If court is a ‘last resort’- what are the alternatives?
Courts actively encourage parties to resolve their disputes without court intervention and consider litigation to be a ‘last resort’. As Her Majesty’s Courts and Tribunals become increasingly overburdened with cases and whilst resources and funding continue to diminish, it is not hard to see why the courts take this ‘last resort’ approach. For some types of disputes like construction and engineering disputes, it is a requirement to undertake some form of ADR at the initial stages before a claim is issued. There are a range of different ADR methods available with numerous providers for you to choose from.
What is ADR?
ADR refers to ways of resolving disputes between parties which often, but not always, involves a third party facilitator; the hope is that the dispute will be resolved without ever having to go to court or reaching a trial (if proceedings have already begun). Whilst ADR can form part of the pre-issue stage of a claim, it can take place at any stage even after proceedings are issued if both parties so wish. It is important to remember that you have a duty to continue to consider the possibility of reaching a settlement at all times; this includes even after a claim has commenced in court.
Types of common ADR
This involves an independent third party, a mediator, who assists and facilitates the parties to come to a mutually agreed outcome. It is possible for parties to appoint a mediator who specialises in the same/similar area as the subject of the dispute. Unlike other forms of ADR, the mediator does not decide the outcome of the dispute, the parties do.
This is where an independent third party considers the facts and makes a decision to resolve the dispute. Again the arbitrator can be a specialist in the subject of the dispute. In most cases the arbitrator’s decision (and unlike a lot of the other ADR methods) will be legally binding on the parties.
– Early Neutral Evaluation
This entails an independent third party to consider the claim and give an opinion or evaluation. This may be about the likely outcome of the case, or about a particular issue or point of law. The third party can specialise in the subject of the dispute for example a quantity surveyor, or may be a legal professional. The opinion/evaluation is not legally binding.
This method is often used in consumer disputes with traders and can be free. An independent third party, the conciliator, helps the parties to reach an agreed outcome to resolve the dispute.
Whilst the common types of ADR are listed above, there are other forms out there that may be more suitable for a particular type of dispute over another. It is important to research and evaluate the method right for you and seek legal advice if you are unsure.
ADR: The pros
- ADR can be a more cost effective way to resolve a dispute which could potentially be resolved faster than taking the matter through the adversarial court system to trial.
- You have the ability to maintain and preserve relationships, which may otherwise be destroyed if the matter proceeds to court and one party ‘wins’. This can be important where the dispute is between businesses, family or neighbours.
- The independent third party can often be a specialist in the relevant field meaning that they could be in a position to better understand the parties’ needs and desired outcomes.
- Arbitration aside, parties can be actively involved in reaching a mutually agreed decision as opposed to having one imposed on them which is often in favour of one party against the other. There can be a level of flexibility in the resolution reached as the decision does not have to be purely ‘legal’- an apology or change in policy can form part of the resolution.
ADR: The cons
- There may not be a choice on whether to use ADR or which method to use. Contracts can often contain ADR clauses, arbitration being a common method, which dictate what will occur if a dispute transpires. Although, such clauses have been deemed unfair in consumer contracts.
- The cost of ADR can vary with some schemes being free to use whilst others can cost significantly more, especially if the dispute is technical or complicated and the facilitator is very experienced or a specialist in their field.
- There could be a disparity of power between the parties, which could make a face-to-face method of dispute resolution difficult especially where there has been violence or threatening behaviour.
- ADR requires the consent of both parties, so if the opposing party is unwilling to engage in this, the alternative will be to pursue the matter in court.
- Research is important – do your research and look into the different ADR options out there so you can consider which method is most suitable for your dispute.
- Evaluate – at an early stage of the dispute compare the costs of using ADR with the costs of going to court. If you require assistance with this, a solicitor will be able to help. Also look into the costs of the different types of ADR and different mediators/arbitrators (depending on your preferred ADR method).
- If your dispute is with a trader, you should find out whether the trader is a member of any trade association that offers an ADR scheme.
With so many types of ADR and providers on offer, it can be a tricky task to navigate through what is right for you and/or your business. It is important that if you are unsure or have any queries, you should seek legal advice and assistance. At JFH Law, we are ready to help you. We are experienced in dealing with civil claims and have successfully resolved disputes without the need to issue proceedings.
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Jigna Vekaria, Solicitor
Please note that the information contained in this article was correct at the time of writing. There may have been updates to the law since the article was written, which may affect the information and advice given therein.