The primary criteria should be cost. Is your expense justified; is your potential settlement proportionally large in relation to the expected cost? (This criteria also should be used in evaluating your method of ADR, as arbitration is also more expensive than negotiation.)

The second factor is immediate or quicker resolution of a specialized problem. "Even though a dispute is justifiable and serious, courts are not the best forum when the decision calls for an expert, on-the-scene determination and when delaying matters to get a more careful and accurate judgment from the courts will destroy the values that immediate finality would assure." (Murray/Rau/Sherman 33)

William J. Dixon, of Dixon Engineering, Inc., has a unique background which enables him to "understand" the real issues. Having been a contractor, engineer, and lawyer, he know the legal issues that will be argued in court and he also knows what the actual field issue is.

The first step in the ADR process is to have both parties agree to ADR in some specific form, negotiation, mediation, or arbitration, or to disagree on ADR in general. The meeting is then established between both parties, or all parties as the case may be, and the actual rules of procedure of ADR are established. It could as simple as both sides presenting their case to the arbitrator within a restricted period of time, such as one hour, and an immediate decision required by the arbitrator, or it could be much more complex.

In a complex situation, the first step is trying to establish all of the issues and, either through an immediate negotiation process or mediation process, to eliminate as many of the peripheral issues as possible. Issues which would require arbitration would then be separated out. If mediation is used, then the mediator may be privileged to confidential information which may adversely affect an arbitration hearing and another arbitrator may be required. But we would continue to finish the mediation portion and also, as part of the mediation portion, establish the rules of arbitration. An arbitration could be as expensive as a court case if restrictions are not put on both parties. Remember, you are making the rules at this point and you can limit not only the amount of deposition, but also the number of witnesses, the amount of time for presentations, and any other items which may affect the cost, as long as both parties agree to these limitations. Also, remember that in your contract documents the method of dispute resolution is a part of the contract and must be followed. However, as a part of the contract it can be changed by a change order just as any monetary portion of the contract can be changed. A schedule is then established and, if our representative has been conflicted through personal information in mediation, a schedule is established and an alternative arbitrator is brought in. If our representative is not compromised, then arbitration is scheduled with him.

ADR is a very useful tool and should be practiced by every company. No dispute should be allowed to sit and simmer. The quicker resolution is cheaper for all involved and may be a more justified solution.