
to have greater control over the selection of the individual or individuals who will decide their dispute.
Some of the senior judiciary in certain jurisdictions (of which England and Wales is one) are strongly in
favour of this (ADR) use of mediation to settle disputes. 1Alternative Dispute Resolutions ("ADR") are
alternative methods that; an independent, objective and impartial third party provides the parties of the
legal dispute to reach an agreement about the dispute by bringing them together and communicating with
each other. Dispute resolution in Turkey is a fundamental duty of State. For any dispute arising from a
legal relationship between the concerned parties, application to the state courts is the initial and essential
judicial remedy.

ADR have come up as an option for providing cost and time efficiency as compared to the judicial
proceedings before state courts and for averting the disadvantages of the latter. ADR are optional dispute
resolution proceedings and methods as compared to proceedings before State Courts. ADR aims simpler
and faster resolution of the disputes without impairing the judicial sovereignty of the state. Any method of
resolving disputes other than by litigation.  Abbreviated as ADR.  Public courts may be asked to review
the validity of ADR methods, but they will rarely overturn ADR decisions and awards if the disputing
parties formed a valid contract to abide by them.  Arbitration and mediation are the two major forms of
ADR.

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Alternative Dispute Resolution ("ADR") refers to any means of settling disputes outside of the courtroom.
ADR typically includes early neutral evaluation, negotiation, conciliation, mediation, and arbitration. As
burgeoning court queues, rising costs of litigation, and time delays continue to plague litigants, more
states have begun experimenting with ADR programs. Some of these programs are voluntary; others are
mandatory.2

2. WHAT IS ALTERNATIVE DISPUTE RESOLUTION (ADR)?

ADR is a term used to describe several different methods of resolving legal disputes without going to
court. The rising cost of litigation is making traditional lawsuits impractical for many individuals and
businesses. At the same time, civil courts face backlogged dockets, resulting in delays of a year or more
for private parties to have their cases heard by a jury. New types of proceedings have been developed in
response, and they are proving beneficial, saving time and money for everyone involved. These include
arbitration, mediation, and additional kinds of ADR designed for specific cases and subject matters.

The basic goals of ADR include:

1. To create a speedier and more efficient forum in which to resolve civil disputes;
2. To lower the costs of the arbitration process, which continue to rise under the present system;
3. To reduce overcrowding in the public courts;
4. To allow the parties involved in the dispute greater control over the resolution process;
5. To provide a more confidential forum of debate;
6. And, to allow the mediator and the parties involved to work more closely together toward a satisfactory
resolution.

Obviously, this list is not all–inclusive, but it provides a basic framework of what exactly alternative
dispute resolution seeks to accomplish.3

The term can refer to everything from facilitated settlement negotiations in which disputants are
encouraged to negotiate directly with each other prior to some other legal process, to arbitration systems
or minitrials that look and feel very much like a courtroom process. Processes designed to manage
community tension or facilitate community development issues can also be included within the rubric of
ADR. ADR systems may be generally categorized as negotiation, conciliation/mediation, or arbitration
systems. Negotiation systems create a structure to encourage and facilitate direct negotiation between
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parties to a dispute, without the intervention of a third party. Mediation and conciliation systems are very
similar in that they interject a third party between the disputants, either to mediate a specific dispute or to
reconcile their relationship. Mediators and conciliators may simply facilitate communication, or may help
direct and structure a settlement, but they do not have the authority to decide or rule on a settlement.
Arbitration systems authorize a third party to decide how a dispute should be resolved. It is important to
distinguish between binding and non-binding forms of ADR. Negotiation, mediation, and conciliation
programs are non-binding, and depend on the willingness of the parties to reach a voluntary agreement.
Arbitration programs may be either binding or non-binding. Binding arbitration produces a third-party
decision that the disputants must follow even if they disagree with the result, much like a judicial
decision. Non-binding arbitration produces a third-party decision that the parties may reject.4

3. KEY FEATURE OF ALTERNATIVE DISPUTE RESOLUTION

APPROCHES

Alternative Dispute Resolution comprises various approaches for resolving disputes in a non-
confrontational way, ranging from negotiation between the two parties, a multiparty negotiation, through
mediation, consensus building, to arbitration and adjudication the report introduces the key skills
required, with particular attention to their important role in the process of negotiation and mediation, with
examples of their application in national and international water conflicts. Conflict is endemic to human
society, among individuals and groups, and it is important to manage it. We find stories in the Bible, in
the Islamic culture, among Native Americans, First Nations in Canada, and many other traditions that
describe processes that have been used from the earliest times to find peaceful solutions to various
disputes, and much can be learned from the past. In recent decades, the various conflict resolution
approaches have become a widely accepted field both of academic study and of practice, with official
and/or legislative functions in many countries. In international relations, they play an increasing role in
containing, managing, and resolving potential sources of conflict. The report reviews its complex
development. While conflict can be dangerous, it also carries the possibility of producing creative
cooperation in a win–win solution. The key to this is for participants to engage as joint problem solvers,
seeking to resolve the dispute, and to try and “enlarge the pie” rather than acting as adversaries and
aggravating the situation. Alternative Dispute Resolution is of two historic types. First, methods for
resolving disputes outside of the official judicial mechanisms. Second, informal methods attached to or
pendant to official judicial mechanisms. There are in addition free-standing and or independent methods,
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such as mediation programs and ombuds offices within organizations. The methods are similar, whether
or not they are pendant, and generally use similar tool or skill sets, which are basically sub-sets of the
skills of negotiation.

ADR includes informal tribunals, informal mediative processes, formal tribunals and formal mediative
processes. The classic formal tribunal forms of ADR are arbitration (both binding and advisory or non-
binding) and private judges (either sitting alone, on panels or over summary jury trials). The classic
formal mediative process is referral for mediation before a court appointed mediator or mediation panel.
Structured transformative mediation as used by the U.S. Postal Service is a formal process. Classic
informal methods include social processes, referrals to non-formal authorities (such as a respected
member of a trade or social group) and intercession. The major differences between formal and informal
processes are (a) pendency to a court procedure and (b) the possession or lack of a formal structure for the
application of the procedure.

For example, freeform negotiation is merely the use of the tools without any process. Negotiation within a
labor arbitration setting is the use of the tools within a highly formalized and controlled setting.5

A mediator can play a valuable role in this process, facilitate a negotiation process which has come to a
dead end, helping the parties concerned to focus on their essential interests rather than defend (or attack)
fixed positions. The principles and procedures of consensus building are dealt with in some detail. The
report outlines the principles of negotiation, based on interests and needs of the parties, the use of proper
communication, and maintenance of a working relationship as an essential component for reaching a
durable agreement. It lists and considers the essential skills needed by negotiators and mediators, and
points the different cultural expectations (national, regional, religious, or professional) and the
psychological aspects that affect perceptions and communications. It outlines a range of strategies for and
approaches to mediation, and the ethical problems that may arise. ADR traditions vary somewhat by
country and culture. There are significant common elements which justify a main topic, and each country
or region's difference should be delegated to sub-pages.

4. TYPES OF ALTERNATIVE DISPUTE RESOLUTION

The main types of ADR that deal with consumer disputes are conciliation, arbitration or mediation and
are usually provided by trade associations. If you wish to use one of these schemes, you should ask the

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suppliers whether they are members of a trade association and, if so, contact the trade association to find
out whether it has a conciliation and/or arbitration service. Some trade associations are part of the Trading
Standards Institute Consumer Codes Approval Scheme (CCAS). Any traders who are part of this scheme
agree to provide good standards of service and must provide ADR for disputes between consumers and
traders.

CONCILITION

In consumer disputes, conciliation is the first stage in the arbitration process and the conciliator is usually
a member of the trade association. Both you and the supplier will be asked to give written details of the
complaint, including any evidence, and the conciliator will give an opinion on the best solution. Any
decision is not binding and won't prevent you from taking court action. If you disagree with the opinion
offered, you can then proceed to the arbitration stage or consider suing in court. There is usually no
charge for conciliation. In conciliation, the resolution of the dispute by the parties themselves is the
essential point.

In opposition to the mediation method, conciliation is based on right and rightfulness and the history of
the dispute is taken into consideration. At the same time, conciliation method is less flexible than
mediation method and is mostly based on provisions of law.

NEGOTIATION

Negotiation is a type of ADR which is generally referred to initially in case of a dispute and it covers all
methods of ADR. This type of ADR aims for the parties to settle the dispute between the same by
negotiating and deliberating with each other with the attendance of their attorneys if needed, without
intervention of any third party.

Negotiation is a kind of ADR method that each party tries to obtain a benefit for themselves at the end of
the process by persuading the other party to act in the way the former desires.

ARBITRATION

While arbitrations are technically voluntary, many people agree to participate in arbitrations before a
dispute even arises.   For example, many formal contracts require that any dispute arising out of the
contract be arbitrated. In an arbitration, the parties agree to have their case heard by an impartial person,
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the arbitrator, who issues a final and binding decision. Typically, an arbitration case is heard much faster
than a court case would be heard and is less expensive than a formal litigation. It is the process of
referring a dispute to an impartial intermediary chosen by the parties who agree in advance to abide by
the arbitrator’s award that is issued after a hearing at which all parties have the opportunity to be heard.
Arbitration resembles traditional civil litigation in that a neutral intermediary hears the disputants’
arguments and imposes a final and binding decision that is enforceable by the courts. One difference is
that in arbitration the disputants elect to settle any
future disputes by arbitration before a dispute arises, whereas with civil litigation the judicial system is
generally chosen by a disgruntled party after a dispute has materialized. Another difference is that the
disputants to an arbitration select the intermediary who will serve as arbitrator, whereas parties to civil
litigation have little to no control over who will preside as the judge in judicial proceedings. Arbitration is
a procedure for settling disputes in which both you and the supplier usually agree to accept the decision of
the arbitrator as legally binding. This means you cannot take court action, except to enforce the award if
the supplier doesn't pay. The arbitrator will usually be a member of the Chartered Institute of Arbitrators
and often acts independently of the trade association. The arbitrator will make a decision based on the
written evidence presented by you and the supplier. The decision is confidential and cannot be made
public without the supplier's agreement. You will have to pay a registration fee which may be refunded if
you are successful. Some contracts for services and delivery notes include an arbitration clause stating
that you will refer any dispute to arbitration. Although this is binding once you have signed the
agreement, if the total cost is below the small claims limit (£10,000), you cannot be forced to arbitrate
unless you gave your agreement after the dispute arose.

MEDIATION

In mediation, an independent mediator works with the parties to come to a resolution. Mediators are
trained professionals who are able to help the parties communicate and accept a fair resolution of their
dispute. A mediator does not have the authority to impose a solution on the parties. If the mediation is
successful, then the parties will sign a legally enforceable mediation agreement to which they each agree
to abide. If the mediation is ultimately unsuccessful then the parties will fail to reach an agreement and
can take their dispute to court.
Mediation is a rapidly growing ADR technique. It consists of assisted negotiations in which the disputants
agree to enlist the help of a neutral intermediary, whose job it is to facilitate a voluntary, mutually
acceptable settlement. A mediator’s primary function is to identify issues, explore possible bases for

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agreement, discuss the consequences of reaching impasse, and encourage each party to accommodate the
interests of other parties through negotiation. However, unlike arbitrators, mediators lack the power to
impose a decision on the parties if they fail to reach an agreement on their own.
Mediation is sometimes referred to as conciliation, or conciliated negotiation. However, the terms are not
necessarily interchangeable. Conciliation focuses more on the early stages of negotiation, such as opening
the channels of communication, bringing the disputants together, and identifying points of mutual
agreement. Mediation focuses more on the later stages of negotiation, exploring weaknesses in each
party’s position, investigating areas where the parties disagree but might be inclined to compromise, and
suggesting possible mutually agreeable outcomes. Conciliation and mediation typically work well when
the disputants are involved in a long-term relationship, such as husband and wife, wholesaler and retailer,
and manufacturer and distributor, to name a few. Mediation and conciliation also work well for
"polycentric" problems that are not easily solved by all-or-nothing solutions, as with certain antitrust suits
involving a myriad of complex issues.
Although some jurisdictions have enacted statutes that govern mediation, most mediation proceedings are
voluntary for both parties. Accordingly, a mediator’s influence is limited by the autonomy of the parties
and their willingness to negotiate in good faith. Thus, a mediator can go no further than the parties
themselves are willing to go. Since agreements reached by mediation bear the parties’ own imprint,
however, many observers feel that they are more likely to be adhered to than decisions imposed by an
arbitrator or court. Disputants who participate in mediation without representation of legal counsel are
also more likely to adhere to settlements when the alternative is to pursue civil litigation, where attorney’s
fees consume a significant portion of any monetary award granted to the parties.
If you use a mediation scheme, the mediator will help you and the supplier to negotiate an acceptable
agreement and will act as a go between if you don't want to meet. If the supplier agrees to mediation, you
will both be asked to give details of the dispute, including copies of any evidence and will be asked to
sign a mediation agreement giving a framework for the mediation. The mediator may arrange joint or
separate meetings with you and the supplier and will help you to identify the strengths and weaknesses in
your case.

MINITRIALS

A minitrial is a process by which the attorneys for the parties present a brief version of the case to a panel,
often comprised of the clients themselves and a neutral intermediary who chairs the process. Expert
witnesses (and less frequently, lay witnesses) may be used in presenting the case. After the presentation,
the clients, normally top management representatives who by now are more aware of the strengths and
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weaknesses of their positions, attempt to negotiate a settlement of the dispute. If a negotiated settlement is
not reached, the parties may allow the intermediary to mediate the dispute or render a non-binding
advisory opinion regarding the likely outcome of the case were it to be tried in civil court.

Minitrials are often effective because they usually result in bringing top management officials together to
negotiate the legal issues underlying a dispute. Early in the negotiation process, upper management is
sometimes pre-occupied by the business side of a dispute. Minitrials tend to shift management's focus to
the outstanding legal issues. Minitrials also allow businesses to share information with each other and
with their attorneys, providing a forum for initial face-to-face negotiations. Management also generally
prefers the timesaving, abbreviated nature of minitrials over the more time-consuming and costly civil-
litigation alternative. Minitrials expedite negotiations as well, by making them more realistic. Once the
parties have seen their case play out in court, even in truncated fashion, the parties are less likely to
posture over less relevant or meaningless issues.

5. ADVANTAGES & DISADVANTAGES OF ALTERNATIVE

DISPUTE RESOLUTION

There are many advantages, and some disadvantages, to using Alternative Dispute Resolution.

Advantages include the fact that it usually takes far less time to reach a final resolution than if the matter
were to go to trial. Usually (but not always), it costs significantly less money, as well. Furthermore, in the
case of arbitration the parties have far more flexibility in choosing what rules will be applied to their
dispute (they can choose to apply relevant industry standards, domestic law, the law of a foreign country,
a unique set of rules used by the arbitration service, or even religious law, in some cases.).

The parties can also have their dispute arbitrated or mediated by a person who is an expert in the relevant
field. In an ordinary trial involving complicated and technical issues that are not understood by many
people outside a relevant industry, a great deal of time has to be spent educating the judge and jury, just
so they can make an informed decision. This large time investment often translates into a great deal of
money being spent. Both sides might have to call expert witnesses, who may charge very large fees for
their time. If an arbitrator has a background in the relevant field, however, far less time needs to be spent
on this, and the parties can get to the actual issues of the case much sooner.

There are some disadvantages, as well. Generally, arbitrators can only resolve disputes that involve
money. They cannot issue orders requiring one party to do something, or refrain from doing something
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(also known as injunctions). They cannot change title to property, either. Also, some of the safeguards
designed to protect parties in court may not be present in ADR. These might include the liberal discovery
rules used in U.S. courts, which make it relatively easy to get evidence from the other party in a lawsuit.

Also, there is very limited opportunity for judicial review of an arbitrator's decision. While a large
arbitration service could, if it so chose, have some kind of process for internal appeals, the decision is
usually final and binding, and can only be reviewed by a court in limited cases. This generally happens
when the original arbitration agreement is found to be invalid. Because both parties must voluntarily
agree to arbitration, if the consent of one party is obtained by fraud or force, it will not be enforced. Also,
if the decision of the arbitrator is patently unfair, it will not be enforced. This is a difficult standard to
meet. The fact that the arbitrator made a decision that the court would not have made is not, by itself, a
basis to overturn the decision.

A court might also overturn an arbitrator's decision if it decided issues that were not within the scope of
the arbitration agreement.6

6. CONCLUSION

Alternative Dispute Resolution ("ADR") refers to any means of settling disputes outside of the courtroom.
ADR typically includes early neutral evaluation, negotiation, conciliation, mediation, and arbitration. As
burgeoning court queues, rising costs of litigation, and time delays continue to plague litigants, more
states have begun experimenting with ADR programs. Some of these programs are voluntary; others are
mandatory.
A wide variety of processes, practices, and techniques fall within the definition of "alternative dispute
resolution." Arbitration and mediation are the best known and most frequently used types of ADR, but not
the only ones. Minitrials, early neutral evaluations, and summary jury trials are less well-known forms of
ADR. Many of these ADR techniques have little in common except that negotiation plays a prominent
role in each. Parties to ADR procedures generally agree that a negotiated settlement is worth pursuing
before investing time and money in full blown civil litigation.
The procedures and techniques discussed above are the most commonly employed methods of ADR.
Negotiation plays an important role in each method, either primarily or secondarily. However, there are
countless other ADR methods, many of which modify or combine the above methods. For example, it is
not uncommon for disputants to begin negotiations with early neutral evaluation and then move to

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nonbinding mediation. If mediation fails, the parties may proceed with binding arbitration. The goal with
each type of ADR is for the parties to find the most effective way of resolving their dispute without
resorting to litigation. The process has been criticized as a waste of time by some legal observers who
believe that the same time could be spent pursuing the claims in civil court, where negotiation also plays a
prominent role and litigants are protected by a panoply of formal rights, procedures, and rules. But many
participants in unsuccessful ADR proceedings believe it is useful to determine that their disputes are not
amenable to a negotiated settlement before commencing a lawsuit.
Despite its success over the past three decades, ADR is not the appropriate choice for all disputants or all
legal disputes. Many individuals and entities still resist ADR because it lacks the substantive, procedural,
and evidentiary protections available in formal civil litigation. For example, parties to ADR typically
waive their rights to object to evidence that might be deemed inadmissible under the rules of court.
Hearsay evidence is a common example of evidence that is considered by the parties and intermediaries
in ADR forums but that is generally excluded from civil trials. If a disputant believes that he or she would
be sacrificing too many rights and protections by waiving the formalities of civil litigation, ADR will not
be the appropriate method of dispute resolution.

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