Do you think that the courts offer the best means of solving a dispute?
Written by Harriet Levett (Feb 2005)
The most well known form of having a dispute settled is via a court case (litigation). This is the most traditional method of solving a method in the English Legal System. But for civil matters is not the only way to resolve an issue. A sideway step from the courts is the tribunal system. Tribunals are used instead of the courts for certain types of cases. Litigation is not the only available method of exploring a case however. There are other methods that can be used to settle a dispute these methods are called alternative dispute resolutions (ADR). They include: negotiation, mediation, conciliation and arbitration. All have their advantages and disadvantages.
Litigation (taking it to the courts)
Litigation involves the taking of a claim to court (this is any of the courts within the hierarchy). A claim is taken to court due to the feeling of a singular party (or both) that there has been a wrongdoing and some sort of settlement is thus required. It usually involves business or individuals having their case heard by a judge and sometimes a jury (in applicable cases). Recently it has been said that people are not taking advantages of the other methods that are available to them and people are too quick to run to the courts for a solution causing a lot of clogging in the court system. Thus judges have been given the right to postpone or ‘stay’ cases so that the parties may explore other options of settling before resorting to the courts Civil Procedures Rules 1999.
Advantages
Litigation has its advantages dispute its recent discouragement. A qualified judge will definitely hear the case. This means that any point of law that arises will be addressed via the perspective of a legal professional (which is not always offered in other methods). Due to the highest level of complexity of court cases the level of competency that is required is heightened, this means that the likelihood of having a fair and correct verdict is also thusly higher. Also, the verdict is legally binding and enforceable. There are appeal routes available but only on points of law; it is likely that the decision will be final and unchanged. However, if a case does need to be appealed the avenues by which to do so are clear and uniform. This makes the process a lot easier to pursue.
With litigation it is a lot easier to predict the outcome of the case. All courts below the House of Lords are bound by past precedent. This means that the decision of the case must be in compliance with previous decisions unless it is significantly different. This means that obtaining legal representation and advice is a lot easier and there is a relatively low risk of shock in terms of the result.
Another advantage of litigation is that in some cases legal funding is available from the state. Also there is legal aid available via Law centres, CABx, solicitors and barristers. Other forms of resolution do not receive any funding (with the exception of some tribunals).
Furthermore court cases are public and often important cases receive media attention. While this can be a disadvantage, for some businesses it is seen as an advantage because the firm that is seen as the ‘wrongdoer’ receives negative attention for this.
Disadvantages
The court system itself is often delayed due to the sheer number of cases going to trial and demanding time and attention. Courts are well known for their delays, however there have been recent implementations to lessen delays and begin keeping a tighter schedule (to be discussed later in the Woolfe Report section). Also, cases tend to be long and drawn out with the calling of witnesses and experts etc. Court cases can end up lasting years with continuous costs and complexities.
Taking a case to court is very expensive. There are costs beyond the employment of a barrister or solicitor. There are court fees, witness fees, initiation fees, application fees and processing fees. The amount ended up being spent on a case can mount up beyond what is affordable for the business, firm or individual involved. Sometimes the costs can be so high that they consume a significant amount of the money won via the claim. For some individuals, especially those facing firms the costs are hard to manage. Firms often have a legal allowance fund for cases that go to court, this also helps them obtain very good representation that individuals alone can not afford, putting them at a disadvantage. Cases in the courts also are not flexible and may require travelling and various days off of work to attend the court, yet another cost.
The trial itself is often a very formal and intimidating process. This often makes individuals uncomfortable in their surroundings. This hard process may also drive wedges between the two parties ending any possibilities for relationships in the future. This is often due to negative media attention. The complexities of a court case are often incomprehensible for those that are not legally qualified; this makes it quite difficult for some people to follow their own case. Even judges may have difficulties understanding issues specific to the field in which an expert would be more effective.
Appeals are hard to get, only with particularly compelling issues, substantial points of law or injustices in the trail (i.e. biases) are appeals granted.
Woolf Reforms
In Woolf’s Access to Justice Report 1996 he outlined various recommendations for the civil justice system (primarily litigation). However in 1997 few of the points had be addressed let alone achieved. His problems with the system involved its lack of impartiality, its expense, complexity, lack of speed and uncertain ends for many cases. Obviously his main focus was on the delays of the system, thus a majority of the 303 recommendations revolved around this problem. He proposes a “track solution”. This has recently been very effective.
The system involves all claims under 3,000 pounds (recently raised to 5,000) go to a small claims division, there is a fast track division for cases up to 10,000, and a multi track procedure for cases over 10,000. This involves fast track cases lasting only a day and various schedules being set to minimize the time spent on a case. There are also clear outlines for when paperwork must be deal with etc. making the system a lot more effective.
He also gives judges more powers to ‘stay’ cases and encourage the use of ADR before rushing to court. Also the simplification of procedures and documentation is of benefit to the system. These ideas were implemented in 1999 and have been very effective in terms of litigation and the increased use of ADR.
Civil Procedures Rules
Allocating resources according to the case, and simplifying language (i.e. plaintiff to claimant), ‘staying’ cases, and timetable management from the judge have all been implementations via these rules. This helps cases move quickly and ensures that the parties understand the court process and their case a lot more this creates a more just system which is of benefit to society as a whole.
Tribunals
Tribunals are not viewed as ADR. The parties of the case do not choose to partake in a tribunal. Certain types of cases have to go to arbitration rather than via litigation. However, in all situations ADR can be used prior to going to a tribunal (e.g. ACAS).
There are two different types of tribunals: administrative and domestic. Administrative tribunals are used to enforce rights that may have been infringed upon. With 70 different types of tribunal within this category the total number of tribunals is quite large at over 2,000. The main types are: social security rent, immigration, mental health and employment tribunals. Domestic tribunals are in house tribunals in which the issue is dealt with within they institution it occurred in this method is used by the FA and the Law Society for example.
Advantages
As tribunals do not encourage the use of legal representation the cost is a lot lower than litigation. Furthermore, it is very unlikely that a chairman will do an order of payments meaning the losing partner is not landed with a large bill at the end of the hearing.
Tribunals are slighter more informal and thus simpler than the courts. Also they tend to be quite private avoiding media attention for firms or individuals that do not want it.
Disadvantages
While is it viewed as cheaper because legal representation is not encouraged those without a solicitor only have a success rate of 28% as apposed to the 49% success rate of those with legal representation. So perhaps the lower costs are outweighed by the low possibility of winning the claim when this step is forgone.
Because chair-people tend to only sit part time those cases that go beyond a one day trial often end up with long drawn out trials to avoid mass duplication. These delays are a large problem, especially in extremes when cases have lasted over 2 years.
Some tribunals still do not give reasons for their decisions. This makes it difficult to appeal on a point of law or for injustices in the trial. However, this is being taken into account and when asked for these tend to be available now.
Analysis
It would appear that this traditional version of solving a dispute is rather effective as a lot of other methods do also incur some cost perhaps this version with binding results and clear appeal routes is the best way to solve a dispute. However, I don’t think that litigation should be utilized independently. In conjunction with ADR all cases that do not need to go to court can be weeded out, helping to lessen the sheer amount of cases going through the system. With recent reformations in the system which are without a doubt very beneficial to the litigation process the idea of taking a case to court is a lot less daunting and perhaps more effective. When used in applicable situations, yes, litigation is the best option for many cases.
ADR
ADR involves all methods that are used instead of or in conjunction with litigation. Negotiation, mediation, conciliation and arbitration are the main methods.
Negotiation
Negotiation is the finding of common ground between the parties themselves. This can involve direct contact (party to party) or with the use of solicitors or other representatives.
Advantages
Beyond the fees of a solicitor for his/her time (if one is used) negotiation is free. There is no time constraint on negotiation and parties can continue to use it even when the court process is underway. It gives the parties an opportunity to save themselves time and money and independently resolve their dispute in civil fashion. This method preserves a relationship allowing the firms or individuals to continue to work together in the future. Also this method is informal and is private.
Disadvantages
Negotiation does not have a guaranteed end and often is ineffective. Its results are not legally binding and the dispute may always arise again. Certain parties may not be willing to participate and are not obligated to do so.
Mediation
This is when two parties with the assistance of a neutral mediator seek common ground and attempt to compromise. The mediator explores both sides of the case and helps the parties reach a settlement, however the suggestions of solution are only made by the parties themselves. This is often used for neighbourly disputes (noise, parking) and boundary disputes.
Advantages
With the hope of cooperation this method can keep things private, maintain a relationship and help solve the problem with minimal expenses, relatively quickly and without the courts. This can be made flexible in terms of scheduling and remains informal (being inquisitorial rather than adversarial). It is also relatively successful with over 80% of methods tried this way being resolved. It is fairly cheap with a mediator costing about £1,000-1,500. This is a lot less than a court case and with the encouragement of self representation eliminates the cost of representation.
Disadvantages
This method once again has no guaranteed end and it relies on the parties’ willingness to cooperate. It can be very drawn out and may not result in any settlement at all.
Conciliation
Conciliation is similar to mediation but the third party is more active in terms of suggesting solutions. The most well known example of conciliation is ACAS (advisory conciliation and arbitration service). ACAS deals with employment and tribunal situations. ACAS is informed of every employment tribunal to take place and they offer their services in an attempt to resolve the dispute without going to a tribunal.
Advantages
Advantages of conciliation are very similar to that of mediation. It is cheap, friendly, private and informal.
Over half of the claims filed with ACAS are successful without having to go to tribunal.
Disadvantages
Disadvantages are also very similar to those of mediation. Court action may still be required as not ends are guaranteed and is very dependent on the parties, the decision is not binding and issues may continue to arise.
Over half of the ACAS claims filed received smaller settlements than they would have having taken the claim to a tribunal (however this must be weighed against the costs that would have incurred having advanced to a tribunals (solicitor fees)).
Arbitration
This is when two parties submit their cases to private arbitration. An arbitrator often an expert in the pertinent field hears the case in the form of a ‘mini trial’ type situation. Self representation is encouraged but legal aid from a representative or legal presentation is also acceptable. This results in a written agreement decided by the arbitrator. There are often Scott v Avery clauses in contracts, for example with holiday companies, that say in the case of a dispute the parties will go to arbitration.
Advantages
Arbitration’s main advantage is that it involves experts. This means that the people will be more able to understand the issue specifically for its content beyond the law, this then allows for a decision that is aimed specifically at the case itself. Because parties can pick their arbitrator they can do this in accordance with fees and with the level of expertise in the field. This also saves time and money as witnesses aren’t need as much to explain the issues to the judge as the arbitrator is already familiar with the
situation.
Arbitration hearings are a lot easier to schedule and are made to suit the schedule of those involved, making them more flexible that court cases. This also makes it slightly more informal that a court hearing. Arbitration is another form of settling privately meaning people can continue trading after the situation is resolved. This method is also a lot quicker than having your case heard in court, once again saving time and money. Furthermore, he decision here is binding and can be enforced via the courts.
Disadvantages
Points of law that may arise during the case are difficult for the arbitrator to address in comparison with the judges of the courts. This means that an injustice may occur due to confusion in these circumstances. And with arbitration the appeal routes are often limited and complicated making it extremely difficult for parties that want an appeal to receive one.
Professional arbitrators are often expensive and some companies that have Scott v Avery clauses that insist on arbitration may have a specific arbitrator that they have used before and biases in judgment may become an issue for the other party involved. In terms of an individual v. a company the issue of the company having better legal representation is also an issue. While self representation is encouraged companies do not tend to do so, instead they use a company lawyer or employ one. If the apposing individual intends to do well in the case it is essential at that point that they receive legal aid via an expert in the area or hire a solicitor/barrister themselves. This once again increases the expense of this route.
Delays for international and commercial arbitration are comparable with those delays found in courts. Delays would then be very inconvenient and may even be heard quicker via litigation.
ADR Analysis
ADR is a very good idea theoretically of dealing with disputes. However it is too dependent on the co operation of the parties. It can be suggested that if they refuse to negotiate then why would they succeed with any of the other methods that essentially use the same basis of compromise to resolve the problem? And with negotiation being the cheapest and easiest method then the other methods seem fairly unnecessary. On the other hand their success rates have been relatively good. Thus on the basis that they parties do have a mutual interest in privately and cheaply resolving the issue then ADR is the best option for those cases. However it is felt that few cases would result in a fair and final decision as a result of any of these methods and perhaps even the attempt of these methods just wastes time for cases that inevitably will end up in litigation.
Conclusion
Neither ADR nor litigation is solely better than the other, neither one is the “best” way to resolve a method for all cases. Each case should be independently considered for both methods. This is the reason that the legal system has created both ways, to cater to all cases, those that require litigation and those that can use other ways. And of course many cases benefit from the use of both methods together. Thus for some cases taking the claim to court is the best option, however, for some cases taking the claim to court is the worst option. The system works together in order to maximize the benefits of all methods.
Written by Harriet Levett (Feb 2005).