10 Questions
What is a necessary condition for a dispute to arise?
There must be a contract between the parties.
What is a benefit of using Alternative Dispute Resolution methods?
It is a cheaper and quicker process than going to court.
What is a feature of negotiation as a dispute resolution method?
It is a low-cost and flexible process.
What is the purpose of a complaint letter in a dispute?
To formally notify the other party of a dispute.
Why may dispute resolution methods other than litigation be preferred?
Because many people fear the court process.
What is the main difference between mediation and conciliation?
Mediation involves a third party who facilitates negotiation, whereas conciliation involves a more active third party who proposes solutions.
Why might mediation or conciliation not be applied in a dispute?
When there is a great imbalance of power between the parties.
What is a benefit of mediation and conciliation compared to arbitration?
The parties have more autonomy and flexibility in the process.
What is the key difference between negotiation and mediation?
Mediation involves a third party, whereas negotiation does not.
What happens if a party breaks an agreement reached through mediation?
The agreement can be enforced by the government.
Study Notes
Dispute and Dispute Resolution
- A dispute arises when there's a conflict relating to the benefit of the parties, resulting from a breach of contractual obligations and disagreement on the breach.
- Dispute resolution methods include negotiation, mediation/conciliation, arbitration, and court/litigation.
Why Alternative Dispute Resolution (ADR)?
- ADR is cheaper and quicker than going to court.
- Many people fear the court process, including giving evidence, the risk of losing, long duration, and taking place in public.
Roles of 3rd Party
- In negotiation, no third-party involvement occurs, and both parties directly communicate with each other.
- In mediation and conciliation, a third party helps facilitate the discussion and transmission of proposals.
- In arbitration, a third party makes a binding decision.
Negotiation
- Features of negotiation include:
- Low cost (no need to pay for a third party)
- Speed of resolution (both parties know the situation and concentrate on the problem)
- Confidentiality
- Flexibility (time, place, and no formal procedure)
- Fairness (win-win situation)
- Ability to allow the parties' business relationship to continue
Documents in a Claim
- A complaint letter includes:
- Name and address of the parties to the dispute
- Objects of the claim (contract no., order no., B/L no., etc.)
- Specific matters requested to be settled
- Evidence, such as pre-claim letters, may be necessary.
Mediation/Conciliation
- Mediation involves a third party transmitting and interpreting proposals between the disputing parties.
- Conciliation is similar, but the conciliator sometimes advances independent proposals.
- Mediation and conciliation aim to help parties come to their own conclusion/agreement.
- Mediation vs. Conciliation: in mediation, the solution is reached and agreed upon by the parties, while in conciliation, the conciliator proposes solutions.
Mediation/Conciliation Limitations
- Mediation/conciliation is not applicable when:
- Both parties are not willing to mediate/conciliate
- Parties do not need to continue their relationship
- There is a great imbalance of power between parties
- Overwhelming emotions control
- There is a previous history of broken promises
Mediation/Conciliation Benefits
- Maintains and restores business relationships
- Resolves disputes cost-efficiently
- Provides party autonomy and flexibility
- Is a private and confidential process
This quiz covers the basics of disputes, including the definition of a dispute, the conditions for a dispute to arise, and the different methods of dispute resolution such as negotiation, mediation, arbitration, and court litigation.
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