What is ADR ?
ADR is a term that refers to several different methods of resolving disputes outside traditional legal and administrative forums. The main ADR alternatives to civil litigation are arbitration, conciliation and mediation. Disputing parties use these ADR methods because they are expeditious, private and generally much less expensive than a trial. Mediation is a concept that is often mistakenly confused with conciliation. Although the two methods have similar aspects, they are fundamentally different. To appreciate the differences between arbitration, mediation, and conciliation, it is helpful to explain them separately.
What is Arbitation ?
Arbitration is an ADR method where the disputing parties present their disagreement to one arbitrator or a panel of private, independent and qualified third party “arbitrators”. The arbitrator(s) determine the outcome of the case. While it may be less expensive and more accessible than trial, the arbitration process has well-defined disadvantages. Some of disadvantages include the formal or semi-formal rules of procedure and evidence as well as the potential loss of control over the decision by the parties after transfer of decision-making authority to the arbitrator.
What is mediation ?
Mediation is an ADR method where a neutral and impartial third party, the mediator, facilitates dialogue in a structured multi-stage process to help parties reach a conclusive and mutually satisfactory agreement. A mediator assists the parties in identifying and articulating their own interests, priorities, needs and wishes to each other. Mediation is a “peaceful” dispute resolution tool that is complementary to the existing court system and the practice of arbitration.
The purpose of ADR.
Alternate Dispute Resolution is simply an alternate route for resolving disputes between parties, not necessarily seeking justice or penalty for any illegality or wrongdoings, but rather solutions to the problems in hand. But what is it really an ‘alternate’ to? Solutions? Not quite. From a practical standpoint, its main purpose is to serve as a mitigating factor to the primary cons relating to the current legal system, and specifically to the only option that disputing parties can see, that is ‘litigation’. So, ADR acts as an alternate to litigation.