Understanding Alternative Dispute Resolution (ADR)

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There are a variety of alternative processes for dispute resolution to the traditional ‘court led’ litigation route. Alternative Dispute Resolution (ADR) is the name for such processes. There is generally a high rate of satisfaction and success with ADR methods as it can be less formal, quicker, more confidential, less stressful and more cost effective than traditional methods.

There are three key methods of ADR. These are Mediation, Conciliation and Arbitration.


Mediation is a process by which a third party, the mediator, who is independent from the dispute, and is normally but not always an experienced barrister or former judicial officer, assists the parties to reach a resolution. Whilst the mediator can aid in the identification of the key issues and develop alternatives, they cannot offer advice, opinions or have a role in the determination of the mediation. That is to say, a mediator does not make a binding decision.

The role of the mediator is to facilitate the mediation process and ensure each party can ventilate their position. Their assistance allows for effective communication of key issues and enable conversation to come up with solutions. The mediator does not pick a side, decide or suggest a solution. Neither will a mediator provide legal advice or decide as to who is right or wrong. The mediator is there to facilitate the discussion, not come to any conclusion, though may assist the parties in identifying the strengths and weaknesses of their respective cases.

Mediation is becoming increasingly popular to resolve civil or commercial disputes as it gives the parties the opportunity to reach their own agreement, and allows them the chance to be actively involved in the process and resolution of their dispute. Indeed, absent good reasons why they should not attend mediation, most courts now require the parties to attend mediation before they proceed to trial as a matter of policy. This gives you the flexibility of agreeing on an outcome which a Court may not necessarily have the power to order, as well as the option of avoiding the potential negative publicity of a public hearing and reported judgment being available to the public at large online.


Conciliation is another process that is similar to mediation, as it involves an independent third party to assist those involved in the dispute to identify the key issues and reach an agreement. The key difference between mediation and conciliation is that conciliators may have professional expertise in the subject matter of the dispute, so they are able to provide advice about the issues and can suggest options for resolution.

Similarly, to a mediator, a conciliator will not take a side, decide who is right or wrong, or tell you to make a certain decision. Their role is to provide suggestions and facilitate the discussion to determine possible options for the resolution of the dispute.

Conciliation is more suitable when you want to reach an agreement on technical legal issues (that might require advice) or need assistance with the process. It is also quite suitable when mediation had been attempted but neither participant had come to an agreement.


Finally, arbitration is another method of ADR in which the parties present their evidence and arguments to an independent arbitrator, who does in fact decided an outcome to conclude the dispute.

Whilst the mediation and conciliation process can be informal, the arbitration process is much more formal as it is similar to a court process, whereby the arbitrator makes a legally binding decision. An important element of the arbitration process is that both parties must agree that the decision is binding. Whilst the arbitration process will end in a binding decision, there are still some limited opportunities for appeal.

Arbitration is most suitable when the dispute matter is highly technical or complicated, or where the parties seek a more confidential process than court would provide. It is also quite useful if both the processes of mediation and conciliation have not eventuated in a result as arbitration requires a decision to be made for you. This process is generally cheaper and quicker than going to court, but it is generally advisable that you engage lawyers in this process.

Benefits of ADR

ADR methods allow parties to work through their dispute with the assistance of a third party. Benefits include:

  • Time: resolution can be achieved much quicker than an official court process could take
  • Money: more cost effective and sometimes reduces the need for lawyers, experts and counsel
  • Control: the parties have the opportunity to “tell their side of the story”
  • Confidentiality: ADR processes are not open to the public or the media unlike court
  • Flexible remedies: solutions can be more flexible as generally no court order is being enforced.

ADR is not suitable for every type of dispute and there are many benefits to a traditional process. However, these processes offer an alternative to traditional methods, and it is important you research what method would suit your situation best or talk to your lawyer who will advise you on the best steps forward.

If you have any questions around alternative dispute resolution processes, please do not hesitate to contact our Litigation and Dispute Resolution team for further advice on 02 6274 0999.

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