OPINION: As satisfying as it may seem to announce that you’ll see your adversary in court, a good lawyer may be duty bound to tell you otherwise.
Nowadays, the range of alternatives to litigation are so well developed that a dispute may be resolved without anyone ever taking the stand; and that means just about any party from Qantas and the unions, to participants in a global cartel, to prospective divorcees like Kim Kardashian or even those fiercest of opponents, neighbours squabbling over the cost or alignment of a suburban fence.
Since at least the 1970s, there have been initiatives to develop more formal alternatives to litigation or court-based determination. I say more formal because negotiation and arbitration have existed for hundreds of years. But, for many citizens having their “day in court” is still seen as the exemplar of dispute resolution.
Alternative dispute resolution (ADR) grew out of a desire to empower and better meet the needs of disputants’ as well as dissatisfaction with the adversarial court system and its associated costs and delays. But, the court system has not stood still and significant steps have been taken to combat the twin evils of cost and delay. Consequently, alternative dispute resolution is now being referred to as “appropriate dispute resolution”, as the emphasis shifts towards finding the best or most appropriate way of resolving a particular dispute.
Mediation has become an accepted, perhaps even highly sought after, method of dispute resolution in an extraordinary array of areas from commercial to family, native title, consumer, property and employment disputes.
Arbitration has been reinvigorated with the Federal Government seeking to establish Sydney as an arbitral hub for the resolution of international disputes with the opening of the Australian International Disputes Centre and the passage of amendments to the International Arbitration Act 1974 (Cth).
Further, the domestic use of arbitration has been bolstered by the Commercial Arbitration Act 2010 (NSW), which despite its name, can be applicable to a broad range of disputes.
Specialist subject-matter specific dispute resolution schemes have also boomed. The Financial Ombudsman Service resolves disputes between consumers, including some small businesses, and member financial services providers. Similarly, the Telecommunications Industry Ombudsman provides dispute resolution services for small business and residential customers who have a complaint about their telephone or internet service. There has also been a mainstreaming of other forms of dispute resolution, such as Med-Arb, facilitation and expert determination.
The growth in dispute resolution processes has not proceeded only by voluntary adoption. For some time now, courts have been able to refer parties to mediation over the protestations of both lawyers and clients. The courts also allow for early neutral evaluation and the use of referees. The matching of a process to a dispute has become part of the court's case management “best practice” in seeking to do justice quickly and cheaply.
Since the enactment of the Commonwealth’s Civil Dispute Resolution Act 2011 (Cth), which commenced on 1 August of this year, disputants have been required to take "genuine steps" to resolve disputes before commencing proceedings.
Although the meaning of genuine steps is not specifically defined, a number of examples are put forward, such as consideration of the use of alternative dispute resolution processes with a view to resolving some or all of the issues in dispute. The court may take into account the genuine steps taken by a party in exercising the court's discretion and powers, especially in relation to costs. Disputants are now obligated to consider if a non-court process could resolve the dispute.
However, the need to consider a range of options for resolving disputes other than litigation does not mean litigation should be ignored.
The courts wield the power of the State, they interpret the laws, ensure procedural fairness and render binding decisions in public that authoritatively state the law for the parties involved, and society at large. Frequently they achieve these goals without delay or exorbitant cost. Often they are innovative and accountable, through developments such as the Federal Court's Fast Track and the concurrent hearing of expert evidence. These unique features may be needed for a particular dispute.
The matching of a dispute to an appropriate process also operates within the courts as litigation is not a uniform process. Consideration needs to be given not just to what jurisdiction, court or list a case should be commenced in, but what procedural approaches should be pursued. For example, should a case be pursued one on one with an opponent or are other procedural devices such as class actions needed?
It also needs to be recognised that ADR and the courts may actually go hand in hand so that the most beneficial or efficient outcome may require a combination of both. Mediation may be desired but there still may be merit in invoking the court’s processes to facilitate the provision of essential information through discovery.
Appropriate dispute resolution necessitates an awareness of the range of dispute resolution processes that are available and consideration of the advantages and disadvantages of each process for the specific dispute.
As a result, a client seeking advice needs a lawyer that can deal with the merits of the dispute by applying substantive law to determine prospects of success but also by determining what process would be appropriate to attempt to resolve the dispute. Relevant factors in this selection include: costs, urgency, the desire for confidentiality, the need to maintain an ongoing relationship, types of remedies sought, whether a legal precedent is required and the need for the procedural protections of the court process.
Many options for dispute resolution are now well established. Reflexive resort to the courts is gone. Careful consideration of appropriate processes is the best service a lawyer can provide.
Michael Legg is an Associate Professor and Convenor of the UNSW Law’s 40th Anniversary conference, “Dispute Resolution in the Next 40 Years: Repertoire or Revolution”, 1-2 December 2011.
A version of this opinion piece first appeared in The Conversation.