What is Alternative Dispute Resolution (ADR)?

What is ADR? 'Alternative' to what? The expression can mean different things to different people so it is important to be clear as to what someone means when they use it.  It can mean different things to different people. The Dispute Resolution Centre (DRC) suggests that 'ADR' includes all dispute resolution processes where the goal is to resolve the dispute without recourse to adversarial means.  We offer a range of different processes which are alternative to litigation, each of which is designed to respond to the particular needs of the parties in dispute in achieving realistic and cost-effective solutions to their problem.  

DRC will help you select the most appropriate means of resolving your dispute, or devise a hybrid to suit your particular needs, such as Med-Arb or Arb-Med.  You can select someone from our Panel of Neutrals (which comprises Mediators, Arbitrators, Evaluators and Experts) to assist you.   For more information, please contact us directly.  

Some simple definitions of the ADR processes which are most commonly used are listed below.  

Early Neutral Evaluation

An independent advocate, retired judge or other experienced individual gives an objective and independent view on the strengths and weaknesses of a case, and the likely outcome should the matter proceed to court.  The Evaluator's report often acts as a reality check and encourages the parties to seek a settlement of the dispute through mediation or straight negotiation.  

Expert Determination

Where a valuation or other technical point is relevant to a dispute, parties may opt for that element of the dispute to be determined by an independent third party acting as an Expert, The parties can agree in writing to be bound by the Expert’s Determination.  Expert Determination is frequently used during the course of a mediation or negotiation to provide a foundation for discussion.  

Mediation

Also known as 'assisted' or 'facilitated' negotiation.  Mediation is voluntary and confidential.  Disputants agree on the selection of a mediator who is neutral and unbiased.  The mediator will assist the parties reach their OWN mutually acceptable terms of settlement.  The terms are usually reduced to writing and signed by the disputants and the mediator.  A mediator will not impose any decision on those involved in the dispute.  If the parties do not agree, there is no settlement and parties may proceed to arbitration or litigation, or any other forum they prefer.  Mediation can take place during the course of an arbitration or litigation; if the parties reach settlement a judge should adopt their terms of settlement as a Consent Order.  The process is underpinned by the parties' full control of both the process and the outcome.  DRC Mediators are all accredited to international mediation bodies and operate according to a strict Code of Conduct.

Court-connected or court-annexed mediation: The provision of mediation services within the court system, accessible by would-be litigants.  Services may be fee-paying or, in some jurisdictions, subsidised by the courts so as to be low-cost or free of charge.  

Court-mandated mediation: A judge may order parties to attempt to resolve their dispute through mediation.  Mediation services may be provided within the courts or parties may seek the services of an independent mediation service.  

Mini-Trials

It is often the case that the decision-makers in a company (eg: Managing Director, Financial Director) leave disputes to be handled by their Legal Officers who actually may not have authority to settle the matter.  At a Mini-Trial, typically, the Legal Officers of the companies in dispute will present their respective cases to a Panel comprising decision-makers from each company and a mediator.  After hearing presentations from all sides to the dispute and thereby understanding the breadth of the problem, the decision-makers may feel that they are able to settle the matter through direct negotiation.  If so, they can choose to retire to their own negotiation or they can proceed immediately to a mediation with the mediator present.  

Negotiation

The preferable way of resolving differences because the disputing parties try to resolve the problem directly without assistance from anyone else.  We negotiate all day every day: in the market place, with our families, our work fellows … The problem with negotiation: there is a tendency for the one with the most power to win!

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The following processes are not strictly 'ADR' but are available as additional alternatives to litigation:

Adjudication

'Adjudication', although strictly meaning 'judgement' is also a term adopted by FIDIC (International Federation of Consulting Engineers) which refers to a specific process used by engineers in resolving construction disputes. Standard Adjudication clauses provide that, in the event of a dispute between the contracting parties, a pre-agreed adjudicator will give a decision on the element of the construction in dispute.  If neither parties raises an objection to the decision within 30 days, the decision becomes binding on all.  This process ensures that a dispute does not hold up unreasonably the progress of the rest of the project.  

Arbitration

In commercial practice, it is established practice for a standard contract to contain an arbitration clause requiring disputes to be submitted to arbitration for resolution.  The process involves the parties jointly selecting an arbitrator or panel of arbitrators – often expert in the field of the dispute – whose decision is binding and enforceable by the courts.  Only on very limited grounds is there any appeal against this decision to the Courts.  Arbitration is governed by the Arbitration Act of Kenya and conducted according to a strict Code of Conduct.  If parties cannot agree on the appointment of an arbitrator, the contract will state that the arbitrator will be appointed by a specified body eg: Chartered Institute of Arbitrators, Chief Justice, High Court.  In the absence of an arbitration clause, parties can agree to go to arbitration independently.  

Traditional African means of dispute resolution include forms of arbitration. For example, members of the community will abide by their Chief's decision or risk expulsion from the village.  However, if a member of the community does not want to abide by the Chief's decision, they may take the matter to court.  

Litigation: A claimant files suit in the court compelling attendance by the defendant.  Ultimately a judge gives judgement which is imposed on the parties and which is enforceable by the courts should any of the parties not fulfil their obligations under the judgement. 

 

‘We can't solve problems by using the same kind of thinking we used when we created them.’
Albert Einstein
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