Differences between alternative dispute resolution and litigation
Learn about the key features and considerations for alternative dispute resolution and litigation. These will help you decide which avenue is best suited to manage your conflict.
It is important to compare and contrast how each option relates to your current situation. This will help you determine how to best meet your objectives and to obtain satisfaction with the process chosen.
Alternative dispute resolution
Alternative dispute resolution is any means used to resolve a conflict other than through litigation. Examples include negotiation, facilitated discussion and mediation.
- Allows for a custom-made win-win outcome on all or part of the issues
- Focuses on consensus-building and is future-oriented
- Aims to determine the parties' interests
- Involves the participation of a neutral and impartial alternative dispute resolution practitioner, selected or agreed upon by all parties, to facilitate participants' negotiations and discussions
- Voluntary participation, except where court-appointed, and participants can withdraw from process at any stage
- Usually informal, less structured and flexible
- Emphasizes mutuality over self-interest and reconciliation over termination
- Parties actively participate in the process, define the issues and retain control of the outcome; they have the final say, not the alternative dispute resolution practitioner
- Discussions, negotiations and documentation are confidential, unless otherwise required by law, and do not form part of the public record
- Allows for direct communication between participants in a non-confrontational setting to identify the true issues and cause of the dispute
- Each party has the opportunity to describe the situation from his or her perspective, needs and interests without the restrictions of the civil rules
- Requires commitment; outcome also requires good-faith participation by all participants; time and money will be wasted if the intention to collaborate is not present
- Alternative dispute resolution process can be scheduled at the convenience of participants and practitioner
- Allows for creative discussion of options and a wider range of possible outcomes, such as better understanding of others' perspective and change in practice or process
- Outcome depends on settlement authority of the participants
- Allows for the preservation of business relationships
- Parties reserve the right to litigate, if they are unhappy with the process or do not reach agreement, they can walk away or proceed to litigation
- If a mutually acceptable resolution is reached, the agreement can result in a legally binding settlement agreement
Litigation is the act or process of bringing about or contesting a claim (that is, using the traditional court system).
- May result in an “all-or-nothing” decision
- Focuses on the facts and is past-oriented
- Aims to determine the parties' legal rights
- Determines winners and losers
- Usually involves a judge who is appointed by the court to determine the outcome based on the law and legal precedents
- Mandatory participation once legal action is initiated
- Formalized and highly structured
- Costly and long delays
- Communication usually occurs through lawyers
- Results cannot be predicted; responsibility for decision rests with a court-appointed third party
- Decisions rendered can act as precedent in future similar cases
- Provides public record of evidence and a decision supported by reasons that may be subject to appeal
- Usually requires more resources (more costly, more witnesses, experts and preparation time) and a longer wait time for resolution
- When quick action is necessary, the courts can provide emergency rulings, such as injunctions, which are not always possible in alternative dispute resolution processes
- Ensures a decision; even in cases where the dispute involves a non-negotiable issue
- Focuses on determining what is legal and what is not
- Provides authority on issues that involve a breach of law or statute interpretation
- Ideal for cases that have implications for a wide range of individuals outside of the immediate localized dispute or where parties want to have a third party be responsible for the decision
Deciding how to proceed
When reviewing your options, it is important to consider the following:
- What degree of control, as a participant, would you like to have?
- Who has the decision making authority for this dispute?
- What degree of decision making authority would you like the third party to have?
- What are the power dynamics at play within this dispute?
- What are the structural features of this dispute (such as time-constraints or resource allocation)?
- What is the intended goal in striving to resolve this dispute?
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