Alternative Dispute Resolution (ADR) refers to arbitration and mediation and other measures to settle a dispute outside the classical judicial system, i.e. without going to the state courts. Mediation roughly speaking means settling a dispute by negotiation, while in arbitration a dispute will be decided by an arbitrator or arbitral body agreed upon by the parties.
While mediation can be attempted in almost all cases, arbitration generally requires that the parties have entered into an arbitration agreement prior to the occurrence of their dispute (usually an arbitration clause as part of their contract).
Generally speaking ADR is very attractive for a couple of reasons:
It is often faster than trying to obtain a final judgment in court.
The outcome of a lawsuit is often unpredictable, while ADR allows the parties to choose the person/institution of the mediator or arbitrator who brings more sector specific expertise and thus increases predictability.
ADR allows to keep the dispute and its resolution confidential.
The parties can choose the rules of procedure according to their needs.
The costs for arbitration might be considerable, but arbitration can still be highly advisable at least for corporate parties to an agreement.
ADR plays an increasingly important role in Thailand. It just might offer a faster and more predictable dispute resolution than the local state courts. There is special legislation regarding ADR in Thailand, e.g. the Arbitration Act B.E.2530 (1987), the Arbitration Rules of Arbitration Institute, Ministry of Justice Conciliation Rules of Arbitration Institute, The Court of Justice Regulations Pertaining to Mediation of Financial Dispute of B.E. 2544 (2001), The Court of Justice Regulations Pertaining to Mediation of B.E. 2544(2001).
Some of our lawyers at Juslaws & Consult specialize in Arbitration, and others are skillful mediators. We believe that in the future ADR will become an even more important alternative to state courts in certain constellations. We have much expertise in drafting ADR-related contract clauses, and help you to decide if ADR is the appropriate dispute resolution mechanism.