These days, relatively few legal disputes are resolved by going to trial. The clear majority are resolved outside of the courtroom as a result of what’s known as alternative dispute resolution (ADR). ADR is actually a broad class of strategies for avoiding trial, but the most common forms of ADR are negotiation, mediation, and arbitration. This post provides an overview of these three strategies and examines their advantages and disadvantages.
Overview of Negotiation, Mediation, and Arbitration
Negotiation is such a natural part of pursuing a personal injury claim that many people may not think of it as a form of ADR. But in reality, it is easily the most common and least formal method of resolving disputes out of court.
From the moment a defendant or insurance company makes an offer to an injured plaintiff, or the moment when the plaintiff makes a demand on the defendant or insurance company, the parties are engaged in the process of negotiation. The evidence that each party compiles, as well as that gathered through the formal discovery process after a lawsuit is filed, is intended not only to provide the basis for prevailing in court, but also to encourage the other party to settle before the case goes to trial.
The process of negotiation continues throughout the life of a claim. Many cases are even settled the day that the parties are set to go to trial, and some are even settled after trial while waiting for the jury to return its verdict. Obviously, negotiations are an important part of every personal injury case, and often suffice to resolve the parties’ dispute.
Mediation is a process in which a neutral third party (the mediator) tries to help the parties to a conflict settle out of court. The parties choose the mediator and agree to meet with him to discuss their case. The mediator cannot force the parties to settle, but can offer his or her opinion as to the strengths or weaknesses of each party’s case.
Mediation is typically more formal than simple negotiation. And, because it involves a third party, it is also more expensive. However, the perspective of a neutral outside observer often helps the parties discover that settlement is in their best interest.
Arbitration, while less formal than a court trial, is more formal (and expensive) than either negotiation or mediation. In an arbitration, the plaintiff and defendant present their cases to one or more neutral third parties (the arbitrators), who resolve any questions of fact and law and issue an award. If that sounds to you very similar to a judge rendering a judgment, that’s because it is. Arbitration is a lot like a private, streamlined version of trial, complete with a discovery process and rules of evidence.
An arbitration award can be binding or non-binding. If it’s binding, the prevailing party can enforce the award in court if necessary, and the possibility of having the award overturned by a court is limited. If it’s non-binding, the parties remain free to pursue resolution of their dispute in court.
Advantages and Disadvantages of ADR
ADR offers several potential advantages. First, it is generally less expensive than going to trial. Second, it is generally faster than going to trial. Finally, it allows the parties to compromise their claims without the risk of losing after the expense and delay of trial.
But ADR also has some potential disadvantages. It may not be less expensive or faster than trial. It doesn’t allow the parties to present their claims to a jury of their peers. A party may be able to recover more by going to trial. And in cases where a consumer is suing a company and that dispute is subject to a contractual arbitration clause, the company has likely chosen an organization to provide arbitration services with which it—and not the consumer—is most comfortable.
Regardless of the relative advantages and disadvantages of ADR in particular cases, these procedures form an important part of modern personal injury claims. That’s why it’s important to have personal injury attorneys who are comfortable fighting on your behalf both in and outside of court. That’s why it’s important to contact Costa Ivone, LLC.