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Alternative Dispute Resolution

Alternative Dispute Resolution (ADR) in Malaysia refers to methods of resolving disputes outside of traditional court litigation. ADR provides parties with more flexible, cost-effective, and time-efficient ways to resolve conflicts

Main forms of adr in Malaysia

  1. Mediation: Mediation involves a neutral third party, the mediator, who facilitates communication and negotiation between the disputing parties. The mediator helps them reach a mutually acceptable resolution. Mediation is voluntary, non-binding, and confidential. It is commonly used in civil and commercial disputes.
  2. Arbitration: Arbitration is a formal process where the disputing parties present their cases before an impartial third party, the arbitrator or a panel of arbitrators. The arbitrator’s decision, known as the award, is binding on the parties. Arbitration is widely used for commercial and international disputes and is governed by the Arbitration Act 2005.
  3. Adjudication: Adjudication is commonly used in the construction industry to resolve payment disputes quickly. The Adjudication Act 2012 provides a statutory framework for the process. An independent adjudicator reviews the evidence and makes a provisional decision that is binding on a temporary basis until a final resolution is achieved.
  4. Negotiation: Negotiation is an informal process where parties directly communicate to find a resolution. It is often the first step in ADR and can be used in various types of disputes. Negotiations can be facilitated by lawyers or other professionals, but the parties retain control over the outcome.
  5. Collaborative Law: In collaborative law, both parties and their lawyers commit to resolving the dispute through cooperation and negotiation. If the collaborative process fails, the lawyers must withdraw from the case, encouraging a genuine effort to reach an agreement.
  6. Court-Annexed Mediation and Settlement Conferences: The Malaysian courts encourage parties to participate in mediation and settlement conferences as part of the court process. These methods allow parties to explore potential resolutions before proceeding to trial.

Advantages of adr in malaysia

  • ADR is generally faster and more cost-effective than traditional court litigation.
  • Parties have more control over the process and outcome.
  • ADR proceedings are often less formal, creating a more comfortable environment for parties.
  • Confidentiality is usually maintained, protecting sensitive business information and relationships.

Overall, ADR in Malaysia provides a viable alternative to court litigation for resolving disputes in a more efficient and collaborative manner. It is essential for parties to consider the nature of their dispute and the most suitable ADR method that best suits their needs.

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