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ASKED QUESTIONS What makes up this basket of procedures? The procedures are sufficiently broad in concept that they may be structured, as the parties to the dispute wish, to range from unassisted negotiation at one end of the spectrum, to binding arbitration at the other. The most common non-adjudicative processes are negotiation and mediation, although there are others such as the executive mini trial, judicial mini trial and early neutral evaluation. Why include negotiation in ADR? Don’t people negotiate in most cases? Yes, parties and their lawyers do negotiate in most cases. Indeed, some 90% to 95% of cases settle before trial using some form of negotiation. ADR claims negotiation as one of its procedures because increasingly agreements are structured to require parties to negotiate as a precondition to going to litigation. In those agreements, it is only after a good-faith attempt to negotiate a settlement has failed, that litigation may proceed. Where negotiation is used at the outset of a dispute, it is frequently successful, and most frequently involves less cost than litigation. What is mediation? Mediation is a process in which the parties agree to appoint a third-party neutral to assist them in attempting to reach a voluntary settlement. The neutral does not make a decision and the parties may terminate the process at any time. It is confidential and without prejudice. The parties are encouraged to seek independent legal advice, and where a voluntary settlement is achieved, it only becomes binding when the parties have concluded a settlement agreement. What is an executive mini trial? An executive mini trial is not really a trial at all. It is rather a process which involves negotiation structured to involve senior executives who have no involvement with issues giving rise to the disagreement. Senior executives from each side listen to a summary of key elements of the dispute presented by each of the parties. These presentations may be made to the executives on their own, or by agreement of the parties, a third-party neutral may be present. The intent is that the parties use the presentations to try to conclude an agreement by focusing on the business issues. An involved neutral would endeavour to assist the process. What is a judicial mini trial? A judicial mini trial is a non binding, flexible ADR process, involving counsel for all of the parties to the litigation, who present arguments to the judge, in the presence of the clients. Neither the judge nor the counsel are gowned during the presentation. An agreed Statement of Facts should be prepared, if possible, together with copies of expert reports, medical reports and authorities attached. No evidence is adduced, rather, arguments are presented based on agreed facts or facts essentially agreed upon. Counsel may refer to evidence from Examinations for Discovery. Counsel, by arrangement with the Trial Co-ordinator, make an appointment with the mini trial judge assigned to the timeframe for which the appointment is arranged, and the judge is then able to assess whether or not a mini trial is appropriate, and confirm the date for the mini trial, and the time to deliver briefs. Usually the mini trial takes no more than one or two days. The non binding opinion of the judge rendered at the conclusion of the mini trial is strictly confidential. The mini trial judge will not discuss the opinion given at the mini trial with anyone else on the bench. No costs are assessed at the mini trial. If the parties are unable to conclude a settlement, the case will proceed to trial in the normal manner. What is early neutral evaluation? Early neutral evaluation (ENE) is a process in which a person experienced in the subject matter of a litigated dispute, will convene a brief, non-binding meeting to hear the parties outline the key elements of their cases. The evaluator will identify the main issues and explore possibilities of settlement. In addition, the evaluator will assess the merits of each party’s case. If settlement is not achievable, the evaluator may assist the parties by indicating procedural recommendations, the intent of which is to streamline the litigation process. Why use mediation? Savings in cost and time are the dominant reasons, but there are other significant reasons, such as:
What is the most frequently used form of ADR Mediation is the most frequently used form of ADR, though it may be used in conjunction with other forms of ADR. Is ADR suitable in all cases? No. For ADR to be successful, the parties must genuinely wish to achieve a settlement. There are cases in which this will not be the desire of one or more of the parties. Examples are: cases where the parties wish to establish a precedent; where a point of law exists upon which the parties wish to have a formal judicial ruling; where a court order is required to enforce a judgement; where evidentiary processes are required to protect the rights of a party; or where extraordinary court relief is sought, such as a declaratory judgement. Even though a case may not in the first instance appear to be suitable for ADR, the case should be reviewed on a periodic basis to assess whether or not it might subsequently be submitted to ADR. What is the difference between mediation and arbitration? Arbitration involves adjudication by a third-party neutral. While it is possible to structure arbitration to be non-binding, most arbitrations are designed to be binding. Arbitration will in most instances arise by agreement of the parties, either arising out of a pre-existing agreement or based on the specific terms of an arbitration agreement entered into after the dispute has arisen. Unless otherwise agreed, the terms of the applicable Arbitration Act will govern. The single most important distinction therefore is that the decision of the arbitrator, unless otherwise agreed, will be binding, and the decision may be entered on the court record. What is the difference between a mediator and an arbitrator? The mediator does not make a decision, but rather works with the parties to assist them to find a solution, satisfactory to them, of the dispute between them. An arbitrator, also a third-party neutral, makes a decision based on the arbitration agreement and the evidence presented in the arbitration proceedings, and the decision, unless otherwise agreed, is binding on the parties. Isn’t arbitration as expensive as litigation? In some circumstances arbitration can be as expensive and time consuming as litigation. It need not be. The parties and their counsel have the means to avoid those consequences. If they specifically address issues such as production of documents and the conduct of discoveries, and deal with them by agreement, arbitration can be conducted in an expeditious and cost-saving manner. Doesn’t ADR suggest weakness? Unquestionably, many lawyers are reluctant to consider negotiation, or any other ADR process, because they fear that to do so suggests a weakness in their case. To overcome that appearance, many corporations and law firms are adopting policies regarding the use of ADR in suitable cases, and becoming signatories of protocols such as the dispute resolution protocol of The Canadian Foundation for Dispute Resolution, or pledges such as the corporate policy statement of the CPR Institute for Dispute Resolution, the effect of which is to actively and voluntarily consider the use of ADR in all suitable cases. The hurdle to resolution may be one of perception. The reality is that ADR (except for binding arbitration) is a non-binding process — one from which a party may walk at any time. Parties remain in control of the process, and the outcome. When is the best time to suggest ADR? Resolution of a dispute requires careful preparation whether the process used is ADR or litigation. Careful analysis of the dispute involves fact and document gathering and involvement of those who are able to provide evidence. Analysis of the facts and the law are necessary to permit an assessment of risk and of the value of a claim or level of exposure to a claim. Contemporaneous with these assessments, consideration should be given to the use of ADR. If for any reason, ADR is not initially thought to be appropriate, it should nevertheless be considered as circumstances develop and as procedural milestones in litigation are passed — such as at the close of pleadings; production of documents; completion of discoveries; setting down for trial; and at the time of witness preparation for trial. The success rates from using ADR are such that the presumption ought to be that ADR should be used, and justification be sought as to why it is not being used. Does the use of ADR mean less money for lawyers? Clearly a genuine fear exists on the part of lawyers that the use of ADR is a threat to their litigation practices. The desire of the clients to reduce costs will reduce their expenditures on litigation in any event. Lawyers are demonstrating a recognition of this reality by undertaking training in ADR and establishing ADR sections within their firms. The reality also is that disputes will continue to exist and those law firms that are responsive to the needs of clients and which contribute to the early resolution of disputes and cost savings, are most likely to be engaged in the handling of more of the work flowing from satisfied clients. Confirmation of this analysis is obtained in the CPR "1995 Law Firm Practices in ADR" survey of 124 law firms. The response rate was 51%, and it revealed an extensive array of ADR activity. The findings of the survey indicate that among firms that had formally organized their ADR activity, 37% reported gaining new clients or gaining new business from existing clients as a result of ADR expertise. Only 2% of those firms who did not report formal organization of ADR efforts reported such gains. What is ADR Systems Design? As Alternative Dispute Resolution increases in prominence in Canada, many organizations are realizing that there are processes other than litigation that they can use to resolve disputes. They are also finding that traditional methods of resolving internal conflicts are not necessarily the most effective or satisfactory. As a result, a field known as "ADR Systems Design" has emerged. ADR Systems Design is designing conflict management systems for organizations so that when disputes arise, they can be resolved through the most appropriate dispute resolution processes. ADR Systems Design consultants work with managers, in-house lawyers, human resource personnel and others in organizations to determine, before conflicts arise, which processes should be made available to employees, customers and those with whom the organizations are in dispute, as conflict occurs. |
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