The Essay On Alternative Dispute Resolution In Business, Consumer, And Commercial Matters.

Essay Topic: It is more effective to resolve disputes in domestic and international business, consumer and commercial matters through court proceedings rather than alternative dispute resolution (“ADR”). Do you agree with this statement? Discuss

1: Apply key principles of law for commerce to recognize and evaluate legal issues.

2: Analyse and interpret legal issues in domestic and international contexts.

3: Use appropriate digital technologies to search, retrieve and apply relevant information to law for commerce.

Key Principles of Law for Commerce and Legal Issues Recognition

While solving conflicts, alternative dispute resolution can complement any justice system of a given country making it more efficient. Other than that, the process is cheap, and it saves the couples most of their time and expenses. For example, many parties waste lots of money and time hiring lawyers and filing suits. Additionally, ADR increases the satisfaction of its users, and it leaves the relations of the parties smooth. From the side of litigation, it's for a rare cases when parties remain in close relationship after the settlement of their case. Besides all those, there is a proof that ADR can enhance the efficacy of courts by decreasing burden of cases. For a clear analysis, this paper will be an examination the effectiveness of ADR in domestic, international and commercial disputes.

ADR is described as a conflict solving procedure that offers a comprehensive alternative to litigation. Unlike lawsuits, ADR brings in a third party to help the conflicting parties reach an amicable solution.  There are different types of ADR procedures. To name them, one of them is a negotiation. This one is a method that takes a form of voluntary communication. The conflicting parties talk among themselves and a mutually reach an agreement. Notably, negotiation is classified as a preventive method of ADR, which can also be called a conflict prevention processes.

The second method of ADR is mediation. This one is a process where the conflicting parties involve the help of an independent and neutral third party. Like negotiation, mediation is classified as a facilitative process due to the presence of a third party. Markedly, the role of the third party is to facilitate but not to give any advice or determination.

Thirdly there is conciliation. This one is the most popular process used by Labour Relations Commission while solving industrial disputes. Besides, it’s extensively applied in resolving disputes in the construction industry.  The method is classified as an advisory process. It calls in the help of a third party who assists the participants to evaluate the problem, and he/ actively support them in reaching a mutual agreement.

After conciliation, there is arbitration, which is also classified as determinative ADR method. Among others, all determinative methods involve a third neutral party who listens to both sides and determines a case. Other examples of determinative processes are an adjudication, plus expert determination.

The named above methods are the most popular, but there is another classification called Collective ADR. This method is popularly utilized in disputes of multi-party scenarios where they don’t want to use litigation. One example is Ombudsman Schemes. Lastly, there is  Judicial ADR procedure. These are dispute resolution methods usually occurs when the parties file a suit, but they decide to settle during the litigation process.

Evaluation of Legal Issues in Domestic and International Contexts

ADR procedures are often established as an attempt to accomplish the objectives and policy goals. For instance, in Ireland, ADR methods such as conciliation and mediation form a part of statutory systems (Cox, 2012). Similarly, in Australia, the Australian Conciliation & Arbitration Commission has the mandate to oversee the application of ADR process. As far as there are various methods of ADR, their extent of application is also different among countries. Some countries have ADR as a center in a certain location, and others have it as an enormous network all over the country.

ADR can handle various types of conflicts. Disputes can range from employees vs. management, consumer vs. commercial, to government vs. government. Such conflicts make ADR a beneficial area, and they also create a ground of examination of its effectiveness. For example, while studying the efficacy of ADR, various methods and applications may yield different results creating a complicated conclusion.  For instance, a legal remedy of ADR solution can differ from another different jurisdiction remedy depending on the local laws. All the same, ADR has effectiveness can be traced from various instances

Various works have found ADR cost saving particularly when it’s used to solve domestic disputes such as employees vs. management. For instance, (American Arbitration Association, 2010) stated that “ADR methods that surface and resolve disputes informally at an early stage and use mediation or arbitration when third party intervention is needed avoid much of the cost normally associated with litigation.” ADR methods like mediation and negotiation enhance the possibility of parties meeting a mutually harmonious decision. In like the same manner, arbitration is a bit more predictable when compared with litigation. That is because arbitration has a likelihood less harsh judgment that that would come from the trial. For example, when solving domestic disputes using ADR, parties experience flexibility and reduced costs of arbitration, mediation, and negotiation among others.

On the side of international conflicts, these benefits even become larger. There is a reduced cost of the need for the parties to cross national borders. Furthermore, there is an enormous battle with the judgment when a foreign court settles the matter. In (Campbell, 2010), he states that numerous parties usually avoid situations where their case would be heard by a court located outside their country and in particular the other party's court. One party fears that the other party's court will decide the case following favoring the company residing within. As a result, you'll find that for numerous times and several reasons, arbitration is becoming more popular than litigation. For example, most of the parties to an international commercial dispute are opting for arbitration rather than litigation. Besides, most parties avoid litigations since they take too long, like what happens in England and the United States. Also, the process is quite costly and leaves a fairly hostile relationship between the parties.</p

The Role of Digital Technologies in Searching and Applying Relevant Information to Law for Commerce

While evaluating the effectiveness of ADR, it's an interesting thing to evaluate the time taken in resolving a dispute. After that, then it would also be good to compare the same time with a litigation process. Such time taken is also called time to disposition. It's usually the time between the filing of a case up to the date of the settlement. In (Amsler et al., 2009), the study found that ADR saved around 88 hours of employees time and around six months of the time it would have taken a litigation process per case.

Also, when comparing the effectiveness of ADR and litigation in consumer vs. commercial disputes, a study by (The Study Centre for Consumer Law – Centre for European Economic Law, 2007) came to the following conclusion, "Consumers are generally more interested in receiving a swift solution to their problems through direct negotiation rather than asserting their legal rights. For example, redress for a consumer could include delivery, repair, replacement, or refund of a product or service. Given that businesses tend to be repeat players‘ in direct negotiations with consumers, it has become common for businesses to set up and operate more formalized complaint handling schemes within their companies to deal with consumer disputes as they arise.”

The direct effects such as cost and time are easily measurable. There are also other benefits that participant can receive from ADR. Some of these direct benefits go to even an extent of helping non-participants. To name them, other benefits are like where an employee and the employer uses ADR, and the employee retains back his/her job.  Other impacts are the increased effectiveness of courts; this one can be a benefit to those firms going through the court. That is; they can decide to settle their case outside. Other advantages are the reduced number of suits in courts thus hastening the solution for those who are in the litigation process (Tarr, 2014).</p

Conclusion

There is enough evidence that ADR saves cost and time for the participants. Also, while some methods of ADR like arbitration offer final solutions, others like negotiations or mediation may fail, and the parties will end up going to court. With that, it would be advisable that policy makers can improve the effectiveness of judicial systems, and also maximize the awareness to the people that ADR can also reach the same solution that would have been offered by the court.

References

Cox, J. (2012). Business law. 5th ed. Oxford: Oxford University Press, p.378.

American Arbitration Association (2010). Handbook on employment arbitration and ADR. 2nd ed. Huntington N.Y.: Juris, p.51.

Amsler, L., Nabatchi, T., Senger, J. and Jackman, M. (2009). Dispute Resolution and the Vanishing Trial: Comparing Federal Government Litigation and ADR Outcomes. Ohio State Journal on Dispute Resolution, Vol 24(2). Available at: https://ssrn.com/abstract=1127878 [Accessed 25 Apr. 2017].

The Study Centre for Consumer Law – Centre for European Economic Law (2007). An analysis and evaluation of alternative means of consumer redress other than redress through ordinary judicial proceedings. Final Report, p.46.

Campbell, D. (2010). International dispute resolution. 1st ed. Alphen aan den Rijn: Kluwer Law International., p.8.

Tarr, G. (2014). Judicial proces and judicial policymaking. 6th ed. Boston: Wadsworth, Cengage Learning, p.220.