Advantages and Disadvantages of ADR
Understanding Alternative Dispute Resolution
Alternative dispute resolution (ADR) refers to any process designed to resolve disputes that does not involve going to court. Like any process, ADR has pros and cons.
The considerations below should help determine whether alternative dispute resolution (such as mediation or arbitration) could be right for a specific problem.
Advantages of ADR
- A jury is not involved. Juries are unpredictable and often amplify or decrease damage awards purely according to whether they like the parties. Juries have awarded claimants damages that are well above what they would have received through alternative dispute resolution; and they have also done the opposite. Basically, avoiding juries means that both parties are more likely to get reasonable damages if damages are due.
- Expenses are kept down. Attorneys and expert witnesses are expensive, meaning litigating a case can easily run up obscene bills. Alternative dispute resolution offers the benefit of getting the issue resolved quicker than would occur at trial – and that means less money spent for both sides.
- ADR is speedy. Trials are lengthy, without exception. In many jurisdictions it could take years before you even get to begin arguing your case before a judge, much less get a verdict. There are better things you could be doing with your time.
- The results can be confidential. The parties can agree that information disclosed during negotiations cannot be used later in later proceedings. The final outcome can also be made private if the parties wish. Courts do not offer this -- trial are open to the public, which means everyone will know your business. That is why so many high-profile cases have “out of court settlements”.
Disadvantages of ADR
- There is no guaranteed resolution. With the exception of arbitration, alternative dispute resolution processes do not always lead to a resolution. That means it is possible that you could invest the time and money in trying to resolve the dispute out-of-court and still end up having to go to court.
- Arbitration decisions are final. With few exceptions, the decision of a neutral arbitrator cannot be appealed. Decisions of a court, on the other hand, usually can be appealed to a higher court.
- Participation could be perceived as weakness. While the option of making the proceeding confidential addresses some of this concern, some parties still want to go to court “just on principle.”
Is it to one’s advantage to use alternate dispute resolution? In many cases, the answer is a resounding “Yes.” However, there is no absolute answer. Instead, the circumstances of each case need to be weighed separately. Knowing one’s options is an important first step.
With research from Isaac Kennen.
The copyright of the article Advantages and Disadvantages of ADR in Law is owned by Estela Kennen. Permission to republish Advantages and Disadvantages of ADR in print or online must be granted by the author in writing.
