Alternative dispute resolution – dispute resolution methods which encourage the parties to reach their own solution outside of the court system and in which a neutral third party may act as facilitator. ADR covers processes such as negotiation, conciliation and mediation. Parties play an active role in the ADR process, whereby they are able to identify their specific needs and craft and implement solutions without the need for an external adjudicator.
The primary purpose of ADR is to save time and money of both parties and to keep matters out of Court through the promotion of settlement. The litigation process can become protracted very easily and it may take months or even years for your matter to go to hearing. By engaging in Alternative Dispute Resolution processes parties give themselves the best chance in coming to a mutually satisfying outcome.
The adoption of ADR processes has a primary role of achieving the overriding purpose of the Civil Procedure Act 2005 (NSW) which, as stated in section 56, is to “facilitate the just, quick and cheap resolution” of the issues in dispute. An indicator of the focus that is placed on achieving the overriding purpose, some Courts require that parties engage in mandatory mediation (or a Registrar, Magistrate or Judge may direct parties to engage in mediation) before a matter proceeds to trial.
The most common type of ADR process is negotiation. This is the usual way to settle disputes whereby parties are encouraged to communicate their issues and reach agreement without the involvement of any other third party. If this fails at the initial stage and legal representation is required, negotiation is a powerful tool used by practitioners who communicate with each on behalf of the disputing parties.
A second Alternative Dispute Resolution approach is conciliation where the parties appoint an independent third party who assists them to narrow the issues in dispute, develop options and help them reach an agreement. A conciliator will often have specialist knowledge in the area and give parties expert advice as to the possible solutions to the issues in dispute. They remain impartial, however will not tell you what decision to make nor do they have the power to adjudicate any dispute.
Mediation, another common form of ADR process, is similar to conciliation in that an independent third party assists the parties to identify the issues in dispute, deliver options and facilitate the resolution of a dispute. However, unlike conciliation, a mediator is unable to give their advice about an issue or have any role in determining or suggesting an outcome.