«Alternative dispute resolution (ADR), typically denotes a wide range of dispute resolution processes and techniques that act as a means for disagreeing parties to come to an agreement short of litigation. Включає:
The main types of ADR – arbitration, negotiation and mediation.
Arbitration is a process in which two parties meet in the presence of a neutral third party, who is a specially trained arbitrator who listens to both parties and then makes a mandatory or optional decision for the parties, depending on what the parties have agreed in advance. (usually in a contract). In fact, arbitration creates a private judicial system. If one of the parties does not wish to comply with the terms of the decision, it is possible to compel that party to enforce the decision through state court.
International arbitration is used when the parties or subject matter of the dispute are in different jurisdictions. Usually, the parties enter into an agreement stating which international arbitration tribunal they can refer to in the event of a dispute. This type of arbitration is also used by governments to resolve international disputes.
Domestic arbitration applies if the parties are resident or have businesses incorporated in the same country, meaning that the dispute is settled in an arbitral tribunal in that country.
Mediation is a dynamic, structured, interactive process where an impartial third party assists disputing parties in resolving conflict through the use of specialized communication and negotiation techniques. Unlike formal litigation or arbitration, the parties reach an agreement during mediation -- the mediator does not decide on them.
Mediator is a third party (specially prepared mediator) neutral to the parties to the dispute, which helps the parties reach a mutually agreeable settlement while focusing on the parties' interests rather than legal positions or contractual rights.
Commercial mediation - the process of resolving disputes in the field of business relationships, corporate governance, etc. between the parties not subordinated to each other. Third-party independent mediators are involved in commercial mediation. The parties are guaranteed equal opportunities to choose an independent mediator.
Work-place mediation is a process of conflict resolution in which the parties to the conflict are representatives of the same organization and may be mediated by an internal or third-party independent mediator. Such mediation is part of the organization's conflict management system.
The main differences between ADR and litigation:
- 1. In the subject of the procedure: the dominant position of the parties themselves
- 2. In the subject matter of the procedure: the focus is not on the facts but on the real interests
- 3. During the procedure: flexibility and informality
- 4. In results and consequences: a mutually agreed solution jointly made by the parties.
Principles of mediation:
- 1. Volunteering
- 2. Privacy
- 3. The sincerity of the intention to resolve the conflict
- 4. Impartiality of the mediator
- 5. Jurisdiction of the parties
- 6. Informality and flexibility of the mediation procedure
Advantages of mediation:
- 1. Saving time
- 2. Reducing the cost of the dispute resolution process
- 3. Ability to influence the result
- 4. Confidentiality of the procedure
- 5. Ability to maintain or resume business relationships with partners
- 6. Possibility to prevent such conflicts in the future
7. Guarantee of execution of the decision (in case of successful mediation)
Comparison of major dispute resolution processes
|
Private negotiations |
Mediation |
Judicial review |
Basis |
Negotiation arrangement |
Mediation Arrangement |
Court claim |
Type |
|
Participation on a parity basis |
Competition process |
Beginning |
One party contacts the other on its own initiative |
At the request of a party, the UMC can contact the other party |
Announce of pretrial proceedings through the court |
Difficulties |
Absence of process manager |
To persuade the other party to initiate the procedure |
To determine the substance of the dispute; implementation of the decision |
Duration |
|
|
The other party may not appear in court -- the court hearing will be adjourned. |
The degree of control of the parties over the result and process |
High |
High |
Low |
Regulations |
Informal procedure |
Mediation rules and Mediator’s Ethical Code |
Procedural legislation |
The Role of Lawyers |
Ensuring cooperation or the competitiveness of the process, depending on the type of negotiations |
Collaboration is involved. Effective contribution to third party neutral negotiations. Legal registration of mediation results |
Ensuring the process competitiveness while exercising protection |
Role of neutral third party |
|
Mediation in negotiation and communication (mediator) |
Decision based on law (judge) |
Risks |
|
Lack of agreement |
Unpredictable result and complexity of the decision |
Procedure for formalizing the result |
Arrangement or contract |
Arrangement, agreement or contract |
Court order or court decision |
Relationships between parties |
Remain uncertain |
Improved |
May worsen and be broken |