Alternative dispute resolution

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Alternative dispute resolution (ADR), or external dispute resolution (EDR), typically denotes a wide range of dispute resolution processes and techniques that parties can use to settle disputes with the help of a third party.^[1] They are used for disagreeing parties who cannot come to an agreement short of litigation. However, ADR is also increasingly being adopted as a tool to help settle disputes within the court system.^[2][3]

Despite historic resistance to ADR by many popular parties and their advocates, ADR has gained widespread acceptance among both the general public and the legal profession in recent years.^[when?] In 2008, some courts required some parties to resort to ADR of some type like mediation, before permitting the parties' cases to be tried (the European Mediation Directive (2008) expressly contemplates so-called "compulsory" mediation. This means that attendance is compulsory, not that settlement must be reached through mediation).^[4] Additionally, parties to merger and acquisition transactions are increasingly turning to ADR to resolve post-acquisition disputes.^[5]

The rising popularity of ADR can be explained by the increasing caseload of traditional courts, the perception that ADR imposes fewer costs than litigation, a preference for confidentiality, and the desire of some parties to have greater control over the selection of the individual or individuals who will decide their dispute.^[6] Some of the senior judiciary in certain jurisdictions (of which England and Wales is one) are strongly in favour of this use of mediation to settle disputes.^[7] Since the 1990s many American courts have also increasingly advocated for the use of ADR to settle disputes.^[8] However, it is not clear as to whether litigants can properly identify and then use the ADR programmes available to them, thereby potentially limiting their effectiveness.^[9]