Mediation, Arbitration, and Alternative Dispute Resolution (ADR)

Disputes that can't be resolved between the parties typically end up in a court of law. Over the years, however, the costs of trying lawsuits have risen, the number of lawsuits filed has increased, and the length of time required to resolve disputes has grown, which has frustrated many people, including lawyers and judges. Out of that frustration has grown an effort to find cheaper and quicker methods, called alternative dispute resolution or ADR.


Because no one ADR technique is seen as the solution to all that ails the legal system, several different approaches are in use. Among them are arbitration, mediation, mini-trials, and summary jury trials. In addition, the various techniques are being used differently. For example, in some situations, the ADR decisions are binding on all the parties; in other cases, they are not. The following in an overview of ADR approaches.


Arbitration. Arbitration involves a presentation of evidence by both sides to a dispute, much like in a typical lawsuit. The difference is that an arbitrator or panel of arbitrators hears the evidence rather than the judge. For example, in an arbitration involving an automobile accident, the arbitrator might be an attorney not involved in the case who has expertise in auto accident cases.


Arbitration most commonly arises where a contract between two parties has an arbitration clause, which typically provides that both parties to the contract agree to settle any disputes through arbitration rather than through the courts. Arbitration clauses also will provide whether the arbitrator's decision is binding, as well as other related provisions, such as the process for choosing who will arbitrate the dispute.


Illinois has enacted the Uniform Arbitration Act, which means that arbitrations are recognized in Illinois and Illinois courts enforce arbitration awards. If a party in a binding arbitration fails to comply with the decision handed down by the arbitrator, the other party's recourse is to file suit in Illinois court to enforce the decision.


Arbitrators are usually paid fee for their services, which is split between the parties.


Mediation. Mediation is less like a typical trial than is arbitration. Instead of a presentation of evidence by both sides, mediation involves efforts by a mediator or panel of mediators to work through a solution with all sides to the dispute. The process typically involves a series of meetings where the mediator tries to facilitate a settlement.


Decisions by the mediator are not binding, although agreements reached in mediation may be, just as any contract would be. Some love mediation because it brings to the settlement process a third-party, who can provide a disinterested reality check for both sides. If a settlement can be reached, both parties can save a significant amount of time and money.


Some disputes use a variation on standard mediation. It begins with mediation, but both parties agree ahead of time that any unresolved issues will be submitted to binding arbitration. The knowledge that binding arbitration will occur serves as an incentive to both parties to resolve their differences in mediation. In most cases, the mediator also serves as the arbitrator.


Mediators are typically volunteers who are not paid for their services.


Mini-trials. Mini-trials combine elements of both arbitration and mediation. Like arbitration, mini-trials involve the presentation of evidence to an impartial third-party. Like mediation, mini-trials are intended to enhance the settlement process. The impartial third-party may issue an opinion, but it is typically nonbinding, unless the parties agree otherwise beforehand.


One aspect of mini-trials, indeed one aspect of all of ADR, is that it turns the notion of secrecy on its head. In a trial, a party may withhold information to gain a tactical advantage with a surprise witness or document. In ADR, the idea is that the more you know about the other party's strengths and weaknesses, the more likely it is that you'll be able to reach an amicable settlement. Thus, mini-trials are designed so that both parties are expected to put all their cards on the table.


Summary jury trials. The ADR techniques previously discussed are generally extra-judicial, which means that they take place outside of the judicial process. Summary jury trials, on the other hand, are typically managed by the trial judge, who may assign a magistrate to oversee a shortened version of the full trial. In summary jury trials, a jury of six people (the standard jury is 12 people) hears a shortened version of the evidence that will be presented at the full trial. In most cases, for example, testimony from witnesses is not taken.


The jury renders a nonbonding decision, and the parties use that decision in further settlement negotiations. Summary jury trials can be particularly effective if one of the parties is being unreasonable in settlement talks. A summary jury verdict can sometimes force the unreasonable party to see the error of his settlement position.


This IS NOT intended to be legal advice or in any way replace the advice and judgment of a licensed lawyer. Every case and situation is unique and only a licensed lawyer can offer legal advice which is appropriate for your situation