Choose an element of ADR.
[You need choose only one element, such as “negotiation” or “mediation.”]
Explain how that can be helpful to a business in reducing its risks or costs in litigation.
Explore as well disadvantages or dangers to either side in a commercial dispute. What
must a business be aware of?
Because litigation, a process that provides solution between business disputes through the court system,
is pricey and time consuming, businesses are turning to alternative dispute resolution (ADR). Alternative
dispute resolutions such as negotiations, mediations, and arbitrations are used to sele business
problems outside of the courtroom. Arbitration, a formal method of alternative dispute resolution, calls
for an arbitrator to sele the business disputes. Arbitrator, usually a neutral third party or a panel of
experts, listens to the problem and presents a decision for the parties (Miller & Cross, 2013). There are
advantages and disadvantages for using an arbitrator. This alternative can be helpful to a business in
reducing its costs because the process is faster and less complicated than the court procedures. Spencer
(2015) explains that resolving a problem by arbitration provide a clear indication that all disputes are
arbitral which reduces tactics that increase payment obligations. Moreover, the discover procedures are
limited which saves the business parties substantial time and expense (Spencer, 2015). In terms of
reducing risks for the business, a bene.t of using arbitration include con.dentiality. “Arbitration hearings
do not take place in open court and transcripts are not part of the public record. This can be very
