Alternative Dispute Resolution (ADR)

Alternative dispute resolution (ADR) can best be defined as a manner for the resolution of a dispute outside of the court systems, meaning that the parties opt for a private dispute resolution procedure. The four most common ADR procedures in South Africa are considered to be, negotiation, conciliation, mediation and arbitration.

The process of negotiation is normally conducted between the parties themselves, whilst on the other hand the processes of conciliation, mediation and arbitration are regulated with the assistance of a commissioner, trained meditator or arbitrator. The process of conciliation and mediation are very similar in nature, and is seen as a non-binding, voluntary process where a third neutral party (the mediator or conciliator) assists the parties in order to settle a dispute without the dispute being adjudicated through Court.

Mediation is mainly focused on assisting the parties to try and find their own solutions, by placing emphasis on the parties’ own interests, rather than by focusing on the legal problem at hand. The mediator plays a pivotal role in this process, with one of his most important duties being to ensure the facilitation of discussions between the respective parties. This to compound with assisting them in identifying issues that may be in dispute between them. The mediator cannot however make any decision that is binding on the parties, nor can he force the parties to agree on a certain point. The mediator is intended to find practical solutions to prevailing disputes.

Arbitration on the other hand, is seen as a procedure in terms of which a dispute is referred to an arbitrator by agreement between the parties. The Arbitrator is ultimately tasked with the responsibility to take into consideration both parties’ arguments, and grant an award (decision on the dispute) to which the parties can refer as prevailing decision. The parties are in the favoured position to select their arbitrator to adjudicate over their dispute. In the event of the parties not being able to reach an agreement as to which arbitrator to appoint, the parties can approach organisations such as the Arbitration Foundation of Southern Africa (AFSA) or the Association of Arbitrators South Africa (AASA) for recommendations to appoint qualified and suitable persons. The arbitrator focuses on the relevant law applicable to the dispute and the evidence presented by the parties in order to make a final binding decision. The arbitration award can be made an Order of Court, and this is done by approaching the High Court by way of Application in terms of section 31(1) of the Arbitration Act, Act 42 of 1965, in order to ensure that there is full compliance with the award made during the arbitration proceedings.

The big difference between the process of arbitration and mediation is the fact that in arbitration proceedings, the parties have no control over the outcome of the finding made by the arbitrator, as opposed to the mediation process where the final decision to settle the dispute or not, remains solely with the parties.

Although the process of ADR holds many benefits, such as assisting the parties in avoiding the costs involved in extended litigation, providing a process that can be conducted conveniently and expeditiously, there are still some disadvantages involved in the ADR process. For instance when it comes to mediation and conciliation two of the big disadvantages that can be seen is the fact that there are the parties may be dissatisfied with the outcome as a compromise (and potential lessening of some of their claims) is normally expected from the parties to reach consensus. Another big factor to take into consideration is the fact that mediation may not be the best route to take in the circumstances where the parties are completely incapable of jointly discussing disputes and coming to practical solutions.

ADR with all of its advantages and disadvantages still plays a crucial role in our legal system. The Courts have declared that parties intending to litigate should through the initiation of their cases also consider ADR prior to furthering their litigation. Rules such as Rule 41A have become a mandatory facet to force parties to first attempt mediation (or other ADR methods) prior to continuing litigation.