Alternative Dispute Resolution (ADR) is an alternative to litigation that can occur whenever a dispute arises between two parties.  Many times parties will enter into the ADR process to avoid the high cost of litigation and obtain a speedier result.  Other times, parties are contractually obligated to settle any dispute they may have through the ADR process.   ADR may be entered into at any time: before litigation, during a litigation or even after a litigation.  There are two common forms of ADR: mediation and arbitration.

 

Mediation can be voluntarily entered into by two parties in a dispute.  In mediation, the parties will agree to a third party, neutral mediator.  This mediator may be a practitioner in the field, a judge, or an individual active in an ADR institution.  Typically, both parties will submit to the mediator a statement that may be confidential or seen by the other party.  The mediator will then organize a date to meet with both parties, either together or separately and attempt to resolve the dispute.  Having this third, neutral party involved may bring forth a resolution.  Mediation may be done during a litigation as some courts require mandatory mediation, or it may be done in the beginning of a dispute in order to avoid litigation.  Mediation is not binding, and is simply a facilitated settlement negotiation.  The mediator is simply there to facilitate a resolution.  The parties must enter into a settlement agreement in order to resolve the disagreement.  The mediator does not decide the case, nor will they give an opinion.   

 

The Delaware Chancery Court runs a voluntary mediation program for technology cases with damages that would exceed $1million.  The mediator is a chancellor of the court. 

 

 

Like mediation, arbitration is another form of ADR, but unlike mediation arbitration may be binding or un-binding.  Not every dispute may be arbitrated.  In arbitration, each party will present its case to the arbitrator(s) like they would to a judge.  The arbitrator(s) will then decide the case.  Depending on the type of arbitration, the parties may be bound to this decision and the possibility of an appeal may be extremely limited.  Parties will enter into arbitration because of a contractually obligation or because arbitration may be faster and less expensive than a litigation.