In an earlier post we touched upon the reasons why your business may want to consider alternative dispute resolution in lieu of litigation in the event of a contract dispute. In this post we will briefly consider some of the specific forms that alternative dispute resolution (ADR) can take.
Arbitration. This is probably the most-used and most familiar form of ADR. Its advantages include the ability of the parties to the dispute to choose an arbitrator (or arbitrators) who is familiar with the subject matter of the agreement, as well as having the arbitrator’s decision be binding and enforceable in court.
Mediation. The primary advantages of mediation are its comparative informality compared to some other forms of ADR, as well as its emphasis on finding a way for the parties to the dispute to work together to resolve their differences without the adversarial atmosphere that litigation or some other ADR methods can create.
Mini-Trial. A mini-trial is effectively a way for the parties to “preview” what the dispute would look like in court, complete with attorney case presentations and witness testimony. The goal of the mini-trial is similar to mediation in that it seeks to encourage the parties to engage senior management to resolve their differences together, or to call upon a third-party intermediary to render a non-binding opinion.
Early Neutral Evaluation. This is often used as a preliminary step to other forms of ADR, and involves the presentation of both sides’ legal arguments to a third-party intermediary who is also frequently a subject matter expert in the area disagreement. The task of the intermediary is to render an informal estimation of the parties’ respective legal strengths and weaknesses, but with an eye toward reaching a cooperative solution.
Summary Jury Trial. This is a form of ADR that is used mainly in connection with cases brought before federal courts. Although it does involve the use of a jury, its purpose is not as a substitute for litigation as much as it is a way to help parties to settle their disputes before the actual commencement of trial.
Freedom of contract means that your business can agree with its contract partners to alternative dispute resolution instead of litigation. Your business law attorney can help you to decide whether ADR is right for your agreement, and which form of ADR is best suited to your specific circumstances.