, Dispute Resolution:
Alternative Dispute Resolution:
Alternative dispute resolution (ADR) = any means of settling disputes outside of the traditional
litigation process.
If the client is willing to participate in ADR, it should be used, unless:
a) It is obviously inappropriate
b) The other party is unlikely to co-operate in the process
c) The other party cannot be trusted to comply with an award
→ A party who chooses not to engage in ADR may face penalties (unless they have justification)
○ Burden is on the other party to show that the refusal is unreasonable
Solicitor’s are required to confirm that they have explained to their client:
a) The need to try and settle
b) The options available
c) The possibility of costs sanctions if they refuse to attempt to settle
Mediation:
Means of resolving disputes with the assistance of an independent third party
● They will not impose a solution
● The third party should be trained to act as a neutral & should have the appropriate
industry / commercial knowledge to understand the dispute
● It is voluntary and confidential, or ‘without prejudice’
- Anything said to the mediator is confidential, unless express permission is
granted for info to be passed on
- If it fails and court proceedings are taken, the court will not be made aware of the
ADR until after the judge has awarded damages
, ● Parties can withdraw at any time before a settlement is reached
Advantages Disadvantages
☑ Cost and Speed: ⤫ Disclosure:
● Cheaper than arbitration and litigation ● Risk that parties may resolve the dispute without
● BUT parties will still have to pay the third party knowing all the facts (as don’t have to disclose
and their own layers docs / evidence)
☑ Flexibility: ⤫ Privacy:
● Parties are able to choose the procedure to be ● If a client requires public vindication, privacy
followed (no legal requirements) may be a disadvantage → lose opportunity to
demonstrate no fault
☑ Privacy: ⤫ Ability to withdraw:
● Clients / customers / public not aware of the
circumstances / outcome of the dispute
☑ Preserving a business relationship: ⤫ Enforcement:
● Ideal where the parties will continue to deal with ● Even if an agreement is reached, it is not
one another automatically binding → can’t be enforced like a
court judgement
● Agreed terms can form a contract
☑ Commercial reality:
● Can lead to arrangements which a court may not
order
☑ Ability to withdraw
, Arbitration:
Arbitration = it’s a substitute for litigation → once a party has agreed to be subjected to it, they
can’t then take advantage of the normal court processes
● Dispute is referred to an independent arbitrator (can be specified in the OG contract)
● Arbitration can arise in 2 ways:
a) Parties may be contractually bound to use arbitration in the event of a dispute
b) Parties may agree to arbitration once a dispute has arisen
● If the agreement to arbitrate is in writing, largely governed by the Arbitration Act 1996
Advantages Disadvantages
☑ Decision made by an impartial third party with ⤫ Less investigated
expertise ● Procedure may not receive the depth of
● Solutions often more practical than a court’s investigation it would do in a court setting
approach
☑ Less formal process ⤫ Certain remedies not available (e.g. injunction)
☑ Speed ⤫ Can be expensive (arbitration expert or panel will
need to be paid, as well as lawyers)
☑ Privacy
☑ Decisions are binding on the parties (unlike with
mediation)
● The winning party can apply to the High Court
for permission to enforce the arbitration award
Alternative Dispute Resolution:
Alternative dispute resolution (ADR) = any means of settling disputes outside of the traditional
litigation process.
If the client is willing to participate in ADR, it should be used, unless:
a) It is obviously inappropriate
b) The other party is unlikely to co-operate in the process
c) The other party cannot be trusted to comply with an award
→ A party who chooses not to engage in ADR may face penalties (unless they have justification)
○ Burden is on the other party to show that the refusal is unreasonable
Solicitor’s are required to confirm that they have explained to their client:
a) The need to try and settle
b) The options available
c) The possibility of costs sanctions if they refuse to attempt to settle
Mediation:
Means of resolving disputes with the assistance of an independent third party
● They will not impose a solution
● The third party should be trained to act as a neutral & should have the appropriate
industry / commercial knowledge to understand the dispute
● It is voluntary and confidential, or ‘without prejudice’
- Anything said to the mediator is confidential, unless express permission is
granted for info to be passed on
- If it fails and court proceedings are taken, the court will not be made aware of the
ADR until after the judge has awarded damages
, ● Parties can withdraw at any time before a settlement is reached
Advantages Disadvantages
☑ Cost and Speed: ⤫ Disclosure:
● Cheaper than arbitration and litigation ● Risk that parties may resolve the dispute without
● BUT parties will still have to pay the third party knowing all the facts (as don’t have to disclose
and their own layers docs / evidence)
☑ Flexibility: ⤫ Privacy:
● Parties are able to choose the procedure to be ● If a client requires public vindication, privacy
followed (no legal requirements) may be a disadvantage → lose opportunity to
demonstrate no fault
☑ Privacy: ⤫ Ability to withdraw:
● Clients / customers / public not aware of the
circumstances / outcome of the dispute
☑ Preserving a business relationship: ⤫ Enforcement:
● Ideal where the parties will continue to deal with ● Even if an agreement is reached, it is not
one another automatically binding → can’t be enforced like a
court judgement
● Agreed terms can form a contract
☑ Commercial reality:
● Can lead to arrangements which a court may not
order
☑ Ability to withdraw
, Arbitration:
Arbitration = it’s a substitute for litigation → once a party has agreed to be subjected to it, they
can’t then take advantage of the normal court processes
● Dispute is referred to an independent arbitrator (can be specified in the OG contract)
● Arbitration can arise in 2 ways:
a) Parties may be contractually bound to use arbitration in the event of a dispute
b) Parties may agree to arbitration once a dispute has arisen
● If the agreement to arbitrate is in writing, largely governed by the Arbitration Act 1996
Advantages Disadvantages
☑ Decision made by an impartial third party with ⤫ Less investigated
expertise ● Procedure may not receive the depth of
● Solutions often more practical than a court’s investigation it would do in a court setting
approach
☑ Less formal process ⤫ Certain remedies not available (e.g. injunction)
☑ Speed ⤫ Can be expensive (arbitration expert or panel will
need to be paid, as well as lawyers)
☑ Privacy
☑ Decisions are binding on the parties (unlike with
mediation)
● The winning party can apply to the High Court
for permission to enforce the arbitration award
