Alternative Dispute Resolution...Why?


I have been asked to take part in ADR. Am I required to do so?


Alternative Dispute Resolution or ADR is a means by which disputes between customers and dealers may be resolved without resorting to the Courts.

In recent years the Government has encouraged and legislated for ADR, with the principal intent of reducing the number of disputes brought before the Courts, thus saving money from the Ministry of Justice budget. As a result, a whole new industry has been built up around the ADR mantra.
ADR includes:

•    mediation, where an independent third party helps the disputing parties to come to a mutually acceptable outcome;
•    arbitration, where an independent third party considers the facts and makes a decision, which is often binding on one or both parties.

The quality and independence of ADR service providers is something of a curate’s egg and outcomes are often patchy.

Since October 2015, if an agreement cannot be reached as to repair, replacement, price reduction or refund then the dealer is required by law to inform the customer of the name and website address of a Trading Standards approved ADR body to whom the complaint might be referred.

However, participation in ADR is only mandatory for dealers if it is a condition of any trade association and submission to ADR is a term and condition of membership of the Association to which they belong.

Moreover, since the Small Claims Mediation Service is free for claims of less than £10,000, there would seem to be no real merit to be had in agreeing to a funded ADR scheme, unless there is some compulsion to do so.

For further advice on ADR or to enlist our help in conflict resolution Lawgistics members can contact the legal team.


Authors: Howard Tilney

Published: 05 Jul 2016


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