What is Alternative Dispute Resolution (ADR)?
Alternative Dispute Resolution (ADR) is an area of law devoted to solving disputes without utilizing the traditional means of a court trial. Due to court backlogs and other factors, litigation is time-consuming and very expensive. ADR is often a much shorter and more cost-effective process, which makes it appealing to many clients, especially business owners.
Many times, the parties can work out a settlement using alternatives to litigation such as:
- Negotiation
- Neutral evaluation
- Conciliation
- Mediation
- Arbitration
Even though ADR is a less formal process than litigation, its results can be legally binding and therefore, it is critical to work with an attorney who is competent in handling these types of disputes to protect your business interests. The attorneys of The Kumar Law Firm are knowledgeable in all forms of ADR and can offer insightful representation to business clients involved in a dispute or litigation.
Types of ADR
Negotiation
Negotiation is the most common form of ADR. Negotiation is the process of parties formulating settlement agreements and proposing them to the other side in the form of an offer. The opposing side usually makes a counteroffer and this process continues until a deal is reached where all parties are satisfied. One benefit of negotiation is that it leaves the parties in control.
Negotiation is an acquired skill, so it is important to have a capable attorney represent you in this process. The negotiating attorney must:
- Be intimately acquainted with the facts and circumstances of the case
- Understand the terms their clients are willing to offer and accept
- Make it a priority to evaluate the strengths and weaknesses of the case from the perspective of each party
- Determine what leverage they may have when negotiating the deal
The Kumar Law Firm’s attorneys have the ability to negotiate for our clients in all types of business matters.
Early Neutral Evaluation
Early neutral evaluation is the process whereby an unbiased attorney:
- Reviews the case from one client’s perspective
- Determines what the best and worst outcomes may be
This valuable tool is used frequently by business owners and often encourages the settlement of business disputes.
Business Dispute Mediation Lawyer
Mediation is a popular form of ADR that is frequently used in business disputes. During this process:
- The parties to a dispute meet
- A neutral mediator referees their negotiation
- The mediator encourages communication and may assist in formulating settlement offers
The purpose of mediation is to get the parties to voluntarily agree and is therefore generally non-binding. Sometimes a Judge can order the parties to go through Mediation prior to a full trial, very often in family disputes. In some of those situations, the outcome of Mediation can be binding on the parties.
Contact Our Austin Business Dispute Arbitration Attorney
Arbitration is a form of ADR that is similar to a trial in some ways. Arbitration is an adversarial hearing where the parties can call witnesses and present evidence to a neutral arbitrator. The rules of discovery and evidence are relaxed to make it a shorter and more cost-efficient process. This process is often conducted by an attorney or retired judge who works for a private arbitration company. The parties often have the option to participate in selecting the arbitrator. A common misconception about arbitration is that they have a tendency to “split the baby”. In reality, most decisions rendered by arbitrators are significantly in favor of one party over another. The decision of the arbitrator is binding.
Contact the Kumar Law Firm if you are a business owner involved in a dispute and contemplating ADR as a means of settlement.