Alternative Dispute Resolution (VIC)

What is this resource?

Alternative dispute resolution (ADR) describes a range of processes for resolving a matter outside of Court.

This resource will assist in identifying what alternative dispute resolution (ADR) processes may be appropriate for resolving a matter outside of Court and your role as a legal representative.

It is most time and cost effective to attempt resolution via ADR before commencing proceedings. However, ADR can be used at any time during the dispute, including before you start a legal case, while a case is going on or even after a court or tribunal has made a decision.

There are different types of ADR. This resource explains the most commonly used types: negotiation, mediation, conciliation and arbitration.

This resource includes:

• Negotiation
• Mediation
• Conciliation
• Arbitration

Mediation

Mediation is where an independent third party, the mediator, assists the people in dispute to identify the disputed issues, develop options, consider alternatives and try to reach an agreement.

Prior to entering a mediation process, you should provide legal advice on the client’s rights and responsibilities and what alternatives are available if you do not negotiate an agreement.

Mediation is the appropriate ADR where the parties:

• feel comfortable and safe having discussions with others involved
• want a third person to assist the discussion
• want to make the decision themselves
• want to maintain the best possible ongoing relationship with the other participants
• want to control the outcome, rather than asking someone else to decide the outcome
• want to keep discussions confidential
• want to find innovative solutions to a problem

The role of lawyers in mediation will usually depend on the type of case. For example, in disputes between individuals such as neighbours, there will be many types of issues to resolve that are not just about legal rights. In these types of cases, mediation generally works better when it is an informal process between the parties and the mediator, without the lawyer attending or, if they do attend, just listening but not taking an active role.

For large or complicated disputes that involve mainly legal issues, it is more common to have lawyers present and involved in the mediation process, although the focus remains on the people in dispute communicating about the issues and working towards a resolution.

Conciliation

Conciliation is where an independent third party, the conciliator, helps people in a dispute to identify the disputed issues, develop options, consider alternatives and try to reach an agreement.

Conciliation may be voluntary, court ordered or required as part of a contract. It is often part of a court or government agency process.

The role of conciliators is similar to that of mediators except that the conciliator may also:

• have specialised knowledge and give the participants some legal information,
• suggest or give the participants expert advice on the possible options for sorting out the issues in their dispute, and
• actively encourage the participants to reach an agreement.

Conciliation is likely suitable for your client if they:

• want to reach an agreement on technical or legal issues
• want assistance with the process
• want to make the decision with other participants involved
• want advice on the facts in the dispute

Conciliation may also be suitable if the participants have tried mediation and still cannot reach agreement with the other participants.

The participants legal representatives can usually be present during conciliation. In some cases, experts may also be present. Some conciliation processes do not require lawyers to participate. If lawyers are to participate in the conciliation process or experts are to attend, this is to be discussed with the conciliator before the process begins.

Arbitration

Arbitration is where the parties to the dispute present arguments and evidence to an independent third party, the arbitrator, who makes a determination. Arbitration is particularly useful where the subject matter is highly technical, or where the parties seek greater confidentiality than in an open court.

Arbitration may be voluntary, ordered by the court or required as part of a contract.

Arbitration can be a much more formal and structured process than mediation or conciliation. In some ways it is more similar to court, because at the end of the session the arbitrator makes a binding decision.

Some of the main differences between arbitration and other forms of ADR, include:

• the people in dispute need to agree before the process that the arbitrator’s decision will be binding and enforceable
• there is a much greater need to produce evidence and facts
• there may be one arbitrator or a group of arbitrators to hear the dispute
• the arbitrator may be a specialist in the subject matter of the dispute or have legal qualifications
• at the end of the process the arbitrator will make a decision for the parties

If an arbitrator makes a decision that your client is not happy with, they may be able to appeal to a court or other higher authority. However, this may be difficult and require your client to point to particular problems with the decision, such as it being biased or unfair.

If you or someone you are representing have questions about the binding nature of arbitration, we recommend seeking additional legal support.

Arbitration can be particularly useful where mediation or conciliation have not led to an agreement or if your client wants a process where a decision is made for them but is confidential and generally cheaper and quicker than going to court.

Lawyers are often involved in arbitration and may represent the participants. Experts may also attend to give evidence for the arbitrator to consider.

How to make a referral for pro bono legal assistance

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