Ch 4 Business Law Alternative Dispute Resolutions

Alternative dispute resolution

- ADR is used rto settle claims between litigants in many different situations, circumventing the court system - the resolution of legal disputes through methods other than litigation, such as: - negotiation, meditation, arbitration, summary jury trials, mini trials, neutral case evaluations and private trials

Arbitration

- ADR meethod in which neutral third party, known as arbitrartor, hears both parties' cases and renders a binding decision - often a voluntary process in that parties typically have a contractual agreement to arbitrate any disputes - this agreement may stipulate how the arbitrator will be selected and how the hearing with be administed

negotiation

- a bargaining process in which disputing parties interact informally, either with or without lawyers, to attempt to resolve their dispute - typically for a settlement to result both parties must give something up - not a formal alternative dispute resolution method

mediation

- disputing parties select a neutral party to help facilitate communication and suggest ways for the parties to solve their disputes - third party mediator usually has expertise in the area of the dispute - one of the mediator's main goals is to help each party listen carefully to the opposing party's concerns

adversarial negotiation

- each party attempts to maximize its own gain

Other alternative: dispute resolution method

- mediation arbitration - a dispute resolution process in which the parties agree to start out in mediation - if the mediation is unsucessful on one or more poitns, the parties agree to move on to arbitration

primary forms of alternative dispute resolutions

- negotiation - mediation - arbitration

mediation

- not all mediation is successful, but it is far less expensive and quicker than litigation. The mediator has a great deal of latitude

problem solving vegotiation

- parties seek a joint gain

advantages of mediation

- preserves relationship throughout dispute - open communications alleviates bitterness to opposing party - possibility of creative solution (not necessarily a monetary award) - high level of autonomy

Arbitration hearing

- similar to bench trial- both parties present their cases to neutral third party - may introduce witnesses and documentation, cross examine the witnesses, and offer closing statements - different from trial- arbitrartor more active than judge or jury - no official record or the hearing is kept - rules of evidence relaxed

arbitration award

- the arbitrators decision is called an award, even if no monetary compensation is awarded - typically award issued within thrty days of hearing - not required to make findings of facts - few awards are appealed

mediator

- the mediator helps the parties evaluate the alternatives by comparing the alternatives with the disputed points and interests identified earlier - because the mediator's role is to facilitate an argument, the mediator will often need to be persuasive to help the parties concede certain points so that agreement can be reached