ADR is Good For Business

Published by Chris Whitelaw at May 24, 2013

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In the January 8th 2009 edition of BRW Georgina Dent wrote an article called â€œFlight Pathsâ€ in the Law Section of that magazine. The heading was â€œRather than rushing to court, smart companies find ways to settle disputes that leave commercial relationships intact.â€

The main points made in the article –

Businesses can find themselves entrapped in the cost, delay and bother of a courtroom battle;
Litigation work is growing as the number of disputes rises;
Parties to the dispute need to be able to properly assess all of their options for dispute resolution;
Businesses in dispute with each other need to carefully consider whether or not they stand to benefit more by resolving the dispute amicably out of court so that they can consummate further lucrative deals to their mutual benefit;
Litigation is often not the best option to resolve the dispute;
Litigation should be seen as the option of last resort, when all else fails;
ADR options often do not take up as much time, usually are less expensive and keep the door open to an ongoing commercial relationship between the parties;
With ADR everything remains confidential;
In ADR the parties can choose the expert they want to help them resolve the dispute;
Litigation often delivers a poor result overall even to the winning party.

Those of us who practice in ADR have heard this said many times before. But how effectively are we managing to communicate this to our target audience â€“ i.e. to other legal practitioners who are the first ones to take instructions in a new dispute and therefore have maximum capacity to influence the dispute resolution pathway selected by the client; to the public at large; to the business community?

Why is it that when the known and repeated statistic is that 95% of those matters that are channelled into the litigation track eventually settle prior to a final hearing we still see the majority of those disputes follow the conventional litigation pathway rather than be channelled early on into ADR processes that could feasibly save the warring parties lots of money and wasted time tied up in a court case management requirements and timetables and attending to the frequent demands of their lawyers to ensure that they can comply with those timetables?

Why is it that many commercial clients are not embracing ADR early on in a commercial dispute to try and nip it in the bud so that they can get back to business as usual and possibly even do so with a salvaged and possibly renewed and better relationship with the other party to the dispute?

Are we failing as a profession to properly communicate the potential benefits of ADR to our clients? Are many of us still just giving it lip service as something we know we are legally bound to do before we nudge our clients into the more familiar (and more lucrative?) litigation track?

Do many litigation lawyers and their clients have a jaundiced view of court-annexed ADR as being ineffective and simply adding to the overall cost and length of the dispute?

Please share your views based on your own experience and observations. This Blog is open to anyone who has been involved in (or is currently involved in) a dispute and the management of its resolution. This Blog is not just for lawyers or ADR practitioners. The purpose of this Blog is to engage people (anyone) with something useful or constructive to say about the operation of our civil justice system and how to improve it so that it better meets the needs and demands of people caught up in a dispute.

Lets get a national discussion going right here, out in the open, every day, every month and every year so that ALL THE ISSUES are identified and ALL THE VIEWPOINTS are expressed.