ADR disputes and dispute resolution: pros, pitfalls & cross-border considerations

ADR, or Alternative Dispute Resolution, refers to a variety of methods used to resolve legal disputes without going to court. Common forms include:

• Mediation: A neutral third party helps both sides negotiate an agreement.
• Arbitration: A binding decision is made by an arbitrator after a hearing.
• Conciliation: A conciliator actively proposes solutions to help resolve the dispute.
• Negotiation: Informal discussions between parties, often guided by attorneys.

ADR is widely used in commercial, employment, family, and cross-border legal disputes. It offers flexibility, privacy, and efficiency—especially compared to traditional litigation.

• Speed: ADR processes often take weeks or months, compared to years for litigation.
• Confidentiality: ADR is conducted in private, unlike public court proceedings.
• Cost: Fewer court fees and shorter timelines translate to significant savings.
• Control: Parties can choose mediators/arbitrators and tailor the process.
• Flexibility: ADR allows for creative solutions that courts can’t offer (e.g., performance-based outcomes).
• Preservation of Relationships: Particularly important in joint ventures, business partnerships, and family law.

Example: In a cross-border commercial dispute involving a UK company and a French supplier, ADR allows both sides to maintain business ties while settling a disagreement over delayed shipments.

• Commercial contracts: Breach, interpretation, or performance disputes.
• Construction projects: Delays, defects, or subcontractor conflicts.
• Employment matters: Wrongful dismissal, discrimination, wage issues.
• Family law: Custody, visitation, divorce settlements (especially where children are involved).
• International transactions: Cross-border contracts, import/export, joint ventures.
• Intellectual property: Licensing agreements, royalty disputes.

Notable: Courts in France now require ADR attempts for some family and civil cases under €5,000.

In France, yes—for specific disputes. As of recent civil procedure reforms:

• ADR is mandatory for small claims (under €5,000).
• Required in certain family law disputes, unless urgent or involving abuse.
• Failure to attempt ADR may result in the court declining jurisdiction.

In Common Law systems, courts may not mandate ADR, but they:

• Strongly encourage it (UK, Canada, Australia).
• May penalise parties on costs if they refuse ADR unreasonably (UK Civil Procedure Rules).
• Offer pre-trial settlement conferences or court-annexed mediation.

Mediation:

• Agreements are binding only if formally signed and legalized.
• In France, a judge can grant “homologation” (approval) making it enforceable.

Arbitration:

• The award is binding and can be enforced in over 170 countries under the New York Convention (1958).
• French and UK courts enforce awards unless there’s a procedural defect or public policy breach.

Conciliation:

• In France, certain public conciliators (e.g., labour courts) can issue formal agreements enforceable like judgments.

• Pre-mediation: Parties agree on mediator, location, language, and scope.
• Session: Mediator facilitates dialogue, identifies common ground, and assists in drafting solutions.
• Outcome: If successful, a settlement agreement is signed.

In France, a judge can refer parties to mediation before or during litigation under Article 127 of the Civil Procedure Code. The process is typically conducted within 3 months, extendable once.

To learn more about mediation, you can read the following article:

1. Notice of arbitration
2. Appointment of arbitrator(s)
3. Preliminary hearings and submissions
4. Hearing with evidence and witnesses
5. Final award

Arbitration can be binding or non-binding, depending on the contract. In France, arbitration is governed by Articles 1442–1527 of the Code of Civil Procedure and is generally binding unless the parties agree otherwise.

Tip: Choose a reputable institution (ICC, LCIA, SIAC) to provide procedural rules and appoint arbitrators.

• Conciliator proposes solutions, while a mediator facilitates dialogue.
• Conciliation is often court-linked (e.g., France’s “conciliateur de justice”).
• May be mandatory in certain French disputes (e.g., landlord-tenant or small civil claims).

In France, court conciliators are free and certified by the Ministry of Justice. They handle over 100,000 cases annually.

Yes.

Med-Arb and Arb-Med combine mediation with arbitration:

• Parties try to reach a settlement (mediation).
• If no agreement is reached, the same or different neutral acts as arbitrator.
• This allows both flexibility and finality.

Common in Asia, increasingly accepted in European cross-border contracts, especially in construction, IP, and supply chain disputes.

• Drafting ADR clauses in contracts
• Advising on ADR suitability
• Representing clients during hearings
• Reviewing and negotiating settlement terms
• Ensuring international enforceability of outcomes

In international ADR, your lawyer must also navigate:

• Language barriers
• Differences in procedural law
• Recognition and enforcement treaties