“Adoption of Alternative Dispute Resolution (ADR) for Resolving Commercial Disputes in Bangladesh”

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Rahman & Rabbi Legal

If we consider our present legal practice in Bangladesh, we will see lots of cases are pending before the courts. For this reason, it takes plenty of time to dispose a suit through the present judicial system. Unfortunately, parties who are now involved in this eccentric process of judicial system are completely frustrated for delay and lengthy proceedings. On the other hand, ADR process is advantageous and effective process than court system in the sense that it helps to save time of the parties and also reduce the cost and burden of the court proceedings. Moreover, the parties are at win-win position in the process of ADR and relation between the parties does not get worse. Hence, I believe that this global best practice has a future in our country.

The primary obstacle we are facing now in our country is the lawyers’ attitude towards ADR. Lawyers believe that, in case the dispute between the parties resolved through ADR, they shall lose the opportunity to earn more money through congested court proceedings. Specific amount of money which lawyers are usually getting from the ADR process may not meet the demand of them. Consequently, it is also true that, the mediator or arbitrator may not know the applicable and related laws or having lack of adequate knowledge for which the parties sometimes cannot put their faith upon the mediator or arbitrator. Another issue which is common in Bangladesh, most of the parties are think that, mediator or arbitrator could be biased and could provide the award in unfair manner.

One of the motives why parties especially corporate are interested in ADR is the confidentiality. Generally it is the norm that, individuals who are related with an ADR process always maintain confidentiality of the subject matter of the proceedings. This is the reason why, in the ADR proceedings, parties could deliver any reasonable submission without diffidence to dissolve any disputed matter. However, the court proceedings may not always maintain confidentiality; therefore, corporate parties especially suffer from reputation risk which may damage their good will in the business world. In the corporate world, reputation adds value in the market and hampering that reputation through a dispute is completely undesirable for corporate parties.

We are generally in favor of insertion of ADR clause in all commercial contracts. However, it should be directory to put an ADR clause in the commercial contracts so that whenever a dispute arises, parties can attempt for an amicable settlement first. Commercial contracts are very sensitive and crucial in nature because of the involvement of financial investments. If any dispute solved through the judgment of the court, then only one party will win the suit however if the problem settled in ADR then both parties will be at win-win position. Moreover, ADR reduces the chances of hostility between parties and in case the dispute is settled at the first step then it saves the parties and court from huge consummation of time.

ADR process is an optional additional tool for dispute resolution. It is not another layer of proceeding or unnecessary diversion because ADR helps to remove undue number of phases of court proceedings in a cost effective manner. However, I think, it has become a fantasy now to determine a dispute through court proceedings in a rapid manner. The proceedings of courts are becoming so lengthy and time consuming for having plenty of suits that till reaching into the conclusion of litigation, the sole purpose of the litigation may be frustrated. This is the primary reason; parties related to the dispute are indifferent to come in purview of the court proceedings. Hence they tend to choose ADR to conduct the dispute resolution process beyond the court proceedings.

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