A rise in disputes has led to pressure being placed on court systems around the world, Griffith College lecturer Katie Sherry explains why legislators in a number of jurisdictions are turning to alternate dispute resolution methods to help curb the tide of commercial law disputes appearing before the courts.
In the last twenty-five years, advancements in technology and the rise of the digital economy have led to a level of globalisation of businesses that has not been encountered before.
However, with this increase in global commercial trade comes a rise in the number of complex commercial disputes. Moreover, this rise in disputes has led to pressure being placed on court systems around the world, many of which are already struggling to manage caseloads.
Recognising the issues being faced within the court system, legislators in a number of jurisdictions are turning to alternate dispute resolution methods to help curb the tide of commercial law disputes appearing before the courts.
The aim of advanced dispute resolution systems is to establish appealing and successful forums for aggrieved parties while at the same time relieving the overburdened court structure.
Alternate dispute resolution encompasses many different dispute resolution techniques including mediation, arbitration, conciliation, negotiation, neutral evaluation and settlement conferences.
A core method of alternate dispute resolution is mediation, which differs from the traditional litigation-based response to a commercial dispute, due to its voluntary and self-determined nature.
Mediation is a multi-party negotiation conducted with the assistance of a neutral third party, who has no power to impose a settlement on the parties. The neutral third party (the mediator) is there to encourage the parties to find a mutually acceptable solution by helping them, define the issues at the core of the dispute, reduce misunderstandings, establish priorities, express emotions, reach points of agreement and eventually negotiate a settlement.
Moreover, while mediation remains a novel approach in many jurisdictions, it is not a new concept. Indeed one of the first documented mediations occurred more than 4,000 years ago in Mesopotamia when a Sumerian ruler helped prevent a war and establish an agreement to settle a dispute over land.
This system of self-determination and agreement is in sharp contrast to litigation as it allows the parties a measure of control over the process. However, mediation can fail if one or both of the parties refuse to reach a mutually beneficial agreement, resulting in a return or progression to litigation.
Legislators around the world have passed statutes and even a multilateral convention to increase the use of mediation, which is also a cost-saving alternate dispute resolution technique. The aim is not only being to uphold the settlements reached but, in some cases, to enable courts to order disputing parties to participate in the mediation process.
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