Arbitration and Alternative Dispute Resolution (ADR) in Nigeria: How to Choose the Best Method for Your Dispute

If you are involved in a dispute with another party, whether it is a commercial, contractual, or personal matter, you may want to resolve it without going to court. Going to court can be costly, time-consuming, and stressful, and may not guarantee a satisfactory outcome for either party. Therefore, you may want to consider using arbitration or other forms of alternative dispute resolution (ADR) to settle your dispute amicably and efficiently. Arbitration and ADR are processes that allow the parties to a dispute to reach a mutually acceptable solution with the help of a neutral third party, who can either facilitate the negotiation, or make a binding decision, depending on the method chosen. Arbitration and ADR have many advantages over litigation, such as:

– Flexibility: The parties can choose the method, rules, procedures, and language of arbitration or ADR, and tailor them to suit their needs and preferences.

– Speed: Arbitration or ADR can be completed within a shorter period of time than litigation, as the parties can avoid the delays and formalities of the court system.

– Cost: Arbitration or ADR can be cheaper than litigation, as the parties can save on legal fees, court fees, and other expenses.

– Confidentiality: Arbitration or ADR can be conducted in private, and the parties can agree to keep the proceedings and the outcome confidential, unlike litigation, which is usually public and subject to disclosure.

– Control: The parties can have more control over the outcome of arbitration or ADR, as they can either participate in the decision-making process, or choose the decision-maker, who is usually an expert in the subject matter of the dispute.

– Finality: Arbitration or ADR can result in a final and binding resolution of the dispute, as the parties can agree to limit or waive their rights to appeal or challenge the outcome, unlike litigation, which is subject to multiple levels of review and appeal.

However, arbitration and ADR are not suitable for every dispute, and they may also have some disadvantages or limitations, such as:

– Lack of enforcement: Arbitration or ADR may not be enforceable by the courts unless the parties have a valid and binding agreement to arbitrate or use ADR, and the outcome complies with the applicable laws and public policy.

– Lack of discovery: Arbitration or ADR may not provide the parties with adequate access to information and evidence from the other party or third parties, as the parties may have limited or no rights to discovery or disclosure, unlike litigation, which is governed by the rules of evidence and procedure.

– Lack of precedent: Arbitration or ADR may not create or follow any legal precedent or authority, as the outcome may be based on the facts and circumstances of the case and the discretion and expertise of the decision-maker, unlike litigation, which is based on the established principles and doctrines of law.

– Lack of fairness: Arbitration or ADR may not be fair or impartial, as the parties may have unequal bargaining power, or the decision-maker may have a bias or conflict of interest, unlike litigation, which is subject to the rules of natural justice and due process.

Therefore, before choosing arbitration or ADR for your dispute, you need to weigh the pros and cons of each method and consider the following factors:

– The nature and complexity of your dispute: You need to consider the type, scope, and magnitude of your dispute, and whether it involves legal, technical, or factual issues, or a combination of them. You also need to consider the amount and value of the claim, and the potential remedies or relief sought by the parties.

– The relationship and interests of the parties: You need to consider the identity, background, and characteristics of the parties, and whether they have an ongoing or future relationship, or a one-off or past transaction. You also need to consider the goals, expectations, and motivations of the parties, and whether they are willing to cooperate, compromise, or confront each other.

– The availability and suitability of the method: You need to consider the availability and suitability of the method for your dispute, and whether it is mandated or recommended by the law, contract, or court, or agreed by the parties. You also need to consider the costs, time, and resources involved in the method and whether they are proportionate and reasonable for your dispute.

Based on these factors, you can choose the best method for your dispute from the following options:

– Arbitration: Arbitration is a method of ADR where the parties submit their dispute to one or more arbitrators, who are neutral and independent third parties chosen by the parties or appointed by the court or an institution, who make a final and binding decision on the dispute based on the evidence and arguments presented by the parties and the applicable law and rules. Arbitration is suitable for disputes that involve complex or technical issues, high stakes or values, or international or cross-border elements, and where the parties prefer a confidential, final, and enforceable outcome.

– Mediation: Mediation is a method of ADR where the parties engage in a structured and facilitated negotiation with the assistance of a mediator, who is a neutral and impartial third party who helps the parties communicate, understand, and resolve their dispute by using various techniques and strategies, such as listening, questioning, reframing, brainstorming, and reality-testing. Mediation is suitable for disputes that involve personal or emotional issues, ongoing or future relationships, or multiple or diverse interests, and where the parties prefer a voluntary, cooperative, and creative outcome.

– Conciliation: Conciliation is a method of ADR where the parties consult with a conciliator, who is a neutral and independent third party who advises the parties on the merits and weaknesses of their case and suggests or proposes solutions or settlements for their dispute based on the facts and circumstances of the case and the applicable law and rules. Conciliation is suitable for disputes that involve legal or factual issues, moderate stakes or values, or domestic or local elements, and where the parties prefer a guided, informed, and realistic outcome.

– Other methods: There are other methods of ADR that can be used for specific types of disputes, such as negotiation, expert determination, adjudication, mini-trial, early neutral evaluation, and hybrid methods, such as med-arb, arb-med, or medaloa. These methods have their own features, advantages, and disadvantages and may be combined or customised to suit the needs and preferences of the parties.

Seek Legal Advice and Representation

The final step to choose the best method for your dispute is to seek legal advice and representation from a qualified and experienced lawyer who can advise you on the legal aspects and implications of arbitration and ADR, and represent you in the chosen method. A lawyer can help you:

– Draft and review the arbitration or ADR agreement, and ensure that it is valid, binding, and enforceable

– Choose and appoint the arbitrator, mediator, conciliator, or other neutral third party, and ensure that they are competent, independent, and impartial

– Prepare and present your case, evidence, and arguments, and ensure that they are relevant, persuasive, and compliant

– Negotiate and settle your dispute, and ensure that the outcome is fair, reasonable, and satisfactory

– Enforce or challenge the outcome, and ensure that your rights and interests are protected and respected

Arbitration and ADR are viable and valuable alternatives to litigation for resolving disputes in Nigeria, as they offer many benefits and advantages over litigation, such as flexibility, speed, cost, confidentiality, control, and finality. However, arbitration and ADR are not suitable for every dispute, and they may also have some disadvantages or limitations, such as lack of enforcement, discovery, precedent, and fairness. Therefore, before choosing arbitration or ADR for your dispute, you need to weigh the pros and cons of each method, and consider the nature and complexity of your dispute, the relationship and interests of the parties, and the availability and suitability of the method. You also need to seek legal advice and representation from a qualified and experienced lawyer who can advise you on the legal aspects and implications of arbitration and ADR, and represent you in the chosen method. If you need any assistance or advice on how to choose the best method for your dispute, or if you have any questions or concerns about arbitration and ADR matters, please contact us today for a free consultation and a quote on our arbitration and ADR service