Alternative Dispute Resolution
Many consumers believe that when they have exhausted all attempts to resolve a complaint that the only way forward is to take the matter to court. Well this is not exactly true. There is another option Alternative Dispute Resolution (ADR). ADR schemes or an out-of-court mechanism involves an organisation which aims to solve disputes without going to court. The process involves the use of a third party such as an arbitrator or a mediator to help disputing parties reach a resolution.
ADR bodies range from ombudsmen or regulators, an example of the type of ADR schemes available here in Ireland is the Financial Services Ombudsman, the Pensions Ombudsman or the Advertising Standards Authority for Ireland. These ADR schemes are very important for consumers when shopping at home or cross-border as they give consumers access to redress should a problem arise.
The most commonly used dispute resolution processes offered by ADR bodies or organisations are mediation and arbitration. ADR is often less formal and adversarial than a court trial, it's also faster and cheaper. Any individual or business can use an ADR procedure without having to hire costly solicitors.
Mediation is based on the principle that people can resolve their own disagreements if given the right support. A mediator does not judge who is right or who is wrong, but works with parties to help them arrive at a solution to satisfy their interests.
Mediation usually provides a quicker, more cost effective and more satisfactory outcome than legal litigation. It may take months and sometimes years to resolve a disagreement in court, mediation can be paced according to the parties' needs and schedule. Mediation is voluntary and requires both parties agreement to the make a final resolution. In mediation, the parties are able to customise the resolution agreement to meet their needs rather than being constrained by the limited options available in court. Most important, parties are more likely to preserve an amicable relationship in the future.
Arbitration is a voluntary alternative dispute resolution process. Unlike mediation, a knowledgeable, independent, and impartial third party is empowered to make a decision. The arbitrator hears the disagreement between one or more parties and after considering all relevant information renders a final decision in favour of one of the parties. Arbitration decisions may be either binding or non-binding, depending on the terms of the arbitration agreement. Binding arbitration decisions may be confirmed by a court and carry the same significance as a court judgment.
For information purposes, it should be noted that there are, however, other forms of ADR, including early neutral evaluation, moderated settlement conferences, focus groups, summary jury trials, mini-trials, and direct negotiation.
As a consumer you have access to a range of ADR bodies who will handle a dispute on your behalf. Before you decide to take a case through ADR or the Small Claims Court you should consider the following:
- What is the value of your claim?
- If a claim is over €2000 a consumer will need to take their case through the District Court and may need legal representation.
- ADR procedures can typically deal with any value of dispute.
- What are the costs involved in pursuing your case?
- The fee for making an application to the Small Claims Court is €25.00.
- Many of the ADR Bodies offer their service free of charge.
- Do you have the time to attend a Court hearing?
- If a hearing becomes necessary under the Small Claims Procedure, you may be required to attend the hearing in person.
- Most ADR procedures do not require an oral hearing and disputes can be dealt with through distance communication, meaning you do not have to leave the comfort of your own home.
- Will the outcome of the action be enforceable?
- All judgements by the Small Claims Court are enforceable.
- ADR decisions may be either binding or non-binding, depending on the terms of the ADR agreement.
If you have a dispute with a trader in another European country you may wish to consider taking an action under the European Small Claims Procedure. Similar to the domestic Small Claims Procedure it can be used in civil and commercial matters. For further information about the European Small Claims procedure click here
In Ireland there are two types of ADR bodies, public ADR bodies and those that are set up privately by specific industries or ADR providers. ADR bodies may also be classified as sector-specific and generic.
Public ADR Schemes
Commission for Aviation Regulation
National Enforcement Body of Regulation (EC) 261/2004 relating to air passengers effected by delays, cancellations and denied boarding. www.aviationreg.ie
Commission for Energy Regulation
Regulates the electricity and gas markets.
Commission for Communications Regulation (ComReg)
Regulator for the electronic communications (telecommunications, radio communications and broadcasting) and postal sectors.
Financial Services Ombudsman's Bureau of Ireland
Handles unresolved complaints from consumers about their dealings with financial service providers.
Investigates and rules on complaints and disputes involving occupational pension schemes and Personal Retirement Savings Accounts (PRSAs).
Private Residential Tenancies Board
Registers tenancies and mediates disputes between landlords and tenants.
The National Transport Authority manages the regulation of the Small Public Service Vehicle sector in Ireland. www.transportforireland.ie/taxi/
Private ADR Schemes
Advertising Standards Authority for Ireland
Is a self-regulatory body set up and financed by the advertising industry. It investigates complaints about advertisements. If you are complaining as an individual or as a group of consumers, your identity remains confidential.
Direct Selling Association Ireland
Direct Selling is the marketing of consumer goods or services on a person-to-person basis - either where a product is demonstrated in the home or a catalogue is left with the customer. Consumers can submit a complaint to DSAI against one of its members.
Car Rental Council of Ireland
Is the representative trade organisation for the car rental industry in Ireland and investigates complaints against its members
Generic forms of ADR
Chartered Institute of Arbitratiors (CIArb) - Irish Branch
Offers dispute resolution services such as arbitration, mediation, conciliation, adjudication and expert determination. At present the Irish Branch has over 750 members.
Following an agreement between the Society of the Irish Motor Industry (SIMI) and the CIArb - Irish Branch, the terms and conditions of SIMI members include a Dispute Clause authorising the Chairman of the CIArb - Irish Branch to appoint an arbitrator when a dispute arises that cannot be settled between parties.
There is also a similar agreement between some tour operators and CIArb - Irish Branch to include a Dispute Clause referring unsettled disputes to the CIArb - Irish Branch scheme.
Mediators' Institute of Ireland (MII)
Is a professional association of mediators, established to promote the use of quality mediation as a process of dispute resolution in all areas.
Mediation Forum Ireland (MFI)
Provides a service for the resolution of conflict and disputes, through its referral service, parties can draw upon their network of over 100 independent mediators.
Electronic Consumer Dispute Resolution (ECODIR)
Is a project designed to improve access to low-cost dispute resolution for consumers and to facilitate the use of online alternative dispute resolution mechanisms.
CEDR Ireland was established in 2011 and offers a dispute resolution service providing arbitration, mediation and other ADR services to thousands of organisations and individuals across Europe. CEDR also works with organisations to develop schemes that are carefully designed to meet the needs of the organisation or the sector within which they operate.
The European Single Market has opened up many opportunities for consumers to avail of goods and services from any EU Member State. As a consumer it is of paramount importance that you feel confident when shopping in Ireland or any other EU Member State. Development and promotion of ADR at national level is critical in order to provide fair and efficient dispute-resolution mechanisms at European Union level.
In order to facilitate the resolution of consumer complaints the European Commission has encouraged, through two Recommendations, the development of ADR schemes in each Member State. Each Recommendation contains a set of Principles which an ADR body agrees to adhere to. Both recommendations ensure that ADR bodies offer all parties involved minimum quality standards.
- Relates decision-making forms of ADR.
- Relates to mediation-type ADR procedures.
Once a Member State is satisfied that an ADR body meets each of the principles of either of the Recommendations, the details of the ADR body in question are then be submitted to European Commission and placed on a Central database. If you would like to find out which Irish ADR Bodies are listed then visit European Commissions website. ec.europa.eu/consumers/redress_cons/adr_en.htm#coop
If you are interested in becoming a notified ADR body, please familiarise yourself with the application forms as well as the Guidelines and Procedures
drawn up by the Competition and Consumer Policy Section of the Department of Jobs, Enterprise and Innovation. Should you have any questions or require further guidelines, please contact us
and our Dispute Resolution Adviser will provide you with the necessary information.
New proposals on Alternative and Online Dispute Resolution
On 29 November 2011 the Commission proposed legislation to help consumers solve their disputes with businesses out of court. In introducing these legislative proposals the Commission indicated that its objective is to make it easier for consumers to secure redress in the Single Market, whether they are buying online or offline, and by thus enhancing consumer demand, contributing to growth and economic stability. This will mean that consumers will be able to solve all their contractual disputes through ADR entities without going to court, no matter what they purchased or, where the company is based within the EU.
You can find more information on the Proposals for a Directive on ADR and for the Regulation on Online Dispute Resolution by visiting the European Commissions website http://ec.europa.eu/consumers/redress_cons/adr_policy_work_en.htm