Opinions Matter
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Laura Odlind: “The use of mediation can mean it’s easier for parties to preserve their relationship.” How and why is Alternative Dispute Resolution becoming so prevalent in the contentious legal landscape?
There are 11 opinions, see below
Laura Odlind
Laura specialises in both commercial and residential property litigation matters. She has a wealth of experience in landlord and tenant issues covering consents, business lease renewals, dilapidations, rent arrears recovery and service charge disputes.
Laura believes that forms of Alternative Dispute Resolution such as mediation or expert determination can be more conducive to resolving disputes than a more adversarial approach. What role do you think Alternative Dispute Resolution has to play?
2011 opinions are now closed for further comment.
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I agree with Laura, however, I would put greater emphasis on the last part of her argument – that ADR should be cautiously exercised. I don’t believe that ADR techniques such as mediation, arbitration or expert determination are, in all scenarios, more conducive than an adversarial approach.
In my opinion, cases should be assessed and ushered towards either an adversarial or ADR route. The deciding factor being both parties inclination to the use of ADR.
ADR techniques do have many advantages. ADR has been demonstrated to be considerably cheaper, and in many ways more cost-effective, providing longer lasting agreements, which were facilitated with less conflict and more co-operation (J.B. Kelly, 2004). Given the current economic climate and as Laura highlighted, the backlog of cases, it is therefore easy to see why ADR is being embraced by the Government.
The arguments for ADR are convincing, however, whilst it is easy to see ADR as a panacea, there is strong evidence that ADR is largely reliant on cooperation (Bickerdike and Littlefield, 2000). If parties are encouraged to use ADR, when one or both are uncomfortable doing so, then its chances of success are severely depleted. One of the ramifications of this is higher costs. Upon failure, both the initial practitioner used for the ADR and the subsequent solicitors must be financed. Meanwhile, the parties may be further damaged by the failed ADR and the timeline of reaching an agreement is naturally prolonged.
Secondly, for example in family law, there are many situations where a client may prefer to have a solicitor employed to solely protect their interests. This may be the case in situations involving domestic violence, abuse or a power imbalance.
Overall, I agree with Laura that mediation is an important route to consider. Both avenues have their risks and it is a difficult task knowing which route to take.
Alternative Dispute Resolution (ADR) has an increasing role to play in today’s legal environment because the advantageous of using such methods outweigh any disadvantages for clients.
ADR is the process of using mediation techniques to resolve problems outside of the courtroom. These methods are often more beneficial to a client than litigation for a number of reasons.
Firstly, the costs of litigation are extremely high and in this economic climate clients are looking for more efficient and cost effective ways to resolve disputes. ADR provides the answer to this problem as it is much less expensive. It is also constitutional to provide inexpensive alternatives to litigation as the rule of law calls for justice to be accessible and therefore affordable.
Secondly, ADR is more flexible and allows for more creative and bespoke solutions to be reached. This was acknowledged in Halsey v Milton Keynes General NHS Trust where it was stated mediation could provide for numerous solutions including apology, explanation or the continuation of a relationship on different terms. The court has also acknowledged in O’Connor v Lenhian that an apology can be much more effective than an award of damages in easing feelings of anger or distress. Parties are also free to choose their own mediator who will often be an expert in the area of dispute which will ensure a more informed remedy will be given.
Due to the flexibility of ADR and the high degree of client involvement, ADR can be much more satisfying than litigation as the parties have a higher degree of control over the outcome. Furthermore, if a satisfactory solution cannot be reached, the parties can still go to court.
Thirdly, ADR is particularly advantageous for commercial parties as proceedings are conducted in private. This ensures business matters are kept out of public scrutiny which prevents bad press from damaging the client’s or company’s reputation.
All of these reasons contribute towards the preservation of relationships which, for obvious reasons, is important for commercial parties.
However, there are also disadvantages to ADR which should be considered before deciding whether ADR is appropriate for a specific case.
If there is an urgent need, for example, ADR would be inappropriate as it can take a long period of time. Furthermore, if parties decide to use a binding form of ADR they assume the risk of getting an unfavourable outcome to which there is rarely an appeal. In the wider context, increased use of ADR over litigation will result in a decrease in the progression of case law which, to a degree, could inhibit the development of the law.
Whilst ADR certainly has its advantages, different resolution techniques will be required depending on the context of the given case. However, courts have adopted the practice of staying proceedings until mediation has taken place and inflicting cost penalties on parties who turn down the opportunity to mediate. This clearly illustrates the prevailing attitude within the legal community that ADR is more beneficial than litigation.
Alternative Dispute Resolution (“ADR”)
Alternative Dispute Resolution (“ADR”) is a process where the courts system is avoided, as far as may be possible to do so. ADR is also referred to a mediation or arbitration. All parties to an arbitration agreement must insure that they are signatories to the London Court of International Arbitration (LCIA) or signatories to the New York Convention on the Recognition and Enforcement of Foreign Arbitral awards (NY Convention)
Parties to an ADR should be concerned with the flexibility, privacy, enforceability and cost of the ADR process.
In court hearings the fact that proceedings are public will mean that any dispute which arises and is resolved in, will attract negative publicity. Parties to ADR would be particularly concerned about preserving the company’s reputation in this respect; therefore confidentiality is paramount. Parties should be advised about the benefits arbitration. An arbitration clause is created and defined by agreement the parties and consequently can be drafted reflect and keep any disputes related proceedings private and confidential. The distinction between both must be noted relates to the exclusion of members of the public from observing the proceedings and confidentiality governs the non-disclosure of the proceedings and outcome by the parties.
Parties to ADR should be made aware that despite agreement of privacy and confidentiality within the ADR clause. There are means by which any dispute may be drawn into the public arena by order of the courts.
If parties to the ADR are located overseas, it is paramount that the resolution to any dispute is enforceable in the country of the respective service providers. Adjudication would be less advantageous in this respect as enforceability would be subject to that countries rules relating to conflict of laws. As most, if not all European states are signatories to the New York Convention on the Recognition and Enforcement of Foreign Arbitral awards (NY Convention), that any award favour of parties will likely be enforceable against his foreign supplier. The NY Convention dictates that courts of contracting states give effect to private agreements to arbitrate and recognise and enforce awards made in other states. Enquiries should be made to confirm that each country in which his suppliers are located all to the NY Convention.
The fact that a newly establishment business verses a well established business, may mean that it may not have the required capital to withstand a costly drawn out litigation process; again making ADR/arbitration which is said to be a more affordable process more attractive.
Parties to ADR should be advised that although arbitration may on its face appear to be quicker and more cost effective than adjudication; in practice its expediency and cost will be dependent on the will of the parties to proceed effectively. There are many factors which affect both and there is a direct correlation between length of the process and how much it will end up costing i.e., availability of the arbitrator/ tribunal, ability to appeal the tribunals decision and utilisation of recourse to the courts (e.g. requests for orders/appeals etc.)
Considerations which would affect costs include the cost of the tribunal which will be borne by the parties to the arbitration contract unlike judges who are paid by the state, practical enforceability of the decision, the need to employ as counsel if recourse to the courts is utilised and the possibility that litigation may have to be brought against parties external to the contract.
Parties to ADR may well be concerned about the preservation of their relationships with his suppliers after a dispute. The adversarial and combative nature of court proceedings makes relationship preservation highly unlikely and in this regard arbitration may be a better option. Noting once more that the parties will have agreed as to the terms of the arbitration; this will encourage a less contentious resolution process.
Companies will be contracting with various suppliers and other services. These contracts will govern the relationship between parties and the other signatory to each. However, disputes may arise which inevitably affect or involve third (manufacturers, shipping agents, delivery agents). As arbitration is a creature contract, the rule of privity applies, no rights or obligations can be conferred on non-parties to a contract unless the country to the ADR process provides such laws. Further an arbitration tribunal has no power to compel third parties, which is unlike the courts which have the power to compel the attendance of witnesses and evidence: offer injunctive relief; issue preservation orders etc.
This limited jurisdiction of ADR may be of concern, parties to ADR as to the nature of business may require that third parties be enjoined in potential disputes and if there are no provisions under United Kingdom laws which make that possible. If a dispute should arise, civil actions would have to be brought against third parties. This may be costly, inconvenient and time consuming. It would also require that the dispute be made public and engage adversarial nature of adjudication which would ultimately defeat the benefits of choosing arbitration.
Parties to Alternative Resolution would be concerned about the preservation of their relationships with other services providers after a dispute. The adversarial and combative nature of court proceedings puts a strain on business relationships, therefore, preservation is paramount. Noting once more that the parties will have agreed as to the terms of the ADR process this will encourage a less contentious resolution process.
For the sake of simplicity I will focus on one area of law which promotes the use of Alternative Dispute Resolution (ADR). I shall begin by addressing the legal procedures promoting ADR. I will then assess the reasoning behind these measures. I shall conclude by offering my opinion on these developments.
I have chosen to concentrate on family law. Due to recent developments, particularly the government’s contentious cuts to legal aid, ADR has grown in prevalence. This of course is in no way intended to overlook or underestimate ADR’s importance in the commercial sphere, nor its growing importance in general civil litigation.
Legal procedures promoting ADR.
The government’s policy is to promote the use of ADR as a method of resolving a dispute between parties before commencing litigation.
This is evident in Part 3 of the Family Procedure Rules 2010 which refers to the court’s powers to both encourage the parties to use alternative dispute resolution and to facilitate its use. Further, in some cases before parties come to court they will now be expected to attend a Mediation Information Assessment Meeting.
These measures together with arbitration and mediation have promoted ADR’s prevalence. I am of the view that ADR will expand, in light of the Family Justice Review’s expressed interest set out in their Interim Report in March 2011, in improving ADR and incentivizing its use.
The reasoning behind promoting ADR.
Lord Wilson of Culworth recently provided an analysis of the benefits of ADR during his keynote address at a reception at The Reform Club hosted by Collaborative Family Law. He focused on five main disadvantages of court proceedings, stressing that cases which were capable of consensual settlement rather than adjudication should be settled accordingly. I believe his summary provides a succinct and valuable analysis of the reasoning behind the promotion of ADR. I will briefly list it here for the purpose of this discussion.
He firstly noted the cost of proceedings, stating how the ratio of costs to assets is unacceptable and can result in malign consequences. Secondly he drew attention to the delay in court proceedings, which he noted can seem like an eternity to anxious parties. Thirdly he raised the issue of publicity surrounding court proceedings; referring to the intrusive and constant process of reporting involved in high profile cases. Fourthly he commented on the uncertainty in family proceedings, noting that there is often a spectrum of legitimate outcomes despite the relevant law being reasonably clear. Finally he remarked on the emotional burden cast upon the parties at court proceedings, directing focus on the deep unpleasantness arising from becoming locked a courtroom battle.
It is clear when taking into consideration the inherent disadvantages of an adversarial approach in certain family law cases, the opportunity to resolve issues in a different forum is required. ADR provides parties with an option other than litigation. It allows them to avoid the disadvantages listed above and assists in securing a peaceful settlement without resorting to court proceedingsop. ADR’s ability to secure an acceptable outcome, and the potential shortcomings of an adversarial approach, explain not only the reasoning underpinning ADR but also its increasing prominence.
Opinion.
In essence I agree with Laura Odlind that mediation aids the preservation of parties relationships. This is of critical importance when taking into consideration the human element and the complexity of emotions involved in family law.
ADR plays a crucial role in accommodating the peaceful resolution of matters. It achieves this through maximizing the opportunities available for parties to preserve their relationships through avoiding the need for litigation. ADR provides a realistic, positive and cost effective dispute resolution alternative to an adversarial approach. I predict that this will increase in significance in the light of emerging trends across the legal landscape; notably the pressure on firms to provide a holistic legal service in all material respects within family law.
However I also share the concerns of Sir Nicholas Wall that the public funding of mediation will not be sufficient ‘to resolve the problems of the myriad of unrepresented litigants who will come before the family courts’. This is of huge significance in the light of recent legal aids cuts. Whilst ADR certainly has worth in providing a credible alternative to an adversarial approach, it is important that safeguards are put in place to ensure that it remains available as a choice – and not as the only option.
I discovered the concept of Alternative Dispute Resolution (ADR) during my first year of university. In a class called “Legal System of Asia and Africa”, I quickly became familiar of the use of mediation over litigation in foreign legal systems. For example, in China, ADR is frequently used as a tool to insure social harmony, stability and order between individuals, families and communities. The procedure goes as follow: an unofficial “peace-talker”, who can be an extra familial person, a village elder, or a member of the community, endorses the role of a third –party mediator .This designated person needs to gather the facts of the case, consult with other social relatives and gather the two parties involved until an agreement is reached. In Chinese legal culture, it is a method that always have been preferable than to impose a decision upon one of the parties.
Today, the mediation method has gained popularity in the Western legal landscape. There are several factors that can explain best this phenomenon. Since the mediator, engaged in shuttle diplomacy between the parties, is in confidence, the focus of the process changes from a purely legal perspective to a more personal. For instance, factors such as business relationships, external commercial pressures, reputational issues or emotional responses can be taken into account to the necessary extent.
The ADR process seems to be more prone to reconciliation as the finale aim is to find an agreement. This contrasts with the more classical litigation approach that seeks to impose an agreement through an external court or arbitral tribunal. This approach may also be more consensual because it offers a broad and flexible range of solutions to suit the specific needs and interests of a party, such as non-monetary remedies (including services or apologies). Once again, this is significantly different from the fixed procedure of litigation proceedings which often involves limited range of outcomes: – i.e money damages, specific performance and an injunction.
Overall, ADR allows people in dispute to have a greater control over the determination of the outcomes, with the exception of some determinative processes such as arbitration. Additionally, this new legal method also offers practical advantages such as lower costs of procedure and quicker speed of the settlements. Of course, The Alternative dispute Resolution cannot be successful at all time. However, it has proven to significantly improve the communication between parties. Indeed, people are more likely to listen to one another and understand the key issues in the dispute.
Therefore, one may argue that the ADR method is less damaging to personal and professional relationships than the traditional court hearing. That also means that even though the dispute is not fully resolved in the ADR process itself, it can definitely help to reach an agreement in a quicker manner than it would have been if ADR had not been used.
In order to capitalize all of the above advantages, the ADR should be fully integrated into the European legal system. Law is often portrayed as rigid and severe; however, law firms should remain flexible and adapt their methodologies to different cases. Whether it is through the use of formal or informal dispute settlements, the goal shall remain the same; law seeks to reach a reasonable arrangement that can render justice to both parties.
The legal landscape is constantly evolving; alternative dispute resolution (ADR) is establishing a firm standing not only as a first response to dispute cases but also as an effective and efficient solution. Below I shall contribute to the debate by reaffirming points put forward and adding other angles. Firstly I shall address how ADR is becoming so prevalent and secondly why.
ADR is becoming prevalent because the Ministry of Justice (MoJ) has been actively promoting the use of ADR since the early 90’s when it set up a department to promote ADR. It is currently headed by Jeremy Tagg who was awarded the Civil Mediation Council’s Lord Slynn prize for services to mediation
Government departments signed an ADR pledge which commits them to use ADR for purchaser provider disputes and are recorded in the ADR pledge report annually. These help to set examples.
The MoJ, led by Jonathan Djanogly, the Minister for Civil and Family Justice, held a consultation with leaders in the mediation industry with the aim of understanding how ADR could be promoted as the first response to dispute resolution. The outcome was to establish that people could be ‘pushed’ towards ADR if public funding (Legal Aid) is directed towards mediation and away from litigation. This procedure is gradually being introduced into Family Law with the advent of Mediation Information and Assessment Meetings (MIAMS). There are similar plans for employment and civil disputes.
The MoJ which funds the HM Courts Service is increasingly concerned with the costs of running courts, especially now during times of austerity as some court closures become inevitable. ADR provides a cheaper route to resolution. In the small claims court there is a small claims mediation service headed up and paid for by the MoJ which is offered once the claim has been put in and before the court date. It is a telephone mediation service which has achieved an 80% success rate. This obviously saves time and money for all.
Since the 1980′s housing providers have been using community mediation for neighbour disputes, again achieving an 80% success rate, whilst over the last 15 years Family Mediation has been steadily growing into a sustainable business model. A different model has been used in workplace and employment settings which involves training employees as internal mediators. In effect the general public have been experiencing mediation for about 20 years.
From this it is obvious how ADR is encroaching into the legal environment; why it is occurring is questionable as there is a perfectly adequate resolution procedure already in place. However as Miss Odlind and other candidates point out, the benefits of mediation and arbitration make it a very compelling proposition i.e. the the ability to get a quick resolution reducing the amount of personal and financial resources needed, which in the current economic climate is clearly advantageous. It helps parties to maintain their relationships which can be crucial for further business or interaction. Finally it allows each party to stay in control of the outcome rather than rely on a third party.
In addition to these points mediation has other benefits; the dealings are private and not in the public domain as in court procedures. This means that cases are unable to be used to set a precedent as agreements are confidential.
In comparison, lengthy court processes are resource heavy, disempowering and risky for disputants especially where there is any element of challenge to the claim. Furthermore, when people litigate they often look forward to their day in court when they will be heard. The reality often falls short, whereas in mediation people always get heard. Getting heard is often more important than the actual settlement. In our society we sometimes find emotions hard to express and money becomes a financial proxy for an emotional injustice. Litigation rarely understands this and even dismisses the importance of this to the human psyche. Mediation provides for this and through an emotional experience the parties can re-connect rather than be alienated through a litigation process.
There are of course cases where mediation is not appropriate, where courts and litigation is the only solution, as either a last resort or when a hard face approach is more appropriate.
The legal profession have, in the main, been resistant to including ADR (ADR once stood for Alarming Drop in Revenue!) but the groundswell has made it very hard to ignore. Leading lights such as Stephen Ruttle QC and former appeals court judge Sir Henry Brooke have understood and promoted the benefits of mediation and the Civil Mediation Council have actively worked to promote its use in the legal landscape and attitudes are changing.
The industry itself is rising to the challenge and is developing new and innovative ways of using ADR. However it is still a relatively new industry and there are many theoretical models of mediation to choose from. The public is still largely unaware of the choices available to them although this is set to change as the Dispute Resolution through the use of mediation and collaborative processes becomes the mainstream first port of call for conflicts between people.
The combination of government steering (albeit for financial motives) and positive public experience is driving the legal profession to include mediation in its array of services with obvious client benefits. Law firms, such as Mishcon de Reya, are re -evaluating and allowing ADR to provide an effective first response to dispute cases, which in my opinion is the way forward for effective dispute resolution.
There are three principal explanations for the growing prevalence of Alternative Dispute Resolution (ADR) in recent years.
Firstly, the Civil Procedure Rules promote ADR as part of a mandatory pre-conduct protocol procedure, ensuring that all parties intending to litigate at least consider the alternatives before filing their claim at court. The rules clearly state that litigation should be a last resort. Since 6th April 2011 it has been necessary for applicants and respondents in family matters to attend a Mediation Information Assessment Meeting (MIAN) unless there are exceptional circumstances.
Secondly, within the current financial context, there has been a growing trend towards cost-efficiency resulting in closer scrutiny of legal costs and fees amongst clients. ADR is often less expensive than litigation and therefore it has provided a more attractive alternative to the court process which is often an expensive and time-consuming procedure.
Thirdly, individuals today demand more control over their affairs and as a result they are more willing to approach disputes with little or no legal assistance. It is hardly surprising therefore that mediation has grown alongside the numbers of litigants in person. ADR can provide an adequate solution to this growing demand for client control. For example, through arbitration clients receive a more flexible procedure compared to that provided by the courts. Both parties can benefit from more privacy and involvement throughout the process of resolving their dispute, whilst still receiving the benefit of a solution that is binding.
As Laura points out, ADR can benefit the client because it has the potential to preserve relationships and provides an appropriate way of dealing with disputes, even where there is a high degree of conflict. ADR can also provide more access to justice. The final report of the Family Justice Review, published in October 2011, confirmed that mediation was playing an increasingly important role in improving family justice.
In consideration of the above, I believe it is gradually becoming more appropriate for ADR to be asserted as dispute resolution methods in their own right. They should no longer be described as ‘alternatives’ to litigation, but should be put forward, by solicitors, as one of the many options available to clients who are in the advantageous position of making a choice as to how to deal with their dispute.
My opinion is that solicitors should promote ADR on an equal footing with litigation and not merely as an alternative to be sidelined in the early stages of proceedings. Solicitors should approach clients with an open mind to all the methods of dispute resolution available and make a tactful decision as to which method, based on the facts, is most appropriate. This approach will ultimately establish long lasting client relationships that will promote the legal work of solicitors and their respective law firms.
When people think of law, their concept begins at court and ends with judgment. Whilst litigation is both a practical and effective tool, its finality is undoubtedly harsh and uncompromising. It is no wonder then that Alternative Dispute Resolution has become increasingly popular as a way of sidestepping court proceedings. Mediation has become appreciated for its plentiful advantages, one of which, Ms Odlind has identified: ‘it’s easier for parties to preserve their relationship’. Such relationships are sustainable because of the personal aspect of mediation; an aspect that is so lacking in the process of litigation. There is no surrender of control to the representatives; there is no stringent formality that must be complied with; and the entire process can be condensed into a mere one or two days. It has furthermore proven more beneficial in the current economic climate; the costs are somewhat more appealing than those attached to the process of litigation. People are realising that settling a dispute needs not be burdened by financial sacrifice. Abraham Lincoln referred to lawyers as peacemakers, peacemakers who should encourage compromise amongst our neighbours. The courts are not averse to this duty, which is why mediation has been designed as a flexible, cost effective alternative. In fact, the courts have enforced the principle that refusal to mediate can give rise to cost sanctions. Multiple forums have been set up to aid the process; Mishcon de Reya’s own Conflict Clinics are a principal example of this. It seems everyone wants their day in court, due to some romanticised notion that they can stand up and enforce their rights. Every person wants this, of course, until they are in the middle of it: in the middle of what seems like endless weeks of paper work, bills, and stress. Litigation should only be a last resort: a conclusion that the relationship is unsalvageable, and the damage irreparable. Mediation can run alongside litigation or arbitration, so it is understandable that it would automatically be construed as an escape route. Each party believes he has a rightful claim, and if case law has taught us anything, it is that things are never simply black or white. The law is so commonly misconstrued as fighting for justice, when really its principal mechanism has always been to allow for compromise. Mediation is not in competition with litigation, nor is it treated as such by legal professionals. A lawyer need not be pro or anti mediation; a lawyer’s overriding objective is to act in the best interests of its client. It is the client’s overriding objective that counts here: the objective to solve an issue without consequence; to enforce rights without antagonising; and to compromise without surrendering. Mediation achieves this, which is how it has earned its place in the legal sphere, and why it is justifiably becoming a more popular legal route to dispute resolution.
Correction to comment below, *but also stress*
Due to the CEDR’s increased popularity and the Civil Procedure Rules coming into force in 1999, the frequency of ADR has increased. It is now a necessary consideration of the ‘overriding objective’. This ensures that both parties have attempted to settle or find another way to speed up and deal with cases justly. In my opinion the introduction of ADR and its methods are essential.
In family litigation or disputes, many family members wouldn’t litigate due to the arduous process of trials and hearings, on top of facing a family member. I believe it is wrong to drag children through trial when it comes to custody battles. In this instance I think ADR should be used regularly. Although the job of the solicitor is to advise the client as opposed to making decisions on their behalf, it should be in the back of all of our minds to advocate it with some enthusiasm. In particular I would like to draw attention to the ‘Conflict Clinics’ that Mishcon de Reya offers; placing parties to a conflict in a non-adversarial environment in order to try and come to a solution. This solidifies my belief that while Mishcon are looking to grow and increase revenue, they take client care seriously. The firm has also proposed that conflict clinics should be an obligatory procedure in this area.
In terms of civil litigation, I agree with Ms Odlind that we will see a huge increase in ADR due to the current economic climate and the potentially high costs when it comes to litigation. I predict it being increasingly used in business relationships where both parties would like to continue business agreements with minimal or reduced animosity towards the other. It is only natural that a party that suffers damages will want to recover, but it may also be worried of its future relationship. In this case ADR may be a preferable solution, not only as a means, but as an alternative in awarding damages; the wrongdoer may agree to continue a course of business with the wronged party as a means of a remedy. In trial, it is fair to say that in cases that are followed to completion, 50% of all parties are unhappy, as there is a winner and a loser.
Mishcon de Reya offers clients a cost effective, quality and professional legal advice whilst remaining open to more creative ways of dispute resolution; a core value. The firm thrives on lateral thinking delivered in an effective manner. I have no doubts that this is a top firm that will have no problem with ADR’s increased usage. It is flexible and there are many methods, not just mediation. Lord Woolf stated that litigation should be a last resort, I agree. ADR not only saves time and money, but it also stress; clients have feelings. I believe the best solutions investigate what happened in the past, this is made harder by having one eye on the potential prize or penalty hanging over your head.
I agree to a large extent with Laura. Alternative Dispute Resolution (ADR) has a significant part to play in resolving disputes – it in fact already does. The current Civil Procedure Rules promote the use of ADR.
Litigation can be expensive, slow and ultimately you can lose, with potentially huge costs implications. Even if you win at court you rarely, if ever, recover your full costs. That may not be the end of it either; enforcement of the judgment can be expensive, perhaps fruitless if the losing party has spent all its money on litigation.
So the purpose of ADR is to deal with these limitations. It can be a faster, cheaper and more flexible alternative. Mediation in particular has the advantage of allowing the parties to agree to solutions that a court simply does not have the powers to create. In theory the parties can agree to anything they want, provided it is a workable and enforceable agreement.
Privacy is another advantage of ADR. Parties who have personally sensitive or commercially valuable information may not appreciate that material being made public at trial with subsequent wide reporting in the media.
Of course ADR depends on the intentions and outlooks of the parties. The aim is to foster a constructive dialogue so the parties can avoid the pitfalls of litigation. If either party steadfastly refuses to mediate the chances of success are limited. So it is the responsibility of the solicitors to highlight the strengths and weaknesses of ADR so the client is fully informed. The choice is then theirs.
Beyond the commercial and legal advantages of ADR I think there are important human elements too. In a dispute there is probably some sort of animosity or tension between the parties, which will influence how the litigation proceeds. The act of getting both parties in the same room in front of an independent third party, who ideally has the respect of both parties and expert knowledge of the dispute, may be enough to calm frayed tempers and bring a more rational approach.
It may encourage the parties to actually listen to each other. The parties can identify the real issues in dispute and areas of common ground. The input of a mediator may help the parties recognise the potential for a commercial agreement and they can turn a loss into a gain.
Even if ADR is unsuccessful in producing an agreement, there has been an opportunity to narrow the issues in dispute and assess the strengths of the respective cases, with a view to saving money later down the line. It is important to remember that ADR is not in competition with litigation, it is a crucial supplement to it.
In short if there is a method that can save a client money and time, while avoiding the stress of litigation then lawyers should understand it and be prepared to advise on it.