Common methods of dispute resolution in Australia.
Dispute resolution is an umbrella term which covers many methods of resolving conflict
The purpose of dispute resolution is to solve problems between people or between people and companies. Dispute resolution can broken down into two sub-categories; adjudicative and non-adjudicative. Adjudicative dispute resolution involves the involvement of a third party to formally determine the outcome of the matter such as, the court or tribunal. Non-adjudicative methods is more informal and involves negotiating with the other party through alternative dispute resolution.
The court process is often costly, stressful and time consuming. Depending on the kind of dispute you have, it may be cheaper and more efficient to first engage with alternative dispute resolution.
Non-adjudicative forms of dispute resolution are where the parties attempt to come to a mutual agreement. This is also known as alternative dispute resolution. These processes are informal and the parties have more control over the outcome.
Some common methods of non-adjudicative dispute resolution are:
Usually, this is the first step someone would take to resolve a dispute. Methods under this heading can be as simple as speaking (or preferably writing in case evidence is needed down the track) to the person or company they have a dispute with.
This is one of the most common forms of alternative dispute resolution. Mediation is a confidential process involving a neutral third party (the mediator), who works with the parties to resolve the dispute. They do not offer legal advice, propose agreement or determine who has a stronger case. Their role involves helping parties identify the real issue(s) in a dispute and facilitating productive conversation between parties to reach a mutual agreement.
Power imbalances between companies and an individual can be avoided by placing each party in a different room. The mediator will go between room to relay information and any proposals.
Participation in mediation is usually voluntary; however, most NSW, ACT and Federal Courts will require parties to mediate before setting a final hearing date. In this situation, the parties must take part in mediation on a genuine and constructive basis.
For more information, please visit our blog “Mediation: What is it, and why use it?”
Conciliation is similar to mediation. The main differences are that a conciliator often has expertise in the subject matter any can provide expert advice or information. A conciliator is also able to suggest potential agreements. Conciliation is commonly a routine part of proceedings before NSW, ACT and Federal Tribunals.
The parties present their case and any supporting documents to an evaluator (whom is usually a judge, barrister or tribunal member). The evaluator will estimate the parties’ likelihood of success at trial. The evaluation is not binding;however, it can be used as a starting point to negotiate settlement.
During the process, what is said by parties cannot later be used against them in any proceeding (there are very limited exceptions).
Adjudicative methods of dispute resolution are formal and often require engaging a lawyer. The outcome lies in the hands of a third party. The two most common adjudicative methods in NSW and the ACT are arbitration and litigation.
Arbitration is a confidential, court like process where the outcome is determined by an arbitrator appointed by the parties. The parties and the arbitrator are able to determine how the arbitration process will be carried out in light of the facts of the circumstances. Unlike methods used in alternative dispute resolution, the arbitrator’s decision is binding.
Arbitration is most commonly used with commercial and construction disputes.
Expert determination is similar to arbitration. It is a process where parties present their case to an individual with expertise in relation to the dispute. The parties are able to agree on a individual. Once a decision has been made, it is binding between the parties.
However, the process of expert determination is slightly less formal than arbitration. There is no strict procedural rules and the court has little control – it is largely in the hands of the parties.
For more information, please visit our blog “Expert Determination: What is it, and why use it?”
Litigation – especially court proceedings – is the form of dispute resolution which most people are familiar with.
Litigation is the process of bringing a lawsuit. It is a costly and time consuming process which is why it is often recommended as the last option. Litigation can begin in either the court or tribunal. Out of the two, tribunals are more cost effective and more flexible.
If you are considering litigation, we strongly recommend you contact an experienced litigation lawyer. If your case has good prospects but, is not presented properly, you may lose the case and the court can order you pay the costs of the other party’s lawyer.