Alternative Dispute Resolution (“ADR”) can be a cost-saving, efficient way to settle disputes among parties. Virtually any type of case can be resolved through ADR.
It takes a willingness by all sides to gather together, consider the strengths and weaknesses of each other’s case and, most importantly, compromise. The success of ADR is directly related to the time and effort every participant is willing to invest in reaching a conclusion.
There are two main forms of ADR: 1) mediation or, 2) arbitration.
Mediation is a process by which the parties come together in an informal setting (usually an office) with an independent third-party mediator who facilitates settlement negotiations. The parties will usually agree ahead of time that information exchanged at the mediation is for settlement purposes only and may not be used at trial. This leads to more open settlement discussions and alleviates concern that one party may hurt their case by exchanging detrimental information.
Each side participates in the selection of a mutually-agreeable mediator. The mediator is usually a retired judge or experienced attorney who is familiar with the type of case being mediated. The parties usually provide a brief written statement of their case to the mediator a few days in advance of the mediation. This allows the mediator to learn the facts of the case as well as each party’s position on settlement ahead of time.
On the day of mediation, the parties will gather in one room and briefly present their position to the mediator and all other parties. The parties then break out into private rooms. The mediator will meet one-on-one with each party and review both the strengths and weaknesses of their position, along with settlement demands and offers. The parties may request that the mediator keep certain information confidential until later in the mediation or for the entire mediation.
After meeting with each side, the mediator will go back-and-forth between the parties in their separate rooms, extending offers of settlement and new demands. During these meetings, the mediator will highlight the strengths and weaknesses of each side’s case in an effort to facilitate lower demands from the plaintiff(s) and higher offers from the defendant(s). The mediator’s goal is to bring the parties closer toward settlement each time he or she meets with them. While any party may withdraw from mediation at any time, it is important to remember that it may take several hours or, in some cases days, to reach a final resolution. A successful mediation culminates in both sides agreeing on a settlement or, at least, bringing them closer to an anticipated future resolution. It is important to remember that the final result may not be what everyone envisioned when they began the mediation, but it is a resolution they can live with.
Next time, we will discuss the other main form of ADR: arbitration.