Most commonly, the issues between two parties, or two entities, are handled with official litigation. Litigation is a complex and time-consuming process that requires a large number of resources to finish with an optimal result, but luckily, there are alternatives that might be better options in many situations.
One of the best ways to handle a dispute, outside of coming to a mutual agreement without any sort of legal intervention, is called “alternative dispute resolution”.
Today, we’re going to go over what alternative dispute resolution is, why it’s desirable, some of the situations it’s best for, and of course, how you can go about it if you decide it’s the right legal path for your situation.
Let’s get started.
What is Alternative Dispute Resolution?
Alternative dispute resolution is a fairly broad term that simply refers to a method of resolving a problem without having to take the case to court and settle into complex litigation matters.
Mediation, negotiation, and arbitration are all forms of alternative dispute resolution.
In essence, this is supposed to be a friendlier way of dealing with an issue when there’s a possibility that litigation might be a bit much.
Why Does Alternative Dispute Resolution Exist?
Not every problem requires litigation. There are plenty of situations where two parties are having a dispute over something minor, or they’re not so torn on the issue that there is a possibility of coming to a reasonable conclusion without having to officially involve the courtroom.
This is crucial for three reasons.
First, there are the costs involved with going to court.
Litigation is not cheap. You need to hire a full legal team, and that legal team will require payment for as long as the process goes on. You’re also charged for every consultation between litigation sessions, and then there are court fees and the potential payment you might have to make. That adds up to an extremely expensive experience.
That leads to our second point. It takes a considerable amount of time.
This is difficult for the obvious reason of taking up your time, exposing you to stress, and generally postponing any sort of resolution. However, as we stated above, that also drives up your costs.
Finally, litigation can be stressful on relationships that face a dispute but aren’t necessarily irreconcilable. It’s such a stressful process, and since litigation forces two teams to fight against each other for the best result for one party, that route should be a last resort.
Alternative dispute resolution solves all three of those problems. It’s cheaper in general, tends to take far less time, and of course, that makes it less of a stressor between parties if there’s still room for civil behavior.
In essence, this is a last-ditch effort before litigation becomes necessary. It’s the “lite” version of litigation that keeps the two parties in charge and gives them the ability to handle the situation in a controlled environment with mediators there to prevent things from getting out of hand or only going one way.
What Situations is Alternative Dispute Resolution Used for?
As we said earlier, ADR, or alternative dispute resolution, is a very broad term. It’s not just for one sector of the legal field or certain types of cases. It can be used for practically anything that’s not a criminal case.
However, to give you a good idea of what it’s best for, we’re going to highlight three circumstances in which you’re likely to see it used the most.
1: Neighborly or Familial Disputes
First, this is one of the best ways to use ADR. This can go for family, friends, or neighbors, but our example is going to focus on a neighborly situation.
Let’s imagine that you have a tree on your property, and it’s close to the fence line, but it’s still your property. Your neighbor hates it and wants it removed, but you planted the tree for fruit, and you’re not willing to give it up.
One day, while you’re at work, your neighbor sneaks onto your property and removes the tree themselves; costing you the tree, but also damaging your fence since they didn’t do it professionally.
Now, your neighbor refuses to pay for damages, but you need to show them that the problem isn’t simply going away.
Starting litigation right away can end up costing you far more than you have to pay to replace the tree and the fence, and while you’re upset with your neighbor, you don’t want to put them through a full-blown legal process.
This is a great time to use alternative dispute resolution.
While you and your neighbor can’t reach a mutually good decision on your own, having some professional help present during communication can help. So, you start an ADR process, non-biased mediators who understand the law sit in during the process, and you discuss the situation together in an official environment, but not in a courtroom.
Because of this approach, the mediator can help prevent one side from just refusing to accept anything, and they can even provide first-hand knowledge of how the case is likely to go if it does go to court; which can be crucial in this situation, because it’s a clear-cut case of trespassing and destruction of property. Knowing that fighting it in court will likely not go their way tends to be persuasive.
This is one way to reach a good resolution for both parties, though. Since it’s not official litigation, there’s room to come up with less conventional plans such as monthly payments, handling one problem at a time, etc. It’s also less likely to leave you and your neighbor fighting for years over something very simple.
2: Business Transaction Gone Wrong
For this one, let’s assume that your business, a small retailer, ordered a large quantity of specialty t-shirts that were supposed to be made to certain specifications. When you got the shirts, they weren’t what you needed, and the seller now refuses to refund your company because of some sort of wording on their site.
This is a complex situation, but entering into litigation might not be financially feasible for either small business, and you two might not want to devote your time and effort to that type of fight when it is more easily resolved by simply getting into a face-to-face debate with proper guidance.
In this situation, it’s harder to know which way it would go, but the ADR process would help you find a proper solution that takes everything into account without taking forever or forcing situations that neither side wants to deal with.
3: Customer vs. company Dispute
This is a common issue that often ends up going into litigation, but that’s frequently not the right way to handle it.
Let’s assume you’re a customer at a business, and an employee in that business accidentally spilled a slippery substance on the ground. They forgot to clean it up or mark it correctly, and you slipped, broke an arm, and were unable to work for a month.
Now, you want compensation, but you’re facing a large company with its own legal team, and you don’t have the resources to go through with a legal case. One option would be to enter an ADR process where you can try to appeal to their sense of reason.
Oftentimes, settlements end up coming out of this, and while it’s not as much as you possibly could make in court, it does reduce the chance of the company being able to toss its money around to avoid paying you anything.
When Isn’t ADR Useful?
Alternative dispute resolution is extremely useful in the majority of situations as long as the two parties are capable of speaking and being civil. However, there are situations when it’s wildly inappropriate, and in some situations, it’s not even an option.
The most extreme example of this would be a murder case or another grisly crime. You can’t bypass the courtroom and try to settle that in an ADR setting. That’s obvious, as criminal charges are pressed.
However, there are less clear-cut situations.
Sometimes, the extent of a dispute might be too much to rely on ADR. There might be too much on the line, or the issue might be more serious such as an employee stealing money over the course of years, a boss not following legal regulations, etc.
Finally, sometimes people just don’t get along well enough to handle the process, or they don’t want to. A custody case is often a good example of this. While it’s optimal for parents to split while behaving civilly and be there for their children together, that isn’t always possible, and the relationship is far too volatile, or even dangerous, to handle things without proper litigation taking place.
Again, the term is extremely broad. So, these aren’t the only situations that it isn’t good for, but it is a good illustration of general situations you should simply take all the way to court.
How is Alternative Dispute Resolution Handled?
Alternative dispute resolution can look different for every case because there are various ADR tools that might be used. One case might just require both people to talk with legal teams and a mediator present, and another might go all the way to having a mini-trial.
However, the general process tends to be very similar despite the variations that might occur.
Both parties have to agree to enter the ADR process. If one is absolutely refusing, litigation is the next step. If they do agree to take a more reasonable and civil route, they will meet in an official environment, which can be a courthouse’s office space, a meeting room, or another professional space, and they’ll be open to discuss the matter. The goal for both parties is to be reasonable and find a resolution that meets both their needs as best as possible. Each party can be accompanied by a legal professional who helps them stay on track, but a mediator is present to prevent bullying, tense situations, or anything that is overly lopsided and not agreed to by both parties.
Optimally, both parties will agree, a legal document reflecting the deal will be made, and everyone will go on with their lives. If no agreement is reached, proper litigation will probably be recommended. That’s unfortunate, but it does happen occasionally, and in that case, the ADR process might feel like an unnecessary expense. That’s why choosing the right time to use ADR is so important.
How Much Does ADR Cost?
One common question we get is how much does ADR cost. Well, that’s practically impossible to tell you, because there are so many variables that pinpointing a solid number, or even a reasonably accurate range, is not going to hold up in every situation.
However, due to the lower demand for legal resources and the shorter time it takes to reach an agreement, it is almost always far cheaper than litigation.
How Do I Know I Need ADR?
We’ve highlighted a few examples of when to use the ADR process and when not to, but there’s no way to cover every situation in one guide. There are also numerous variables to decide on once you do choose to use ADR. Such as what your goal should be, which ADR tools you need to use, and more.
Understanding all of that is incredibly difficult, and because this is supposed to be an effort to reach a conclusion before having to go to court, it’s important to make the best choices possible.
To do that, you need a bit of guidance.
Litigation Legal Insight is here to provide that guidance.
We can help you determine whether ADR is appropriate, what resources you need, the right approach, and more. However, even if you do eventually end up going to court officially, we’re still here to help.
Our team of legal specialists can walk you through all your legal needs and help you make the right decisions.
Contact Litigation Legal Insight, today.