How To Avoid Litigation Using ADR Clauses To Control Your Risks And Costs
Few people, other than trial lawyers, enjoy the prospect of going to court, because of the enormous costs, lengthy delays in having a dispute resolved, uncetainty of outcome, and lack of control disputants have over the process. Many people are unaware that by inserting an alternative dispute resolution (ADR) clause in their contracts, they can avoid ending up in court if a dispute later arises. ADR clauses provide alternatives to the court system for resolving a dispute. The most common ADR clauses provide for mediation and/or arbitration.
Below you will find some examples of ADR clauses that use mediation, arbitration or a combination of the two as the final step for resolving a dispute.
Mediation then Arbitration Clause
Arbitration clauses may specify the arbitration rules that the parties want to use. Henning has arbitration rules, but will use any other arbitration rules that the parties may specify. Parties may also include many other details in their agreement to arbitrate, including the number of arbitrators, location of the arbitration, how soon the arbitration hearing must be commenced and other matters.
Selecting An ADR Provider To Conduct The Mediation Or Arbitration Process
Those people who are aware of the benefits of ADR clauses sometimes make the mistake of routinely inserting a clause naming a particular association to administer the ADR process without awareness that this association charges much higher fees than Henning. It often comes as an unwelcome surprise to learn that a substantial filing fee based on the amount of the claim will be charged by the association to use the arbitration process specified in the contract.
Before naming an organization in your contract to administer your ADR process, compare costs, service & quality.
- Henning charges no filing or hearing room fees to conduct your mediation or arbitration.
- At Henning there is no bureaucracy to wade through, and no lengthy delays in getting your process scheduled.
- Henning's panel of neultrals are recognized as the best in the field.
- Your mediation or arbitration will be conducted in a comfortable, confidential, and professional setting.
Note: Henning does not provide legal services, and when drafting contract clauses, an attorney's assistance is recommended. Pat Siuta, President of the Training and Consulting division, is available to consult with attorneys and business people who are considering adopting an ADR clause.