Alternative Dispute Resolution Process

In business law there two main types of processes that used to resolve a dispute. One is going through the traditional court system and the second is an alternative dispute resolution. The alternative dispute resolution is the most common process used to settle disputes. However, the alternative dispute resolution process uses several different methods when coming to a settlement. The most common method is the arbitration method. The other form of methods is negotiation, mediation, conciliation, mini-trial, fact-finding, and judicial referee. The two alternative dispute resolution methods I will be discussing are arbitration and negotiation.

The alternative dispute resolution process can either be a long process or short process depending on the negotiations and if a settlement is agreed upon. There are some cases where the alternative dispute resolution process doesn’t always work and the dispute does go to an actual traditional court system. In most circumstances, the dispute settles out after a few negotiations between parties. Generally the process works when the plaintiff ( the accuser) goes after a party and/or form of business, therefore, the defendant (accused). This alternative dispute resolution process keeps the dispute more private and nothing will be shown in open court. The plaintiff will normally demand some type of settlement depending on the circumstances it could either be money, shares in a business, dispute of ownership, etc. The defendant will either argue of such dispute or try to settle with an offer of money towards the plaintiff this is known as the negotiation method. However, in some cases both parties (plaintiff and defendant) will have a neutral party handle both sides known as the arbitration method. Once both parties have come to an agreement which is also known as a settlement agreement then the dispute is finalized and closed.

The negotiation method is a process in which both parties’ debate and/or dispute to try and come to a voluntary settlement agreement over the dispute. When the negotiations start it can take several hours to several months depending on the situation and if both parties agree upon the terms of which the plaintiff and/or defendant agree by request. There are times when this method can cost a business so much money that they can’t afford to keep negotiating due to legal and finance situations. 

The arbitration method exists when both parties agree to a neutral party handling both sides of the case and finalization of the settlement. This is the most common method because of its effectiveness and neither party has to face each other in person and pay for their own attorney to represent their business. Using a neutral party to handle both sides’ cuts on costs and time. “Arbitration enables parties to avoid juries. n43 Most business courts permit jury trials, n44 although parties may be able to waive their right to jury trial by contract. n45. Dispute resolution in business courts is a public process, with parties' privacy protected only by the power of the courts to enter protective orders. Arbitration is a private [*500] process and more likely to result in a confidential resolution of the parties' dispute” (Drahozal, p. 1 2009).

Overall the alternative dispute resolution process has been a successful method over going through the traditional court system. Through the arbitration method, it keeps businesses out of the public and keeps the dispute privately. In most businesses don’t like to go to open court they prefer to keep things quiet and in-house.

References

Drahozal, C. R. (2009). BUSINESS COURTS AND THE FUTURE OF ARBITRATION. Cardozo Journal Of Conflict Resolution, 10491