ADR: What's ADR and How does it Work?
"Alternative Dispute Resolution" Process & Definition
Who's involved in ADR:
ADR is typically handled by attorneys, lawyers, counsel and judges (or former judges). ADR has been made famous by mediators like Judge Judy, who hosts a nationally syndicated show. But the reality is most of ADR takes place inside confidential court rooms by hired and trained professionals to settle both civil, commercial, and family disputes.
What does ADR include:
ADR includes both mediation and arbitration, and is also referred to in family law as "collaborative law."
Where does ADR happen:
ADR takes place in court rooms, vis-a-vis contracts, and is often mandated by judges as a way to clear the court systems of unnecessary lawsuits.
When do people settle cases through ADR:
Every day, it's estimated that nearly 2,500 cases are settled across America. This estimate is just from the number of cases that are officially filed as lawsuits - there are plenty of times in which a case isn't filed, and attorneys work for resolution prior to an actual court filing.
How does ADR work:
ADR can be either binding (Arbitration) or non-binding (Mediation).
Why would you choose ADR?
Most business people would prefer settling a lawsuit before it goes to trial. The costs of a lawsuit almost always greatly outweigh the benefits. Therefore, choosing ADR - mediation and arbitration - makes sense in about 99% of the cases. ADR is growing rapidly, and we encourage you to get in touch with our team to settle your own disputes through Alternative Dispute Resolution.
Alternative Dispute Resolution - Tips to Know about the ADR & lawsuit resolution Process
Alternatives to lawsuits like mediation and arbitration are becoming increasingly popular. Panelists at panel discussing bankruptcy proceedings noted a rise in the use of mediation in resolving the labyrinth of financial and legal issues in the matter. A 2012 article in the Denver Post noted that more people are using mediation to help resolve financial matters in divorce in increasing numbers. More companies are including mandatory arbitration clauses in their contracts, a move supported by the US Supreme Court as just another agreement between parties rather than a tactic to avoid litigation.
Yet as parties appear to be agreeing to handle their disputes in a non-adversarial way, the process of mediation and arbitration is anything but non-adversarial. Lawyers are using arbitration as a mini-trial rather than an alternative to litigation, and mediation is taking on characteristics of arbitration, as more lawyers get involved. Professor Jacqueline Nolan-Haley notes in her article in the Harvard Negotiation Law Review that lawyers increasingly represent clients as advisors in mediation and act as zealous advocates in arbitration, giving both alternatives to litigation a very litigious flavor.
Lawyers and laypersons alike should be aware of this trend in alternative dispute resolution and try to use it to their advantage to win disputes.
Tip #1 Move quickly when arbitration is likely
It is well accepted that people remember what they hear first. In law school, the moot court instructor teaches you juries retain what they hear first. So then the arbitrator may react in the same way. Move quickly when arbitration is a serious possibility, and present your case, supported by the facts, in the demand for arbitration.
Tip #2 Using the expense of arbitration to your advantage
Many assume that it’s cheaper to use arbitration to resolve disputes compared to the cost of filing a lawsuit. However, the costs of arbitration are initially higher than filing a suit according to research performed by watchdog group Public Citizen. A survey by two attorneys published online at Inside Counsel shows that even in the long term, arbitration is more costly. Usually two parties, the arbitrator and the party in the best financial position, find it in their interest to extend arbitration, while the courts are interested in a quicker resolution to unclog a busy docket. Fees can pile up; the arbitrator will charge both parties to hear motions and oversee discovery, items usually built in to the fees of one part or another.
A party to an arbitration may consider the use of the best arbitrator available; those persons usually have the highest price tag. This will add to the upfront costs, costs that may add up to dissuade the opposing party from going forward.
Discovery motions, motions to dismiss and other issues normally handled by a judge and at a low cost in court become expensive add-ons during the arbitration process. If your side can withstand the financial burden, the opposition may not be.
Tip #3 Take advantage of the arbitrator needing your business
While all arbitrators are above board and ethical, the prospect of future business may play a role in their award decisions. An arbitrator may not wish to offend a powerful law firm or client because the arbitrator wants to be hired again. He or she will follow the law in deciding who wins and loses, yet may be more temperate in awarding damages.
Tip #4 Effective use of a lawyer in mediation
Mediation was traditionally an opportunity for both parties to sit across from each other and hammer out differences. Today, some parties hire an attorney to assist them in the negotiation process. A good mediation attorney understands how to use the procedure to your advantage, as the rules that apply to the arbitration process or a trial don’t apply to mediation. A mediator who is not a trial attorney or judge may not be able to resist such things as the introduction of evidence normally excluded at trial. Many mediators will have extensive legal experience and will, for example, give reduced weight to hearsay evidence even though they accept it.
Be wary of a lawyer who treats the mediation dispute resolution process with less import than other more formal proceedings. Even a mediator who lacks courtroom experience will notice disdain.
Tip#5 Know the arbitrator or mediator before hiring them
Mediation and arbitration are becoming lucrative enough for attorneys and retired judges to advertise their services as the adjudicator in hearings. Just as it is important to pick the right jury, it’s important to pick the right arbitrator or mediator. If you’re participating in a hearing resulting from a mandatory arbitration clause, the arbitrator may have already been selected. If not, you may have to pick someone. While it may be helpful to pick a former SEC chair as the arbitrator in a bankruptcy proceeding, it may be best to simply select the most experienced arbitrator available, someone who will provide the most equitable decision.
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