ADR:

Alternative Dispute Resolution (ADR) is the procedure for settling disputes without litigation, such as
arbitration, mediation, or negotiation. ADR procedures are usually less costly and more expeditious.
They are increasingly being utilized in disputes that would otherwise result in litigation, including high-
profile labor disputes, divorce actions, and personal injury claims. ADR is generally voluntary.

Modes of ADR:

Arbitration:

Arbitration, a widely used form of ADR, is a kind of dispute resolution method that the disputes
arising between the parties are resolved by the arbitrators appointed by them instead of state's
legal bodies.

Mediation:

Mediation, a wide applicable form of ADR, is a method in which the mediator provides better
communication between the parties of the dispute. The mediator does not guide or direct the
parties, or gives an advice or gives a binding decision like an arbitrator or a judge. The mediator
only contents with asking directive questions to the parties' better communication with each
other.

Conciliation:

Conciliation is a form of ADR in which an objective third party provides different solution offers
which will take form according to the circumstances of the dispute and aims to provide the
parties to reach an agreement as per one of these offers after negotiations and deliberations.

In opposition to the mediation method, conciliation is based on right and rightfulness and the
history of the dispute is taken into consideration. At the same time, conciliation method is less
flexible than mediation method and is mostly based on provisions of law.

Negotiation:

Negotiation is a type of ADR which is generally referred to initially in case of a dispute and it
covers all methods of ADR. This type of ADR aims for the parties to settle the dispute between
the same by negotiating and deliberating with each other with the attendance of their attorneys if
needed, without intervention of any third party.
Negotiation is a kind of ADR method that each party tries to obtain a benefit for themselves at
the end of the process by persuading the other party to act in the way the former desires

Mediation Helps Businesses Resolve Conflicts Quickly and

Affordably

Mediation can save disputing parties time and money, which makes it an
increasingly popular and sometimes mandatory form of conflict
resolution for businesses and individuals involved in civil litigation. In a
mediation or settlement conference, a neutral negotiator tries to help
adversaries reach a mutually acceptable agreement.
In Bangladesh, Mediation would meet the need of corporate entities for a
speedy method to resolve Human Resource, Quality and Customer/
Supplier disputes. Mediation can also be used to settle conflicts between
shareholders and conflicts within the Board. It would also meet the needs
20 Bangladesh International Arbitration Centre (BIAC)
of the Telecommunication, Commodity, Real Estate,
Construction, RMG, Energy and the Banking
Industry.
At present, it is the Banks which need to clear their
bad debt cases accumulated in the formal legal
system but they have been slow to respond.
The greatest challenges in Bangladesh are the
mindset, resistance to change, and the fear of using
a new tool to resolve an old and difficult problem. The
infrastructure for using mediation in the Financial and
Commercial sectors is already in place.

Necessity of Alternative Dispute Resolution:

The ADR system is yet to be familiarized among the judges and lawyers and in particular
among the disputants and litigants in Bangladesh. The reasons, why disputants should consider
ADR, are described gives a wider range of settlement solution comparing with formal litigations;

1. Makes substantial contribution to a non efficient use of judicial resources;

2. Saves time and money both, of both the parties,
3. Saves judicial time, accelerating the disposal of and reducing the backlog of Cases;
 4. Preserves the trial courts statutory Authority and jurisdiction to try the case should ADR
fail
5. ADR is non-binding, the arbitrators or mediators take on the rate of investigator as well
as impartial judge;
6. ADR proceedings are confidential, and not Admissible At the litigation.

ADR procedure can support not only the legal objectives, but also support other development
objectives, such as economic and social objectives, by facilitating the resolution of disputes that
are impeding progress of these objectives.

Related Legislation:
Under section 28 of the Contract Act 1872, Every agreement, by which any party thereto is
restricted absolutely from enforcing his rights under or in respect of any contract, by the usual
legal proceedings in the ordinary tribunals, or which limits the time within which he may thus
enforce his rights, is void to that extent.

Exception 1.This section shall not render illegal a contract by which two or more persons agree
that any dispute which may arise between them in respect of any subject or class of subjects shall
be referred to arbitration, and that only the amount awarded in such arbitration shall be
recoverable in respect of the dispute so referred.

Exception 2.-Nor shall this section render illegal any contract in writing, by which two or more
persons agree to refer to arbitration any question between them which has already arisen, or
affect any provision of any law in force for the time being as to references to arbitration.

Under section 76 of the Bank companies Act 1991, (1) Notwithstanding anything contained in
any other Act for the time being in force, the High Court Division shall not sanction any
compromise or arrangement between a banking company and its creditors or any class of them or
between such company and its members or any class of them, or any amendment in such
compromise or arrangement, unless the Bangladesh Bank is of the opinion that the compromise,
arrangement or the amendments therein are capable of being worked out and are not detrimental
to the interests of the depositors of the banking company concerned.
(2) Where an application under section 230 of the Companies Act is made in respect of any
banking company or in respect of the conduct of any of its directors, the High Court Division
may direct the Bangladesh Bank to make an inquiry in relation to the affairs of the banking
company and the conduct of its directors; and when such a direction is given, the Bangladesh
Bank shall make such inquiry and submit its report to the High Court Division.
Conclusion:
Mediation may be particularly useful when parties have a relationship they want to preserve. So
when family members, neighbors, or business partners have a dispute, mediation may be the
ADR process to use. Mediation is also effective when emotions are getting in the way of
resolution. An effective mediator can hear the parties out and help them communicate with each
other in an effective and nondestructive manner.

On the other hand, mediation may not be effective if one of the parties is unwilling to cooperate
or compromise. Mediation also may not be effective if one of the parties has a significant
advantage in power over the other. Therefore, it may not be a good choice if the parties have a
history of abuse or victimization.