ADRPT
ADRPT
ADRPT
Chapter One
General Overview of ADR
The nouns ‘Conflict’ and ‘Dispute’ are used interchangeably all time
and indeed, are synonymous for each other in English Language.
Abebe Semagne in his unpublished senior thesis also quoted
the meaning of dispute as;
“ a conflict or controversy; conflict of claims or right; an
assertion of right, claim or demand on one side met by the
contrary claims or allegations on the other; the subject of
litigation; the matter for which a suit is brought and which issue
in joined; and in relation to which jurors are called and witness
examined”
The other element of ADR is Resolution. The oxford Advanced
Learner’s Dictionary defines ‘Resolution’ as the act of resolving or
settling a problem, dispute, etc.
1.3. Historical Development of ADR
A. Cost of Litigation
Law suits are expensive. There are legal fees, filling fees and cost
that can be imposed against the losing disputant. There are costs for
being away from daily work to attend court hearing and at this
moment the employer increase cost. In some cases, too, the cost of
trying the case may exceed the amount of the judgment.
B. Time
It takes time from the commencement of the law suit until a
judgment at the trail. Even after the trial, the loosing disputant may
appeal and it may take a good deal of time before final decision is
rendered. The is also time that is needed for the implementation of
the judgment.
Cont….
C. Emotional Cost
Litigation is an emotional process. It increases tension between
the parties. Litigants consider, while they are out of court, what
they have said; what they should have said; what they will say;
how unfair the process; what they may come out under cross –
examination; and the consequence of loosing.
D. Litigation is Public
The public has the right to attend court proceeding but in few
confidential cases. The press report and comment on the proceeding
might be dispersed through different Medias. On the other hand, the
issues in the dispute may be confidential ones that the disputants do
not want to share with others. Litigants may be embarrassed about the
allegations made against them and may be made public regardless of
whether they are true or not.
Cont…..
E. Absence of creative solutions
Judges are empowered to decide the issue before them
according to the law, even if the solution to the issue is
best fit to the other issue. Judges interpret the law relevant
to the case and determine the case based on the legal rights
of the parties. They are not permitted to expand the list of
possible options to see if the particular case would be best
served by a solution that was not argued and that
application of the law would not allow.
F. Little Opportunity for the Parties to Vent Frustration
In court litigation the opportunity for the parties to say what
is in their minds and to express their views to each other is
very little. Litigants can answer questions when the rules
allow them to answer.
Cont..
There is no opportunity for them to talk about how the litigation
has affected them, or to vent about what has occurred. Although
there is discovery, indirect and cross- examination, there is no
opportunity to ask the questions that the parties want to ask each
other and to say what the parties want to say.
G. Unpredictability
In litigation, both sides argue the facts that they believe apply to the
issue to support their positions. However, at the end, the judges will
decide on the issue each side usually believed that his arguments and
analysis is better than the other side’s. However, the issue is
unpredictable and is necessary for the judge to make a decision,
which is binding. As a result a risk in going to trial and putting the
decision in the hands of the judge. Besides there is no guarantee
that the judge will always find the truth.
Cont…
H. Expertise of Decision Maker
In trail, the court selects the judge. Moreover, the judge may or may not
understand the unique attributes of the dispute. Judges may work hard to
learn the law relevant to the case before them and do their best to make
informed and reasoned decision. Nevertheless, they may lack the
expertise in all area to properly address the merits of the claim being
made.
G. Control over the Process
In litigation, the process is determined by procedural laws and by the
judge, the disputants have no control over it. They are told when to sit,
when to stand, when to speak, etc. they have no control who presents first
and who follows, when the process at a day will finish.
H. Win/Lose
In court litigation, a judge must, determine the winner and the loser.
There must be a loser in particular litigation. Therefore, litigation ends up
in determining the winner and the loser; not in an agreement or will full
disagreement.
Cont..
I. Decisions are Imposed
Court decision is imposed on the loser against his /her expectation.
People rarely like to have decision imposed on them. Most of the
judgment debtors of the court judgments perceive it as extremely
imposed and unjust. They consider themselves as loser. And even
though judicial enforcement mechanisms can be used, mostly they
attempt to avoid enforcement of this decision.
J. Damage to Relation
Usually the end of litigation leads disputants to hate each other and
their relationship is destroyed. The disputants may face difficulty to
amend their relationship to the point where they can do business
together and enter into future negotiation –they will take it not worth
to enter in to contact with their former adversary.
1.6. Demerits of ADR
A. In balance of power
The benefit of voluntary negotiating agreement may be undermined where there is
a serious imbalance of power between the parties –in effect , one party is acting
less voluntarily than the other.
B. Lack of legal expertise
Where a dispute hinges a difficult point of law, an arbitrator may not have the
required legal expertise to judge.
C. No system of precedent
There is no doctrine of precedent, and each case is judge on its merits, providing
no real guidelines for future cases.
D. Enforcement
The decision not made by the court may be difficult to enforcement. Don’t forget
that other ADR scholars take easily enforcement of compromise in ADR process
as one of the advantages of the system.
CHAPTER TWO TYPES OF ADR
• Types of ADR list cannot be exhaustive or final as there are various
dispute resolution mechanisms other than court litigation and it is still
evolving.
• The types of Alternative Dispute Resolution, however, can be
categorized in to three categories based on the procedures we follow
in each dispute resolution mechanisms. These categories are formed
by considering the kind of work product resulting from ADR and how
the parties participate. The categories of ADR procedures are
agreement, decision and advice.
1. Negotiation
Negotiation can be defined as: a non-binding procedure involving
direct interaction of the disputing parties where in a party approaches
the other with the offer of a negotiated settlement based on an objective
assessment of each others position.
It may be to agree to change or refrain from changing: their relationship
with each other; their relationship with others; their relationship with
respect to an object or object.
Cont….
Perceived advantages of negotiation
One special attribute of negotiation as a method of resolving
difference is flexibility, both with regard to the manner in which the
parties proceed and with respect to the ultimate accommodation
reached.
It allows difference to be adjusted in a way that either maximum
mutual gains or meets at least some needs of all parties to settlement.
A third attribute is that it implicitly recognizes the dignity and worth
of all participants since negotiated resolution requires the parties
assent.
Finally, unlike some other methods of resolving difference,
negotiation takes in to account unofficial as well as official values –
that is, it can reflect values that are important to the parties even
though these values not have legal status.
Contin…
Perceived disadvantages of negotiations
Firstly, as negotiation is all about bargaining, the parties have no
assurance that they will reach a settlement. Nevertheless, the process
requires an investment of time, effort, and often other expenses.
Secondly, the soundness of the resolution may be impaired if the
parties miss present their goal or the back ground information or if,
after agreement is reached, circumstances change from what one or
more parties anticipated during bargaining.
Thirdly, some times negotiated settlement does not satisfy
community mores or relevant and lawful interest of third parties and
thus, may be unenforceable or subject to one or more participants to
criminal penalties. Accordingly, it is not always the most desirable
means of resolving conflict.
Cont…
Legal effects of negotiation agreement.
If the parties conclude negotiation in line with the law, this agreement
will have effect on the agreed parties. Currently, the general policy of
the law favors negotiated settlement of current and future disputes for
the obvious benefit that which settlement brings- less litigation and
cost in terms of time and money for the parties and the courts.
Settlement agreement is, therefore, considered as contracts between
negotiating parties.
• In general, terms of agreement lawfully concluded by the negotiating
parties shall be binding on them as though they were law. This is to
mean that though the requirements for valid negotiation agreement
differ from country to country , an agreement which is established
with the free consent of the parties in dispute and as to the specific
requirement specified by the law at hand , the agreement will be
binding upon the parties.
2. Mediation /Conciliation
Varieties of Arbitration
1) Ad-hoc arbitration is form of arbitration where the procedure of
arbitration, an most of the time, set by the disputing parties them
selves. Parties in a dispute need not stick on the institutional
procedure. The national law of the place of arbitration avoids
any problem arise of ad-hoc arbitration.
2) Contractual in built arbitration came to juncture due to
increasing of business transaction with complex phenomenon.
While business relation increased, presumably clashes b/n
parties in the transaction is natural, and this scene called for
regular machinery in the shape of in built arbitration clause, an
integral part of the contract covering present or future disputes
and the system devised was reference to named arbitrator or on
arbitrator to be appointed by a designated authority.
Cont…
3. Institutional arbitration- this is another form of arbitration and
probably most conducive for the parties’ as the parties agree in
advance that in the advent of future disputes they will be settled by
arbitration by the named institute of which one or more of them
were members.
In institutional arbitration parties’ dispute is arbitrated according to
pre- establish rules of the institution, which most of the times
known to disputing parties. The Arbitrators mostly, are among
named specialists.
4. Statutory arbitration:- the above three kinds of arbitrations are
constituted by the consent of the disputing parties. Where as
Statutory arbitration is an imposition by law which governs the
parties in dispute- parties should submit the case to specified
person or institutions for arbitration to resolve their case
irrespective of their consent.
Arbitration and litigation
• In Ethiopian case one can not find definition about what partiality or
impartiality is all about. Nevertheless, Art 3340(2) civil code of Ethiopia
specifies ‘partiality’ as one of grounds to the disqualification of
arbitrators. Art 3340(2) reads “The arbitrator appointed by agreement b/n
the parties or by third party may be disqualified where there are any
circumstance capable of casting doubt upon impartiality or….”
This article tells us the following matters:
1. Let alone real biasness of an arbitrators even circumstance which gives
reason for reasonable person to doubt the impartiality arbitrator can be
ground to disqualify arbitrary.
2. Only arbitrators who are appointed by agreement of conflicting parties
or by third party, who is entrusted to appoint arbitrators, are duty bound to
be impartial. Party appointed arbitrator seems can be partial to a party who
appointed him.
Independency of arbitrator
Introduction
In Ethiopian history this was the fact before the formal
establishment of courts in the 1940’s and after that in some
localities.
The above discussion gives us some light about the
administration of justice our early history. But this was not the
only means of settling dispute and making justice. The formal
adjudicative function of the governors in their different
hierarchy contributes only for the settlement of some of the
disputes. Most of the disputes were settled by elders, religious
leaders, like priests, or clan chiefs elected by the community.
Cont…
Under the FDRE constitution customary laws and practices have been
given due cognizance unless they are not contrary to the legal norms.
Reference can be made to articles 9, 34(5), 41(9) and 91 of the same.
These show as still now customary norms are sources of law in some
subject matters.
Customary laws of Ethiopia which are different in form and substance
are deeply rooted in the traditional institutions of each ethnic group.
They are not uniformly applied but are mostly peculiar to ethnic groups
with some exception.
Among the subject matter where the customary laws are still enforce are
administration of justice or settlement of disputes. We have ample and
unique ways of settling disputes of any nature and degree arisen among
themselves and with their interaction to other ethnic groups. Some exist
though they are contrary to public policy, like arbitrating criminal
matters between the victim and accused.
Common characteristics of customary dispute settlement
• Art. (274) of civil procedure code provision gives the parties the right to terminate
all or part of the claim (including accessory matters like cost, damage and
execution 276) for which a substantive litigation has been instituted and proceed
with compromise.
• After a case has been instituted before a court of law compromise can be made in
two different ways; one during the hearing before the court of law and the other is
out of court. In both ways the content of agreement is advised to be drafted in line
with the Art 276(1).
• Compromise in a pending case can be initiated by either of the disputant by their
on motion or possibly by the court in the attempt of reconciling the disputants. In
any of these cases, however, the willingness and consent of the disputants is
mandatory and the court, in no way, can force them to do so. If they agreed to
reconcile the matter, they can do it at the hearing before the court of law. This
agreement will be made in written form and signed by both of the parties. The
court after being satisfied that the contract is not contrary to law and public moral
will entered the compromise in the case file and make a decision or judgment
accordingly. And this will end up the litigation between the parties (277).
Cont…
• The other alternative is the parties can make the compromise out of
the court room. Is such come to happen, the court shall be informed of
such a matter and the plaintiff may apply to the court for permission
to withdraw from the suit (277(3)). The permission granted by the
court will enable the plaintiff to institute a fresh suit in respect of the
same subject matter of the suit in case if they failed to agree and end
up the dispute in compromise (278(2)).
Conciliation
• The corresponding right of the conciliator will be to get due respect and
recognition from the disputants. In addition, he "shall be refunded of any
reasonable expense he has incurred in the discharge of his duties". This is
some sort of compensation for the money he has spent during the
proceeding while facilitating the compromise. But for the time he devoted
and service he delivered, there won't be any payment or remuneration
unless the parties expressly agreed (3323).
Effects of Conciliation
• After you get in to the proceeding, there are two possible outcomes;
compromise or non conciliation. If it end up with success and the parties
sign up on the compromise that will be the end of the case and the one we
have discussed above about the effect of compromise (e.g. res judicata)
will apply. This means if the parties have expressly undertaken in writing
to confirm the terms of compromise drawn by the conciliator, they shall be
bounded by it.
Cont..
• This is the most widely used and commonly known type of ADR. "It
is the submission of a dispute between two parties to a third impartial
(arbitrator) with the agreement that the decision of the arbitrator will
be binding and final. It is a quasi-judicial procedure that avoids the
formality, delay and expense of normal trial.
• Under Ethiopian law, arbitration is regulated in more detail than any
other kinds of ADR. The civil code provisions of Arts 3307 – 3346,
civil procedure provisions which are scattered in different parts of the
code, the family code, labour codes are only some of them. This by it
self shows us how arbitration has got a place under Ethiopian law.
Sources of Arbitration and Arbitral Submission
A. Source of Arbitration
The first thing we have to see here about the valid source of
arbitration, which is either consent or sometimes from the law.
Arbitration emanates either from consents of parties or from law. (Art.
315(c)).
a) Consent (agreement) – when arbitration emanates from
agreement, the arbitral submission should fulfill requirement
of valid contract (Art. 1678 c.c.) and observe mandatory laws:
parties should have the capacity to contract and dispose of that
right without consideration, the contract should be in a written
form and other forms required by law for disposing the right
without consideration (Arts. 3326 c.c. and 315 c.pr.).
Cont…
b) Law: - In certain matters, like family dispute, the substantive law provides a
compulsory arbitration (e.g. family matters – arts 725- 728 c.c.). In such cases
either the law itself provides details of arbitration proceedings or let it to parties
determination (agreement) in which the agreement or the contract should
observe the above applicable rules.
B. Arbitral Submission
Arbitral submission can be a separate document or an arbitration clause attached to
the contract creating the right that creates the dispute. Such dispute may be an
existing one or future disputes which may arise out of contract or other specific
obligation (Art.3328 c.c.).
Jurisdiction of arbitrator in the submission should be interpreted strictly. An
arbitrator can do such but he cannot decide over the validity of the submission if
contested (Arts. 3329 and 3330 c.c.).
Arbitral Award
• There are limited grounds for application. As per art 356 Civ.
Proc.Code
1. When arbitrators decides matters not referred to it or when
the submission was invalid or had lapsed,
2. In case of two or more arbitrators, when they did not act
together,
3. When arbitrator delegates his authority to a stranger, to one
of the parties or to a co- arbitrator.
• After receiving the application, the court will fix date for hearing
and will summon and serve the copy of application to the other
party. The application may be dismissed which validates the
award given, or the award will be null and void and will be set
aside if the application is granted (Art. 357 c.pr.).
CHAPTER FOUR
ADR IN INTERNATIONAL AND REGIONAL LEVEL
D. Development of e-commerce
The development of e-commerce also increased the need for
ADR. Given the difficulties of processing e-commerce disputes
in a global e-market place, on-line dispute resolution has become
an attractive alternative, particularly in small disputes. When
ADR processes, such as mediation and arbitration, occur in the
on-line environment, it is often referred as online dispute
resolution (ODR).
In the context of civil disputes ADR processes, such as
negotiation and mediation, introduced a civilized way to resolve
international conflicts. They were designed to overcome the
limitations and failures of domestic judicial processes and the
lack of a binding international public process.
Cont…
• The first one is the identity of the parties that have the right
to institute a case or defend their case before these tribunals.
It is only sovereign sates and some times international
organizations that can be a party before the ICJ. By the same
taken, the WTO tribunal accepts claims only from member
states. In terms of the subject matters which can be seen by
these tribunals, all; cases can’t be entertained before them.
Most of the time ICJ entertains disputes “concerning issues
related to frontiers and maritime boundaries, territorial
sovereignty, the non-use of forces, non-interference in the
internal affairs of States, diplomatic relations, hostage-
taking, the right of asylum, nationality, guardianship, rights
of passage, and economic rights.”
Scope and Parties to International ADR
• The Convention which could be said the first in its nature and content
came in to the hands of leaders in the late 1890’s for approval. The
same document, with out affecting the status of the existing one and
as well the commitment of signatories, by enclosing a more detailed
stipulation came in to existence in 1907. These two conventions are
the founding documents of the Permanent Court of Arbitration (PCA),
which is established two decades before the establishment of the
Permanent Court of Justice in the late 1910’s, which is now replaced
by the International Court of Justice.
3. UNCITRAL Documents