RLD - Alternatives to Litigation (Lesson)

Introduction

Resolving issues or disputes through the courts is not always the best way to find the solution to or resolve the dispute. Court processes can take a lot of time and can be very costly for all parties involved. In addition, you may not get the result you were hoping for if you go through the court process. It is often more effective, easier, and less costly for the parties to negotiate a settlement themselves. Working together, the parties can oftentimes reach a mutual agreement or solution. In this microlesson we will review some of the avenues of dispute resolution.

Key Terms

Alternative dispute resolution (ADR) – when parties try to resolve disagreements outside of the usual adversarial system by using creative settlement techniques

Litigate – to allow a court to resolve a dispute

Mediator – an independent third party who tries to develop a solution acceptable to both sides of a dispute

Arbitrator – an impartial person given the power to resolve a dispute by hearing each side and coming to a decision

Arbitration – a process similar to an informal trial where an impartial third party hears each side of a dispute and issues a decision

Hearing – a proceeding in which evidence and arguments are presented, usually to a decision maker who will issue a ruling

Mediation – A collaborative process where a mediator works with the parties to come to a mutually agreeable solution

Alternatives

Disagreements are a part of life as well as normal occurrences in the day-to-day operations in the business world. How those differences, disagreements or disputes are handled can make a huge impact on the end result and on all parties involved.

Litigation

Litigation is an option for handling disputes. Through litigation you allow a court to resolve your disputes. The court also holds the authority to make the decision, one you may or may not be happy with. Many individuals and businesses seek alternatives to litigation to reduce the costs, stress, and formality associated with going to court. When one person injures another, one fails to keep a binding agreement, or in even more intense situations such as a high-profile labor dispute, divorce action, or contract negotiation, often the best solution is for parties to negotiate the settlement themselves through an alternative, creative settlement technique.

Alternative Dispute Resolution (ADR)

Alternative Dispute Resolution (ADR) has become an increasingly popular way to handle disputes without litigation. Some examples of ADR include arbitration, mediation, and negotiation. These methods are generally less costly and take much less time than a formal litigation process. These processes are often collaborative and allow the parties to understand each other’s positions.

For more information on alternative settlement techniques and a comparison to litigation, review the ADR Summary report, linked below.

Click here to access and read the ADR Summary Report Links to an external site.

Let's Review!

Take a moment to participate in the following activity to practice your understanding of the topics in this module.  Reach out to your instructor if you have any questions.

Final Thoughts

Alternative methods to resolving disputes outside of the formal court process are relatively quick and less expensive. Individuals as well as business professionals increasingly prefer alternative methods over the formal litigation processes.

These processes allow parties to meet one on one to solve disputes or to work through a third impartial party.

Depending on the method, decisions can be purely advisory, non-binding or they can be binding and enforceable in a court of law. Alternative methods are used in all types of disputes varying from minor contract situations to more involved situations such as labor disputes. It is important to compare your options in regards to your specific situation when deciding which dispute resolution method to use. This will help to best meet your objectives and to obtain satisfaction of results for all parties.

 IMAGES & PRESENTATIONS CREATED BY GAVS