What Is Alternative Dispute Resolution?
As the name suggests, Alternative Dispute Resolution (ADR) is a way to resolve disputes. Prior to ADR, the traditional way to resolve disputes was to proceed to trial and let judges and/or juries decide cases. ADR provides parties with alternative avenues to travel to resolve disputes.
For decades, our justice system has seen an explosion of litigation to the point that courts now struggle to handle all of the lawsuits. This problem applies to both state and federal courts. As such, after much consideration, the Indiana Supreme Court adopted five forms of ADR. The five forms of ADR adopted the Indiana Supreme Court are:
1. Summary Jury Trial
3. Private Judge
Federal Courts allow for similar ADR, but this post will focus on ADR in State Court. Should you desire to resolve your dispute out of court, understanding each kind of ADR will help you decide which type is most proper for your particular case.
1. Summary Jury Trial
In a summary jury trial, attorneys for each side make an abbreviated presentation of their case to an actual jury who will render a verdict, which is typically non-binding. The presentations usually last a half or full-day. Live witnesses are seldom called to testify with the attorneys simply summarizing the evidence that would likely be presented in the case actually went to court.
One of the benefits of a summary jury trial is that, after the summary trial is done, the attorneys and parties interact with the jury and can ask the jurors why they reached their conclusion and which issues were most important to them. This jury interaction can lead to a quick settlement between the parties, thereby avoiding protracted litigation.
In a mini-trial, each attorney presents a short version of his or her case to the other side with a neutral judge maintaining order. No jury is involved. After attorneys present their clients’ cases, the judge then conducts a settlement conference between the parties to try to settle the case. Mini-trials are most effective for complex commercial and business disputes, as the mini-trials allow upper management to listen to both sides of a case and make a decision about whether to settle the case or proceed with litigation. Mini-trials can also be effective when there are trade secrets, copyrights, patents, and/or trademarks at stake to maintain privacy. Mini-trials can also be useful when both sides want to preserve an ongoing business relationship. A mini-trial can result in a case resolution long before a judge or jury would decide a case in a court of law.
3. Private Judge
Using a private judge to resolve a dispute can also be effective. This form of ADR is typically used when a judge has special expertise in a particular area and/or there are special evidentiary issues involved with a case. Once the parties select the judge, the evidence is presented to the judge in an informal manner, with the judge usually rendering a binding decision. Like all other forms of ADR, using this method of ADR saves the parties involved in a dispute time and money.
In an arbitration, the dispute is normally submitted to a panel of 3 arbitrators for a specific, and usually binding, decision. If the panel consists of 3 arbitrators, each side picks an arbitrator and then the 2 arbitrators pick a neutral 3rd arbitrator. Some agreements (i.e. insurance contracts) require a dispute be resolved by arbitration and not by the traditional court system.
Once an arbitration date is set, each side sends briefs to the arbitration panel outlining their positions and, thereafter, the arbitration panel will hold a half-day or full-day hearing listening to witnesses and arguments by the parties. Rules of evidence are typically suspended, thereby leading to a more an informal hearing than what would occur in court. Parties typically select this form of ADR when there are complicated and/or technical issues involved that a judge or jury may have a difficult time comprehending. It is also a good avenue to travel when the parties want to avoid publicity. In Indiana, arbitration is the second most popular form of ADR, second only to mediation.
By far, mediation is the most popular form of ADR. In mediation, a neutral third party, a “mediator” (typically an attorney), encourages and assists both sides to resolve their dispute without prescribing what the actual result should be. The mediator is not a decision-maker, but rather a facilitator whose job is to help each side consider its strengths and weaknesses in order to resolve the case. Mediation has become so popular that now most courts will schedule a trial date until the parties go through the mediation process. According to statistics, cases are resolved in mediation 80-90% of the time.
In mediation, both sides agree to a mediator and a date for the mediation session. After the mediation date is selected, both sides provide to the mediator a confidential mediation statement outlining their respective positions. The parties then gather at the mediator’s office for, typically, a half-day or full-day mediation session. Sometimes opening sessions are held in which each side can present its position to the other side. On the other hand, both sides can waive an opening session and get right down to settlement negotiations with the mediator.
If a settlement is reached at the conclusion of a mediation session, the agreement is reduced to a written document which becomes a binding contract and is enforceable in a court of law. If a party tries to change its mind after signing a mediation settlement agreement, the other side can enforce the mediation agreement in court.
Some of the reasons why mediation is the most popular form of ADR in Indiana is that it not only saves the parties time, effort, energy, and money but also provides the parties the added benefit of a neutral evaluation from the independent mediator. Mediation also provides the parties their “day in court” by telling their side of the story to the mediator. Each client has significant input into the settlement negotiations and the mediation session is entirely confidential. Even if no settlement is reached during mediation, it can result in the elimination of various issues or result in the exchange of information between the parties that may lead to a quick settlement following the mediation session.
Given the fact that mediation has proved to be the most popular form of ADR, Barrett has established its own Mediation Center and has attorneys who specialize as mediators including Kevin K. Fitzharris, James Koday and James J. O’Connor. Should you wish to schedule a mediation session with one of our attorneys here at Barrett, or schedule another form of ADR, please do not hesitate to contact us. We look forward to working with you in the future!