As the alternative dispute resolution—or ADR—world grows and becomes more prevalent, many business lawyers, and even some litigators, may find the difference amongst the various ADR processes somewhat unclear. Selectors may also confuse the role a neutral plays in each and waver in determining the best person to choose for their case. I describe below the traditional ADR mechanisms, namely arbitration and mediation, and the attributes of an effective arbitrator and mediator. I then cover Med-Arb, a lesser-known mechanism, and discuss dispute avoidance measures, which are gradually gaining traction.

Arbitration

Arbitration is often viewed as a more efficient and less costly alternative to litigation. It is a dispute resolution process that is generally supported and enforced by the traditional courts. Basically, it involves the parties selecting their adjudicator and agreeing to the procedural rules they will follow. The concept of party autonomy is at the heart of the arbitration process. For disputes involving highly technical matters, selecting the decision maker based on their qualification as opposed to a court-imposed judge can be particularly appealing. For smaller disputes and parties seeking a swift process, the ability to bypass extensive discovery and cumbersome processes is another major advantage. For international transactions, arbitration allows parties to avoid having to submit to the courts of a foreign nation that may have national biases. More generally, arbitration centers and arbitrators have shown themselves to be much more easily adaptable to change than courts: The shift to remote in arbitration hearings was rather swift while courts have moved relatively slowly, if at all, creating a significant backlog.

That being said, arbitration can have its drawbacks. Although it's often viewed as a confidential process, it may not always be. For example, if enforcement of an arbitration award is contested in court, the judge's ruling in and of itself may disclose portions of the arbitration proceedings. Also, unless the parties have separately agreed to confidentiality, they are not prevented from making disclosures. Another concern with arbitration is that arbitrators are generally viewed as reluctant to make the tough decisions and more likely to find a "middle of the ground" solution that appeases both parties. Unlike judges, arbitrators are generally selected by the parties and paid by them for their services; they could therefore be less inclined to alienate a party for fear a gossiping party may damage the arbitrator's reputation and future appointments. Further, an arbitration award is generally not appealable: Although a party may contest enforcement of an award under narrow procedural grounds, generally, an arbitration award is final. Finally, the biggest benefit of arbitration, namely a swift and economical process, is not always assured. It requires that both parties agree to it. Although arbitrators generally try to encourage the parties to act expeditiously and avoid unnecessary discovery and lengthy processes, ultimately their hands will be tied by the terms the parties agree, or don't agree. Since often one party has an interest in drawing proceedings out, the arbitrator's ability to streamline the process may be limited absent an arbitration agreement that imposes specific limitations on the parties. It's also worth noting that the general finality of arbitral awards can, in and of itself, extend the process: Arbitrators may be overly cautious to ensure not only that the right result is achieved but also that the procedure followed does not transgress any of the limited grounds for vacatur.