Historically, methods used to settle disputes have ranged from negotiation, to courtroom litigation, and even to physical combat. The legal needs of countries, multinational companies, and ordinary people have changed over the last decade. When faced with a dispute, business people are learning that, whenever possible, it is more advantageous to reach practical and private agreements than to fight for years and spend huge amounts of money in courtroom battles. Due to the vast amounts of time and money involved in the trial process, the business communities have increasingly turned to legal alternatives that are more prompt, private and economical than the courtroom. Alternative Dispute Resolution (ADR) refers to the wide spectrum of legal avenues that use means other than trial to settle disputes.
The main ADR alternatives to civil litigation are arbitration,mediationand conciliation.
Arbitration is an ADR method where the disputing parties involved present their disagreement to one arbitrator or a panel of private, independent and qualified third party “arbitrators.” The arbitrator(s) determine the outcome of the case.
Parties in conflict may chose neutral arbitrators to decide and settle a dispute between them. When a disputed matter is to be given to a panel of arbitrators, each party selects their own arbitrator, and together, both arbitrators appoint a third one as the president of the panel. If they able to agree on a common choice, the parties may instead appoint and utilize one sole arbitrator to assist with the dispute. Typically, to use arbitration, there must be an “arbitration clause” already written into contract that exists between the two parties. The procedures that the arbitrator or the panel must follow during arbitration are inserted along with these contractual arbitration clauses. Without this contractual arbitration clause, parties may agree once a dispute surfaces, to allow arbitrators to hear and resolve their disputes.
Mediation is an ADR method where a neutral and impartial third party, the mediator, facilitates dialogue in a structured multi-stage process to help parties reach a conclusive and mutually satisfactory agreement. A mediator assists the parties in identifying and articulating their own interests, priorities, needs and wishes to each other. Mediation is a “peaceful” dispute resolution tool that is complementary to the existing court system and the practice of arbitration.
Arbitration and mediation both promote the same ideals, such as access to justice, a prompt hearing, fair outcomes and reduced congestion in the courts. Mediation, however, is a voluntary and non-binding process – it is a creative alternative to the court system. Mediation often is successful because it offers parties the rare opportunity to directly express their own interests and anxieties relevant to the dispute. In addition, mediation provides parties with the opportunity to develop a mutually satisfying outcome by creating solutions that are uniquely tailored to meet the needs of the particular parties. A mediator is a neutral and impartial person; mediators do not decide or judge, but instead becomes an active driver during the negotiation between the parties.
Conciliation is another dispute resolution process that involves building a positive relationship between the parties of dispute, however, it is fundamentally different than mediation and arbitration in several respects. Conciliation is typically employed in labour and consumer disputes The “conciliator” is an impartial person that assists the parties by driving their negotiations and directing them towards a satisfactory agreement. It is unlike arbitration in that conciliation is a much less adversarial proceeding; it seeks to identify a right that has been violated and searches to find the optimal solution.
Conciliation tries to individualize the optimal solution and direct parties towards a satisfactory common agreement. In conciliation, the conciliator plays a relatively direct role in the actual resolution of a dispute and even advises the parties on certain solutions by making proposals for settlement. In conciliation, the neutral is usually seen as an authority figure who is responsible for the figuring out the best solution for the parties. The conciliator, not the parties, often develops and proposes the terms of settlement.
Entire spectrum of ADR, including:
- Early case assessment and definition of arbitration strategies
- Pre-dispute negotiations
- Selection of arbitrators
- Filing and conduct of international arbitration proceedings
- Advocacy at arbitration hearings
- Challenge and enforcement of arbitral awards
- Drafting, negotiating and/or reviewing arbitration clauses or other dispute resolution clauses in a variety of contracts and situations
Managing Partner, S.U. Khan Associates representing Federation of Pakistan Chambers of Commerce and Industry attended the First Task Force Meeting (April 2018) in Istanbul, Turkey held in connection with the establishment of Organization of the Islamic Cooperation (OIC) Arbitration Center at Istanbul, Turkey. This OIC Arbitration Center was proposed by the President of the Turkey in his capacity as Term President of the OIC/Chairman of the Standing Committee for Economic and Commercial Cooperation of the Organization of the Islamic Cooperation (COMEC). The Meeting discussed about the prevailing arbitration legislation and practices in member countries of OIC and about how to promote the use of this proposed arbitration center among the member countries.