Alternative Dispute Resolution (ADR) in the United States

Definition of Alternative Dispute Resolution (ADR)

Settlement of civil disputes by means other than trial. The move to alternative dispute resolution (ADR) was prompted by a number of factors, but largely the time, expense, and complexity associated with trials. Read more about the definition of Alternative Dispute Resolution in the legal Dictionaries.

Alternative Dispute Resolution Methods

Several techniques of dispute resolution are currently used; most have existed for some time. What has changed is that courts are now endorsing use of these alternatives and, in some cases, even ordering parties to avail themselves of one of these methods before accessing the judicial process. The most common techniques are mediation and arbitration. Mediation is generally nonadversarial and uses a third party to aid parties in seeking a voluntary settlement. Mediation does not involve fact-finding as such. Rather, reconciliation of differences is the objective. Arbitration, on the other hand, uses a third party, possibly a panel of three or more people, to hear arguments and render a judgment. If the arbitrator’s decision is not satisfactory to the parties, the dispute may then be tried. Another ADR technique involves assignment of a judge to examine settlement positions of parties in an effort to facilitate agreement. The settlement judge is a regular judge assigned to a case upon request of the parties. Another method of resolution is the use of minitrials. Here parties meet with a judge in conference and exchange summaries of their respective positions. Such hearings tend to be quite abbreviated; they can usually be concluded in a day. Decisions based on these hearings follow shortly thereafter. (1)

Analysis and Relevance

The various techniques of alternative dispute resolution are attractive to disputants. The current emphasis on ADR, however, is largely a response to the incapacity of the civil courts to keep current dockets. Civil litigation is often complex and expensive. It is also the case that civil courts are badly backlogged. Many civil disputes must wait in excess of three years from filing to trial. As a result, many attorneys and businesses who are frequently involved in legal disputes have supported use of alternate ways to settle disputes because they are faster and less expensive. The courts have also embraced ADR. Trial courts at all levels frequently order its use, especially mediation or arbitration, before a case can be docketed for trial. Thus, ADR has been extensively assimilated into to existing judicial structure. Furthermore, a large number of ADR programs have been created legislatively, which reinforces the present trend toward institutionalizing ADR. (2)

Alternative Dispute Resolution Benefits in case of Cour Crisis in California

by Mike Rosen (2011)

The 2011 fiscal crisis in California led to $350 million in permanent budget cuts for the state’s court system. Judicial staff was being laid off, some courtrooms were closing, and the wait time to trial for civil cases was expected to grow to five years – or longer.

Although common logic suggests that public and private alternative dispute resolution (ADR) services will spike in popularity as frustrated parties seek other options, the reality is less clear: A backlog of civil cases may embolden some defendants to avoid settlement efforts entirely. At the same time, state courts are being forced to cut back their publicly funded ADR programs.

“[Public] ADR is a strange thing, because at once it’s part of the problem, in that it’s an additional expense that courts can’t afford,” says Robyn Crowther, a civil litigator with Caldwell Leslie & Proctor in Los Angeles, “but it could also be part of the solution, in that it could help reduce [judicial] caseloads.”

Many neutrals expect to see an eventual uptick in the use of private ADR companies as parties tire of long waits for court time.

Some ADR specialists are already seeing such an effect. William “Bill” Eddy, senior family mediator at the National Conflict Resolution Center in San Diego, has noticed that more new clients are expressing frustration with the three- to four-month delays in family court caused by the initial round of court budget cuts announced in March. Eddy’s overall mediation caseload, however, has not risen, suggesting that some Californians are opting to live with their problems rather than pursue legal remedies. On the other hand, certain issues where both parties need closure quickly – like insurance claims and real estate disputes – will be increasingly settled through ADR, specialists believe.

“As this drags on, people will be more willing to arbitrate claims that previously they thought were important to have before a jury,” says Mia Blackler, a shareholder in Buchalter Nemer who works with its litigation and labor and employment practice groups.

A 2008 study of the U.S. Department of Justice found that 65 percent of cases settled when ADR was used, compared to only 29 percent using traditional litigation methods. Despite its success rate, ADR has historically been underutilized: About 3.3 percent of cases employed ADR, according to the DOJ study, and a 1997 report found that private ADR caseloads accounted for just 5.4 percent of California’s total civil disputes. In Los Angeles Superior Court, less than 10 percent of eligible cases went through the court’s ADR option last year.

Those figures could be changing now that ADR holds out hope of a faster, cheaper alternative to a court date that might be years away. Experts point out that ADR has some limitations: Agreements from closed-doors settlement conferences cannot be cited as legal precedent, and certain types of remedies – such as writs of attachment or injunctions – can be obtained only through the courts. Still, mediation and arbitration are sure to see plenty of overflow from California’s underfunded and overloaded courts.

Hesitancy to use Alternative Dispute Resolution among Attorneys

Though a majority of in-house attorneys believe that commercial arbitration can be better, faster, and cheaper than duking it out in court, only about 11 percent of business contracts include arbitration clauses, according to a report by the RAND Corporation.

Although alternative dispute resolution (ADR) clauses are common in consumer contracts, the study reflects an overall hesitancy to use arbitration in a business-to-business context–which may stem from a limited understanding of the process. For example, more than 70 percent of the 121 corporate counsel who responded to the RAND survey believed incorrectly that professional arbitrators tend to split awards rather than ruling for one party. In fact, the American Arbitration Association reported that only 7 percent of its cases were split in 2009. Respondents also expressed concern that arbitration involves greater discovery and premotion work than it used to, and that going that route makes it difficult to preserve the right to appeal.

Yet survey participants also recognized the positive aspects of ADR. Among the top benefits cited: Arbitration helps the parties avoid a jury trial, they have control over the arbitrator selection, and the proceedings are confidential.

Corporate Attorney views on ADR

Better than court 17%
Somewhat better 35%
Somewhat worse 13%
Worse 13%
No difference 12%
No opinion 6%

Note: Because some survey responses were left blank, percentages total less than 100.
Source: 2011 Business-to-Business Arbitration in the United States: Perceptions of Corporate Counsel, RAND Corporation

Alternative Dispute Resolution Definition

Alternative Dispute Resolution in Foreign Legal Encyclopedias

Link	Description
Alternative Dispute Resolution	Alternative Dispute Resolution in the World Legal Encyclopedia.
Alternative Dispute Resolution	Alternative Dispute Resolution in the European Legal Encyclopedia.
Alternative Dispute Resolution	Alternative Dispute Resolution in the Asian Legal Encyclopedia.
Alternative Dispute Resolution	Alternative Dispute Resolution in the UK Legal Encyclopedia.
Alternative Dispute Resolution	Alternative Dispute Resolution in the Australian Legal Encyclopedia.

The Use of Alternative Dispute Resolution in Intellectual Property Issues

This section examines the Use of Alternative Dispute Resolution in Intellectual property subject in its related phase of trial. In some cases, other key elements related to trials, such as personal injury, business, and criminal litigation, are also addressed.

Alternative Dispute Resolution (Agency Adjudication)

This section introduces, discusses and describes the basics of alternative dispute resolution. Then, cross references and a brief overview about Agency Adjudication is provided. Finally, the subject of Administrative Law in relation with alternative dispute resolution is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Alternative Dispute Resolution (Distributorships)

This section introduces, discusses and describes the basics of alternative dispute resolution. Then, cross references and a brief overview about Distributorships is provided. Finally, the subject of Business, Corporate Law in relation with alternative dispute resolution is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Alternative Dispute Resolution (Franchises)

This section introduces, discusses and describes the basics of alternative dispute resolution. Then, cross references and a brief overview about Franchises is provided. Finally, the subject of Business, Corporate Law in relation with alternative dispute resolution is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Alternative Dispute Resolution (Civil Procedure)

This section introduces, discusses and describes the basics of alternative dispute resolution. Then, cross references and a brief overview about Civil Procedurein relation to alternative dispute resolution is provided. Note that a list of bibliography resources and other aids appears at the end of this entry.