ADR and Arbitration - Chapter 12
David Plant practiced law in New York City with Fish & Neave from 1957 through 1998. Since retiring from Fish & Neave, he has practiced exclusively as an ADR neutral and a teacher. For more than 20 years, he has served as a mediator in U.S. and international disputes, arbitrator in ICC, Stockholm, UNCITRAL, AAA, CPR, WIPO, court-annexed and ad hoc arbitrations, and Special Master in US District Courts - in more than 300 matters. He has written and spoken around the world on ADR matters. Mr. Plant is a Fellow of the Chartered Institute of Arbitrators, College of Commercial Arbitrators, International Academy of Mediators, and American College of Civil Trial Mediators.
From the other chapters in this book, it is abundantly clear that international commercial arbitration has many virtues. They have been realized again and again over the years. However, in some cases, costs and inefficiencies have exceeded both expected and actual rewards.
Ambrose Bierce has described litigation as “a machine which you go into as a pig and come out as a sausage.”1 Experience shows it is not a long stretch to define some international arbitration procedures in the same manner. Why?
In complex, commercial international arbitration, it is not unusual for counsel to take, and concurrently the parties to lose, control of the proceedings. Often, the process takes on a life of its own. Virtually every dispute in arbitration focuses on past misdeeds, sometimes to the detriment of a potentially constructive future relationship. The pathology of the process polarizes parties, to say nothing of depleting resources. Business people, lawyers, and arbitrators are frequently sensitive to this dynamic. When they are, they can do something about it.
Even when an arbitration is proceeding relatively efficiently and in accord with expectations, settlement before an evidentiary hearing is not uncommon. Often, this occurs through negotiations conducted by parties and counsel on their own – precisely what would be expected of competent counsel and informed business people. In some instances, such settlements occur with the assistance of a so-called neutral person, who facilitates the discussions between or among the parties and their counsel.
We explore here what parties and their counsel can do about resolving their differences short of time-consuming and resource depleting adversarial proceedings. We look at the possibilities offered by the ADR spectrum, whether or not any can be used in international commercial arbitration, how and under what circumstances, and with what expected results. Along the way, we touch on issues of professional responsibility.
II. WHAT IS ADR?
ADR means different things to different people. In the international arena, its meanings diverge due to cultural, language, and experiential backgrounds of parties, counsel, and arbitrators. Differences in definitions have engendered substantial, and not always constructive, debate. It is imperative that those who are considering ADR not permit their deliberations to founder on semantic shoals.
When the term “ADR” originated 25 years ago, it referred to Alternative Dispute Resolution techniques. As time passed, “Appropriate” has sometimes been substituted for Alternative, and more recently in the ICC’s ADR Rules, “Amicable” has surfaced in lieu of Alternative or Appropriate.
This is only one example of the semantic difficulties frequently faced in discussions of ADR and whether and when it is applicable. The examples increase exponentially when language and other cross-cultural factors come into play.