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Alternative Dispute Resolution Essay

808 words - 3 pages

Nick and Sally Smith had just bought a house and discovered many defects in the home that was not disclosed by the sellers. They were told that the electricity was upgraded, but found that it was not. They were also told that there was never flooding problems, but found to be untrue after several storms. The couple had reason to believe that the sellers, of their new home, misrepresented information in the disclosure form. The estimate of repairs came to around $9,000. The Smiths sent a demand letter to the sellers, which they denied that they misrepresented any of the information in the disclosure form. The Smith’s sales contract specified that any disagreement between the seller and buyer must be dealt with by mediation. MediationMediation is one method of an alternative dispute resolution (ADR). ADR methods are used for resolving disputes other than litigation. ADR aims to encourage the settlement of a dispute between parties in a flexible, informal atmosphere with the assistance of a neutral party. A mediator will use skills that can bring parties together, buyer and seller, to find common ground to reach a solution (Lewis, 2004). The specific outcome of a mediation process is dependent on the goals desired by each party and the style used in each case. There is not a "one size fits all" in conflict resolution in my mind. Each conflict will have there own identity that requires a specific style of mediation. The outcome of mediation is relative to the style used in the resolution process. According to the sales contract, the buyer and seller went to mediation without success. The mediator gave a suggestion of binding arbitration instead of filing a lawsuit. However, the Smiths had a difficult time distinguishing the difference between the two: arbitration and litigation. To distinguish between the two, in arbitration, the arbitrator decides the outcome based on the facts presented. Litigation is the process of bringing, maintaining, and defending a lawsuit (Cheeseman, 2004, p. 22). ArbitrationIn the past five years, ADR cases have more than doubled for the American Arbitration Association; from 95,143 in 1998 to 230,258 in 2002 (Lewis, 2004). Arbitration has become a popular alternative to litigation and is the most common method of ADR. In arbitration, each party will present his or her dispute, through evidence and testimony, to an unbiased arbitrator who reaches a decision and enters in an award (Cheeseman, 2004, p. 41). Parties enter in the contract requiring the dispute to be submitted into arbitration that eventually becomes binding. Some advantages of arbitration include...

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