Settlement Doesn't Only Occur on the Courthouse Steps

What is "alternative" about dispute resolution?

Traditionally, ADR has simply meant an alternative to trial (litigation); however, ADR has significantly evolved over time, and it encompasses many different forms and methodologies. 

The two best known ADR processes are arbitration and mediation.

Arbitration

Like litigation, arbitration is a procedure that results in a decision in favor of one party and against the other party. Aribitration is often conducted through by a private organization with a list of arbitrators and specific rules for the process. Well known arbitration organizations include the American Arbitration Association, JAMS and more locally, Arbitration Service of Portland, Inc. 

Disputing parties often select an arbitrator (or panel of arbitrators) on based of their expertise, such as with construction law or intellectual property, etc .... This is intended to speed up the process by not having to educate the decision maker about the fundamentals of a particular industry or area of law.


Similar to trial, the arbitrator (often a retired judge or attorney) decides the case following a hearing. The arbitrator's decision may be "binding" (not appealable) or "non-binding" (appealable) depending on prior agreement between the disputing parties.

Essentially, arbitration is like a private/contracted trial.

Mediation

Mediation is a process where a neutral third party (often a retired judge or attorney) works to facilitate a settlement between the disputing parties. Unlike litigation or arbitration, the mediator does not decide the outcome of the dispute. In other words, the authority to settle a case remains exclusively with the disputing parties. Essentially, mediation is a facilitated negotiation -- the facilitator being the mediator.

Mediation can be extremely valuable for many all kinds of disputes. The process allows the parties to think more "creatively" about how to best resolve their dispute and it is less bound by the rigidities of trial and arbitration.  The mediator can help both sides evaluate the strengths and weaknesses of their respective positions and work to bring bring the parties closer together in light of the same. The mediator is only allowed to share information with an opposing party that has been authorized by the disclosing party. In that way, the mediator can know more about a case than either side, and use that knowledge to facilitate an agreement.

Mediation can be valuable even when an agreement is not reached, as it requires the parties address the risks associated with their case if it proceeds all the way to arbitration or trial.

Hybrid ADR

As the term implies, arbitration and mediation can be used in concert, such as where the neutral first acts as mediator (negotiation facilitator) and then acts as arbitrator (decider). There are several variables to consider when choosing the right ADR process or processes over the course of a dispute.

Negotiation

Though not immediately thought of as ADR, direct negotiation between disputing parties (either with or without legal counsel) is certainly an alternative to litigation. And as such, there are a myriad of negotiation styles and techniques. It is not a "one size fits all" type of process. Negotiation takes place over the course and against the backdrop of nearly every dispute, and so it is wise to continually evaluate and re-evaluate negotiation tactic and timing. The certainty of settlement is quite often the better choice than facing the many uncertainties of arbitration or litigation.

At Cook Law Firm, we believe ADR analysis is extremely important and  should play a crucial role in most, if not all, disputes.