Other Dispute Resolution
Not all commercial and other types of disputes between parties are resolved by Court proceedings. Many commercial disputes and other disputes are resolved before Court proceedings are commenced and the need to go to court, which is an expensive step, is avoided. Even after Court proceedings are commenced, most disputes are resolved before there is a trial or final hearing. On other occasions, disputes are resolved by one person giving up and walking away from Court Proceedings. This may mean that a plaintiff discontinues a claim against a defendant or that the defendant does not actively defend the Court proceeding, leading to a default judgement against the defendant before the matter reaches a trial or final hearing.
Informal negotiations
Other matters are resolved by informal means such as the exchange of an offer and acceptance of an offer by correspondence or email communications. Sometimes the parties even resolve the matter between themselves without reference to their lawyers or requiring any action by their lawyers.
Other disputes are resolved by processes that are commonly called alternative dispute resolution. These alternative dispute resolution processes include formal settlement negotiations, mediation, or arbitration.
Formal negotiations
Formal negotiation may include or build on initially unsuccessful informal attempts at negotiation such as making an offer. However, it may be necessary for the parties and their lawyers to meet and participate in a joint meeting to discuss disputed issues and options to resolve the dispute before the parties can find a middle ground and agree on the terms of settlement.
The difficulty with reaching terms of settlement by this means is that parties start from entrenched positions before Court Proceedings are commenced. The filing of court documents such as statements of claim and defences further entrench those positions.
Lawyers are trained to be advocates for their clients and to advance or protect their client’s position and interests. Although any lawyers involved in dispute work are good negotiators their training and experience advocating for a party does not necessarily sufficiently equip them to assist their parties moving from entrenched positions in a manner that increases the prospects of a settlement of the dispute.
Mediation
For this reason, mediation is the preferred means of resolving disputes in most situations. The parties recognise the need for a third party as a facilitator. The benefits of the role the mediator plays are as follows:
- The mediator is independent and impartial. Both parties can trust and open up to an impartial third party who is not there to judge them or their positions;
- The mediator does not represent or advise either party which allows the mediator to assist both parties to communicate with each other;
- Each party is able to speak confidentiality with the mediator and make concessions without it being used against them;
- The mediator is able to reality test the parties, meaning that the mediator can ask questions, that a lawyer for a party may not ask, to encourage a party to look at the dispute from another point of view;
- The mediator speaks to both parties and speaks confidentiality to both parties. In a mediation the mediator is the only person who sees all the terrain. This gives the mediator a unique role and advantage in facilitating the mediation process and assisting the parties reaching a settlement of the dispute.
In our experience most dispute matters in which we have acted in the last several years have been resolved though the mediation process.
Arbitration
Another alternative dispute resolution option open to the parties is arbitration.
Unlike the mediator, and similar to a judge, an arbitrator makes a decision called an award that is binding on the parties and enforceable in the courts.
The benefit of the arbitration process is that the parties can agree on what dispute or disputes the arbitrator should consider and decide upon and decide on the process to be followed in the arbitration. An arbitration may result in an award more quickly and less expensively that adjudication by the courts.
If you require assistance to resolve a dispute you should consider alternative dispute resolution. Our consultant Bill Morgan is a nationally accredited mediator and a member of the resolution Institute and of the Chartered Institute of Arbitrators.
