Review of the Alternatives to

Dispute Resolution (ADR) by

International Commercial
Arbitration and Litigation.

COURSE CONVENOR:

DR GBENGA ODUNTAN
http://www.kent.ac.uk/law/people/oduntan.htm
WHAT IS ADR?
 WHAT IS ADR
 SEE FOR INSTANCE PRACTICE DIRECTION PRE-ACTION
CONDUCT
 (3) ‘ADR’ means alternative dispute resolution, and is the collective
description of methods of resolving disputes otherwise than through the
normal trial process; (see paragraph 8.2 for further information);

 See definition of ADR in the Pre-Action Protocol for Judicial Review

 Alternative Dispute Resolution

 9. The courts take the view that litigation should be a last resort. The parties
should consider whether some form of alternative dispute resolution (‘ADR’) or
complaints procedure would be more suitable than litigation, and if so, endeavour
to agree which to adopt. Both the claimant and defendant may be required by the
court to provide evidence that alternative means of resolving their dispute were
considered. Parties are warned that if the protocol is not followed (including this
paragraph) then the court must have regard to such conduct when determining
costs (italics added).
WHAT IS ADR

 the collective term for the ways that parties

can settle civil disputes, with the help of an
independent third party and without the need
for a formal court hearing.
 Note however the view of some writers that
 “ADR is generally taken to cover all forms of dispute
resolution other than litigation and arbitration. The reason for
this is clear: both litigation and arbitration operate regardless
of the will of the parties and result in a binding and
enforceable outcome”
See A. Connerty Alternative Dispute Resolution
Transnational Dispute Management January 2007 267-268
 Imperative Considerations in
Deciding on Appropriate ADR
 Fairness
 Confidentiality
 Cost
 Speed
 Expertise/qualified neutral
 Available Reliefs
 Flexibility
 Maintenance of business & other relationships
 Establishing precedent
 Timing/when to use during dispute
 Power issues
 Empowerment/self-determination
 Noble History of ADR/Track 2 Diplomacy in Int. Relations
See Oduntan, International Law and Boundary Disputes in Africa p. 295-304
Negotiations behind the scenes: Highly
effective.
• On 15 December 2013 Obama ‘accidentally’
shakes the hand of Castro at Mandela’s
Burial
• On April 11, 2015, both leaders again shook
hands at the Summit of the Americas in
Panama, marking the first meeting between
a U.S. and Cuban head of state since the
two countries severed their ties in 1961. The
meeting came four months after the
presidents announced their countries would
restore ties.

On Sept. 28, 1995, a group of world leaders watched as Israeli Prime Minister
Yitzhak Rabin and Palestinian leader Yasser Arafat signed a 400-page
document. “The negotiations were hammered out in complete secrecy in
Oslo, Norway, by Israeli and Palestinian negotiators acting without
intermediaries.
 Alternative Dispute Resolution Mechanism

Probable effects of Litigation & Arbitration

 Polarised positions
 A drain on the clients managerial time.
clients who feel out of touch with their own
dispute and become the victims of a legal
“take-over”.
 Damaged commercial relationships
 Expensive and long drawn-out proceedings
 Use of deliberate delaying tactics by a
defendant who knows how to play the
system
 A pyrrhic victory for the successful litigant
with monies recovered representing a
mere fraction of actual expenditure
 A judgment that is impossible to enforce
 A belated realisation by the plaintiff that the
whole reason for the litigation was the
impecuniosity of the defendant
• The Promise of ADR
• For many reasons , not least
in terms of cost, ADR is
preferable to arbitration and
litigation. ADR however, will
only succeed if the parties are
well disposed towards it.
• At the end of an ADR process
parties may request for a
“consent award” This is as
enforceable as an arbitral
award or a court judgment
ADR Definitional Quandary
 “Internationally, the terms
“conciliation” and “mediation” are
used sometimes to describe
processes that are substantively
the same and sometimes to
describe processes that are similar
but have some differences. Where
there are substantive differences,
there is no uniform understanding
of what those differences are.
Mediation as referred to in the ICC
Mediation Rules and these
Mediation Guidance Notes is a
concept sufficiently broad to
encompass both mediation and
conciliation”.
 P.4
ADR Definitional Quandary
(Cont’d)
 “Throughout this article the terms “conciliation” and “mediation” will
be used interchangeably…The terms “mediation” and “conciliation”
are very often used interchangeably by the majority of scholars and
practitioners”1.
 “[t]he term mediator seems to be more frequently employed in
American usage, while that of conciliator has some currency in
British English, although both expressions are used in England”.2
 “[i]n my opinion this term (conciliation) is interchangeable with the
term mediation”.3
 “[a] plausible explanation is that mediation is an Anglo-Saxon word,
whereas conciliation derives from civil law origins”.4
 1 A.F.M op. cit p. 193, note 4
 2 Michael E. Schneider, “Combining Arbitration with Conciliation” (2003) 1(2) Oil, Gas and Energy Law Intelligence ”, available at
www.gasandoil.com/ogel/articles/article_55.htm. Pieter Sanders, “ADR in Civil law countries” (1995) 61 Arbitration 35:
 . 3See also Martin Hunter, “International Commercial Dispute Resolution: The Challenge of the Twenty-first Century” (2000) 16
Arbitration International 378 at 381, n.10:
 4. See further Henry Brown and Arthur Marriott, op.cit. pp.108 et seq. ; generally, Mackie, Miles and Marsh, Commercial Dispute
Resolution (Butterworths, London, 1995).
Alternative Dispute Resolution Mechanisms:
History
Two leading ADR Rules
 Both the UN Commission on International Trade
Law (UNCITRAL) and the International Chamber
of Commerce (ICC) have drawn up Conciliation
Rules:
 See ICC ADR Rules (2001) now the ICC
Mediation Rules 2014.
 The new ICC Mediation Rules which came into
force on 1 January 2014.
-mediation now the default technique,
E.G.s of ADR
Mediation
 An independent third party
(the mediator) assists the
parties through individual
meetings with them as well
as through joint sessions to
focus on their real interests
and strengths
 Mediator does not make
recommendations as to what
is appropriate settlement and
does not decide the case. He
merely assists parties in
achieving this task (Newman
op.cit., p. 152-153)
Conciliation
• A conciliator ascertains the
facts of a dispute and on the
basis of his findings tries to
bring parties together to
focus on the key issues and
may make recommendation
or give an assessment
• Note that the
recommendations are merely
advisory in public
international law (See G. Oduntan
Law and Practice of the ICJ ( Michigan
Univ press 1999) pp 25-28)
E.G.s of ADR

Mini Trial
 The mini-trial is often used in disputes between
corporations. A ‘hearing’ takes place before a
neutral third party and senior executives of the
business organisations involved. Those executives
will not have been concerned in the disputes itself.
 Each side presents its case. It is open to the third
party neutral to indicate the consequences in
terms of time and money should the minitrial
process fail. This system has enjoyed
considerable success in places like the United
States.
EXPERT DETERMINATION
 A third party expert is appointed by the parties to
consider the particular matter raised by the parties.
The decision of such an expert is normally binding.
 This system is quite commonly used for
construction contracts, information technology
contracts, geophysical sciences etc.
 Major advantages include that it is cost-effective
and quick.
History
 Telecredit Inc. and TRW Inc., had dispute over a complex patent infringement case.
 For history of this case see Eric. Greene Growth of the Mini-Trial Trends vol 9 Litigation (1982-1983).
See also Davis & Omlie, Mini-Trials: The Courtroom in the Boardroom, 21 Willamette L. Rev. 531, 535
(1985).
 Good Offices
• The use of Good Offices in the settlement of international disputes entails
the intercession of a third party (a state, an international organisation or
even a private person) in a dispute between parties who refuse to negotiate
with the aim of bringing such parties into direct negotiations. To Darwin;
"Good Offices are sometimes held to mean the action taken to bring about
or initiate, but without active participation, the discussion of the substance of
the dispute."
• e.g. Norway's intervention in the Oslo Accords relating to the Palestinian-
Israeli Conflict
 ADR CONCILIATION
 For the purpose of the UNCITRAL Model Law on International
Commercial Mediation and International Settlement Agreements
Resulting from Mediation (2018)
 The two processes are matched
 With respect to the 2002 version
““conciliation” means a process, whether referred to by the expression
conciliation, mediation or an expression of similar import, whereby
parties request a third person or persons (“the conciliator”) to assist
them in their attempt to reach an amicable settlement of their dispute
arising out of or relating to a contractual or other legal relationship. The
conciliator does not have the authority to impose upon the parties a
solution to the dispute” (Art 1 (3)).
 4.4. A conciliation is international if: (a) The parties to an agreement to
conciliate have, at the time of the conclusion of that agreement, their
places of business in different States.

 See UNCITRAL Model Law on Int.Comm. Conciliation with Guide

2002http://www.uncitral.org/pdf/english/texts/arbitration/ml-conc/03-90953_Ebook.pdf
Enforceability/bindingness of Conciliation

Note for instance, Article 13 of the 1980 Rules

(3) The parties by signing the settlement agreement put
an end to the dispute and are bound by the agreement.
Article 14 2002 Rules. Enforceability of settlement
agreement.
If the parties conclude an agreement settling a dispute, that
settlement
agreement is binding and enforceable
. . . [the enacting State may insert a
description of the method of enforcing settlement
agreements or refer to
provisions governing such enforcement].
Med-Arb

 In addition to using ADR as a filter mechanism, it is possible to use a

mixture of arbitration and mediation or mediation and arbitration –
indeed, whatever combination of mechanisms the parties choose.
 This would involve in certain cases the mediator reverting into the
role of arbitrator.
 Provision is made in Article 40 of the China International Economic
and Trade Arbitration Commission (CIETAC) Arbitration Rules for an
arbitral tribunal to switch to acting as conciliator.
 In the practice of many Asian countries such as China, Japan,
Korea, Taiwan, Indonesia, Korea, Hong Kong, Singapore, India and
Bangladesh there can be a unique combination of mediation and
arbitration in the same proceedings1
 1 Maniruzzaman, Scott Donahey, “The Asian Concept of Conciliator/Arbitrator: Is it Translatable to the Western
World?” (1995) 10 ICSID Review 120. pp.121-128; Takao Tateishi, “The Role of the Two-tier ‘Med/Arb’ Scheme in
Japanese Dispute Resolution” [2000] Asian Dispute Review 24.
Med-Arb
 Derek Roebuck wrote:
 “All the evidence I have been able to accumulate tends to show
that mediation before, in conjunction with or instead of arbitration,
has been available and widely used, with satisfactory methods of
enforcement, by communities of all kinds in the past”1
 Professor Wälde has attributed to a mediator rather than
an arbitrator “an ethical and professional duty to assist the
weaker party in compensating for glaring weaknesses--e.g.
a weak and inexperienced developing country agency
dealing with a highly competent and experienced
international energy company”.2
 Derek Roebuck, “Cultural Differences and Mediation: An Introduction” [2002] Asian Dispute Review
135 at 136. Thomas W. Wälde, “Mediation/Alternative Dispute Resolution in Oil, Gas and Energy
Transactions: Commercially Superior to Formal Litigation and Arbitration” (2003) 1(2) Oil Gas and
Energy Law Intelligence
Med-Arb
 The Baltic and International Maritime
Council (BIMCO) Dispute Resolution Clause

 (b) Notwithstanding the above, the parties may agree at any time to refer
to mediation any difference and/or dispute arising out of or in connection
with this Contract.

 In the case of a dispute in respect of which arbitration has been
commenced under the above, the following shall apply:-

 (i) Either party may at any time and from time to time elect to refer the
dispute or part of the dispute to mediation by service on the other party of
a written notice (the “Mediation Notice”) calling on the other party to agree
to mediation.
ARBITRATOR/CONCILIATOR

“ … it should not be surprising that

the concept of the
arbitrator/conciliator has been
accepted most completely by western
dispute resolution centres on the
Pacific Rim”[1]

[1] Donahey, op.cit. p.121.
Mediation Skills and Strategies

Mediator must skilfully discover

underlying interests,
concerns, desires fears,
wants and issues
 Mediation
 For the purpose of the ICC Mediation Rules:
 1. mediation is a flexible settlement technique, conducted privately and
confidentially, in which a mediator acts as a neutral facilitator to help the
parties try to arrive at a negotiated settlement of their dispute. The
parties have control over both the decision to settle and the terms of any
settlement agreement.

 3. Since mediation is flexible, the mediation procedure to be used can be

adapted to the needs of the parties, including their cultural and legal
backgrounds, and the specifics of the dispute.

 4. During the mediation, the mediator may hold meetings or conference

calls with all of the parties present and may also hold separate meetings
or calls with each of the parties alone
 See ICC, MEDIATION GUIDANCE NOTES
http://cdn.shopify.com/s/files/1/0249/7423/files/ICC_870-
0_ENG_Mediation_Guidance_Notes.pdf?3074
Mediator’s Strategies
Never Rule Out the power of an apology in any form of
business, commercial, family, or other case. Humans
appreciate “I/we am/are sorry”.
 Aim for the heart of the dispute. Questions such as what
is so important about this figure? or why do you need that
result? or what does this mean for you personally? can
unlock understanding.
 invite participants (and their advisors) into each other
shoes - and ask why then you would or would not accept
the offer. This can lead to a rapid opening of both
interests and the creation of possible solutions.
 Timeouts.
 Mediator’s Strategies
 Mediator must deploy timeouts strategically to keep parties relaxed; to
defuse tension; to prevent breakdowns etc.
 Terminating the Mediation A mediator must know when it is in
everyone’s interest to terminate the mediation. This happens rarely but
may occur as a result of loss of confidence by the parties
 threats,

 violence,

 fraud,

 suspicions of money laundering,

 corruption or other exceptional ethical issue, no prospect of

settlement, nor of any other worthwhile partial agreement or
benefit, there appears to be no appetite to continue.
 Jonathan Dingle and Judith Kelbie, “The essential guide to contemporary mediation”, The Mediation Handbook, 2013 –
2014 http://www.rafinauk.com/mediation_handbook.pdf.
Mediation Strategy for the
Parties.
 Mediation advocacy is a specialist skill set.
 A good mediation advocate will have prepared for the
mediation -no substitute for preparation, planning, and
analysis before the day.
 have a strategy in mind, but will also keep an open mind, as
there may be unexpected developments which require them
to devise and adopt a revised strategy during the mediation.
 Expect surprises.
 Use of Case Law and laws; everything legal is acceptable
note however, that “Mediators are not there to be
persuaded”.
 Negotiations

 On negotiation for instance, Alain Plantey states:

Because of its origins and its mercantile
approach, the art of negotiating applies
good sense and favours compromise
…One of the fundamental tenets of ADR
is that “it is better to persuade than to
compel, to contract than to exact, to buy
than to seize”
See Alain Plantey, International Negotiation In the
Twenty-First Century The University of Texas Austin
Studies in foreign and Transnational Studies 2007 pp.
67-68.
 Negotiations

“Confucius had the right idea

when he urged, some 2,500
years ago, the superiority of
negotiation in a spirit of mutual
respect over confrontation and
resort to law”.
 Roy Goode, “Dispute Resolution in the Twenty-First Century”
(1998) 64 Arbitration 9 at 10
 Negotiation Strategies
 Attempting Compromise
 - There is no peace without compromise and there is no
compromise without negotiation (L. Noel, Conseils a un jeune Francais
Entrant dans la diplomatique Paris, La Jeune Parque 1948).
 Parties must aim at a balance of interests

 Relative weight to be given to both parties is hardly ever the

same and this has a bearing on negotiation
 FOR THE WEAKER PARTY
 -Everything matters and the smallest setback in negotiation may
have grave consequences. His goals are usually clear and often
definite.
 FOR THE STRONGER PARTY
 -Wealth and power produce a tendency to overestimate his
capabilities and underestimate the adversary and his willingness
to fight, resist or attack.
 Negotiations

Top Three Tips

• Prepare sooner rather than later
• Prepare when the other side is
vulnerable.
• Act when the other side has work
to do.
•
•
Negotiation Strategies
COMPETITIVE (Win-Lose)
Attempting to grab as much ground and outcomes as possible.
Maximising advantages and outcomes right now with little care
of concessions
More suitable where:
 One time negotiation with little prospect of future
relationship
 Future relationship not seen as important
 Relationship exists but was quite poor in the first place
 The other party is notoriously dishonest or disrespectful of
the process.
Negotiation Strategies
AVOIDING (lose-lose)
Nicknamed MISNOMER “wrong or inadequate name” Used
infrequently
Does not always mean LOSS
See negotiating as a waste of time or not worth pursuing
Example: buying 2 different houses, both meet all needs but
you may decide not to negotiate with one party because
the price is too high and the person is inflexible. So you
select alternative and avoid negotiating in that instance.
Negotiation Strategies
Accommodating (Lose to Win)
Typically the relationship between the parties is seen as
important and more important than the outcome
Focused on (re)building or shoring up the relationship
Note the importance and value of winning to all humans
their goodwill may be exploited in the future.
Exchange short term loss for long term gain
CAUTION: Constantly giving may induce the other party to
adopt a competitive strategy and attempt “Winner takes
all” or attempt to take advantage of perception that you
have let your guard down.
STRATEGY
Collaborative (Win-win)
 Aim at enlarging the pie by finding things of value to both
parties, thus, creating a win-win situation where both
parties can leave the table feeling that they have gained
something of value
 Some organisations are well known for their collaborative
style to doing business while there are those that have a
reputation for being mercenary in their business
approach.
 Being collaborative does not mean being weak and giving
in. On the contrary, a collaborative approach seeks to
gain the best possible solution.
But is Mediation/ADR
compulsory?
COURTS CAN ORDER MEDIATION?
In Kinstreet Ltd v. Balmargo Corporation Ltd in 1999

Shirayama Shokusan Co Ltd v Danavo Ltd [2003]EWHC 3006 in 2003

In Cowl v Plymouth City Council

Dunnett v Railtrack plc [2002] EWCA Civ 302

COURTS CANNOT ORDER MEDIATION?

Halsey v. Milton Keynes NHS Trust (2004).

Steel v. Joy and Halliday (2004) ECWA Civ 576.

But is Mediation/ADR
compulsory?
In Kinstreet Ltd v. Balmargo Corporation Ltd in 1999 (Unreported
but available at www.adr.civiljusticecouncil,gov.uk )
in the face of party’s opposition to mediation, the court
nevertheless ordered ADR. Arden J. took the view that r.1.1 of
the CPR “the overriding objective”, opened the way for such an
order.
Similarly in
Muman v. Nagasena in 2000, (Court of Appeal [2000] WLR 299) a
dispute over the administration of a charity, a stay had been
ordered for reasons unconnected with mediation. Mummery
L.J. said:

“I would also direct that the stay on the proceedings should not be
lighted until after an attempt has been made by the parties to
resolve this dispute by mediation”
But is Mediation compulsory?
(Cont’d)

In Shirayama Shokusan Co Ltd v Danavo Ltd [2003]EWHC 3006 in 2003

Shirayama was in dispute with their tenant which owned and
operated the Saatchi Gallery. Relationships had been exacerbated by
the issuing of proceedings by Shirayama and by Mr Saatchi making
allegations of dishonesty against people associated with Shirayama.
Shirayama said their rights under the lease were very clear; either
they were right or they were wrong but either way they were not
prepared to mediate because they had nothing they could
compromise. Danovo Ltd asked the court for an order requiring
mediation. Blackburne J. ordered mediation, deriving support from
both Kinstreet and Muman that he had jurisdiction so to do.
 So by 2003, it looked as if the courts were adopting a jurisdiction to
order compulsory mediation.
 But is Mediation compulsory?
(Cont’d)
 In Cowl v Plymouth City Council Frank Cowl v Plymouth City
Council [2001] ADR.L.R. 12/14. the Court of Appeal stated that
‘today sufficient should be known about ADR to make the
failure to adopt it, in particular where public money is involved,
indefensible’.
 In Dunnett v Railtrack plc [2002] EWCA Civ 302 - CEDR
 the Court of Appeal told the parties that they should attempt
ADR; which Railtrack refused to consider. Notwithstanding
that Railtrack won the appeal, they did not recover their costs
from Ms Dunnett. The court stated that if lawyers
 ‘turn down out of hand the chance of ADR when suggested by
the court, as happened on this occasion, they may have to
face uncomfortable costs consequences’.
But is Mediation compulsory?
(Cont’d)
 However, by 2004 that position was
altered when the Court of Appeal
decided in two cases that were heard
together that courts cannot order
mediation:
 Halsey v. Milton Keynes NHS Trust
 Steel v. Joy and Halliday 2004 ECWA
Civ 576
But is Mediation/ADR
compulsory?
 See for instance, the Pre-Action Protocol for Disease
and Illness Claims - Civil Procedure…
 19 Jul 2013.
 2A.1: The Courts take the view that litigation should be a
last resort, and that claims should not be issued
prematurely when a settlement is still actively being
explored.
 2A.4: It is expressly recognised that no party can or
should be forced to mediate or enter into any form of
ADR, but the parties should continue to consider the
possibility of reaching a settlement at all times.