ALTERNATIVE DISPUTE RESOLUTION (ADR) can be defined as the resolution of disputes other than rendered by the judicial system. Within these parameters, one can find a number of ADR methods, from negotiation all the way through binding arbitration. Moreover, ADR may be used for a wide variety of problems, from multimillion-dollar business disputes between major companies in different states to grievances between employers and employees within the small local community.

The benefits and utility of ADR is evidenced by the fact that so few of all the disputes that arise in the commercial world ever find their way into a courtroom. Until quite recently, legal training tended to emphasize litigation tools and techniques while no embracing other ADR procedures.

ADR does not necessarily eliminate the need for the skills of an experienced litigation specialist, since the parties are usually free to incorporate a number of traditional trial preparation tools (e.g., discovery) into their ADR procedures. What ADR does require is that lawyers understand the advantages and disadvantages of ADR in particular commercial contexts, and the issues that must be considered when drafting an ADR provision for a contract entered into long before all potential problems have been identified.

Given that ADR is based on the premise that the parties should have the flexibility to devise their own method to solve their problems, it is not surprising that there is really no set definition of the available types of ADR methods. The following types are commonly used procedures:

• Negotiation;
  
  
• Mediation;
  
  
• Contractual (binding) arbitration

Advantages of Alternative Dispute Resolution

Speedy Resolution
Reduced Expense
Increased Predictability
Flexible Solutions
Less Burdensome for Client
Privacy
Avoidance of Judicial Precedent
Preservation of Business Relationships