1. What is Alternate Dispute Resolution?
1. Alternate Dispute Resolution ("ADR") - a general term used to describe various problem solving techniques that can be used as an alternative to litigation in court. These methods are designed to meet specific needs of the parties and the nature of the dispute.
2. Purpose - avoid time consuming, expensive and stressful litigation.
2. Direct Negotiation. - The parties themselves attempt to reach joint resolution.
1. Role of Parties - negotiate directly or through attorney.
2. Neutral Third Party - none.
3. Role of Attorney - generally none.
4. Where Appropriate - unlimited.
5. Type of Proceeding - private, confidential.
6. Cost - minimal; primarily time.
7. Result - structured by parties (or their attorneys).
8. Advantages.
1. Gives parties maximum control over the outcome.
2. Outcome most likely to meet individual needs of parties.
3. Time, cost, flexibility, privacy.
9. Disadvantages.

1. Depends upon the good faith of the parties and their attorneys.
2. Nonbinding unless reduced to writing and signed.
3. May not appropriate where one party is in a substantially stronger bargaining position or is in a position of power.

1. Mediation. - Neutral third person assists parties in the negotiations and acts as a facilitator.
1. Role of Parties - negotiate directly or through attorney, with assistance of mediator.
2. Neutral Third Party - "Mediator."
3. Role of Attorney - educates and advises client.
4. Where Appropriate - unlimited.
5. Type of Proceeding - private, confidential; structure flexible.
6. Cost - varies; mediation service fee and possibly attorney fees.
7. Result - structured by parties (or their attorneys) assisted by mediator.
8. Advantages - time, cost, flexibility and privacy
9. Disadvantages.
1. Depends upon the good faith of the parties and their attorneys; unrepresented or uninformed party at disadvantage.
2. Poor mediator (qualifications, style, attitude) can result in unsuccessful resolution.
2. Arbitration. - Mutually selected qualified third party to preside over case presentation.
1. Role of Parties - participate in case presentation; testify; less formal than trial.
2. Neutral Third Party - "arbitrator"; must be qualified; renders decision.
3. Role of Attorney - presents case as an advocate.
4. Where Appropriate - where negotiations are at an impasse; privacy desired; parties want decision from expert in the field; factually or legally complex case
5. Type of Proceeding - private; adversarial; structured like trial, with evidence, witnesses, etc.
6. Cost - usually less expensive than litigation.
7. Result - binding decision with limited right of appeal.
8. Advantages.
1. No jury trial (may be disadvantage to plaintiff seeking high general or punitive damage award).
2. Informal.
3. Generally lower cost.
4. Privacy.
5. Fast - depends on parties willingness to move case along.
6. Decision rendered by qualified arbitrator.
7. Binding; limited right of appeal (some might regard this as a disadvantage.
9. Disadvantages.
1. Parties cannot be compelled to arbitrate unless they signed an agreement to arbitrate.
2. No precedent value.
3. Outcomes can vary, depending on arbitrator.
4. Rules of evidence less predictable.

3. Litigation. - Judge (and possibly jury) hears case presentation; decision subject to appeal.
1. Role of parties - actively participate in case.
2. Neutral Third Party - judge and jury.
1. Judge selection is arbitrary.
2. Jury selected by attorneys.
3. Role of Attorney - presents case as advocate.
4. Where appropriate - public forum and jury if desired; precedent important.
5. Type of Proceeding - public; adversarial; case presented with testimony, evidence, and witnesses.
6. Cost - high direct and indirect (time and emotions) cost.
7. Result - binding; right of appeal.
8. Advantages and disadvantages.
1. Precedent value.
2. Result more predictable if law of case is good.
3. Party with the most to gain by the public nature of the case has distinct advantage.
4. Jury system permits weak cases to become stronger.
5. Financially stronger litigant may prevail due to the cost.
6. Right of appeal gives "second and third chance."
7. Outcomes can vary, depending on jury and skills of attorney.

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This educational series is created to allow Realtors to obtain continuing education. The articles are intended for general informational purposes and are not to be construed as legal advice or legal opinion on any specific facts or circumstances. You are advised to consult with an attorney concerning any questions about your rights or responsibilities in any specific situation.