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Alternative Dispute Resolution (Arbitration (Advantages (It is cheaper…
Alternative Dispute Resolution
Arbitration
Arbitrator hears both sides before making a decision
Arbitration decisions can be enforced through courts if someone refuses to pay up after losing
If there is a dispute on how it should work, then courts are involved based on the Arbitration Act 1996
They sign a contract saying they'll accept the judgement of C
Parties can set up their own rules about how to settle the dispute
Parties submit all their arguments to the arbitrator who makes an unbiased decision
If this method is used then courts will deal with it after it is completed
Advantages
It is cheaper than going to court
It is more relaxed and inforal
It is quicker then going through a court hearing
Decision is unbiased
It is deal privately which means the public wont know
Award is final and can be enforced through courts
Hearing time set benefits both parties
Disadvantages
If a formal hearing occurs, it will be expensive
Rights of appeals are limited
Hiring a professional arbitrator is expensive
Delays for commercial and international can be longer than those in courts if a professional arbitrator is used
Legal point may occur which is not suitable for a non-lawyer arbitrator
Mediation
It is only suitable if both parties are willing to cooperate
Companies are most likely to benefit
They can be asked for an opinion on the merits
It is also used in family disputes
Mediator is a neutral and can't express their thoughts
Disadvantages
Amounts received in mediated settlements are lower amounts that can be received in court
If there is no experience then mediation is able to be a bullying exercise
There needs to be a skilled mediator and conciliator
This means there can be a settlement may occur with the weaker party
There is no guarantee that the issue will be resolved
Mediator attempts to reach a compromise between two parties
Advantages
Decision is based on common sense
It is easier for companies to conduct business in the future
Compromise cannot happen unless an agreement occurs
It can avoid conflict in the courtroom as there is no winner/loser
Parties can leave the process at any point
Conciliation
They go over the issues to understand the situation
Will normally suggest a ground for compromise and the basis of a settlement
The conciliator has a more proactive role
Has no authority has not authority to call in witness or recall evidence
This is where a third party conciliator is hired to resolve the dispute
Disadvantages same as mediation
Advantages same as mediation
Negotiation
Two parties will try and settle their dispute
If they cannot conclude an agreement then hiring a solicitor may be the next step
This is a verbal method
Disadvantages
It is not suitable when both parties won't cooperate
Means there will be no resolution
This means that other ADR methods will be used
If there are multiple unsuccessful negotiations then it will delay the whole issue
Sometimes it does not always work
Advantages
This can also be done in mediation and conciliation
Can be used at the start or the end
Can also include further agreements concerning business
Can do it independently
It is very cheap
It can be used at any point
There is no need for lawyers which means it can be done by two parties