Negotiation: This is a consensual bargaining process where parties attempt to reach an agreement jointly on a disputed matter or potentially disputed matter. In a negotiation, no third party is involved. Rather, parties are completely independent and make decisions independently too. Parties negotiate to reach a mutually satisfactory settlement. Unlike arbitration which excludes criminal proceedings, negotiation may take place in both civil and criminal proceedings.

Mediation: This also involves settlement of disputes through a third party. The third party is neutral and procured on the joint agreement of the parties and is called a “mediator”.  Impartiality and neutrality are the main attributes a mediator should possess. Mediation involves some negotiation too only that there is an inclusion of a third party in this case. It should be noted that although a third party helps the disputing parties to reach a decision, the parties are not obligated to follow the suggestions made. Other options may be explored. A mediator may decide to be formal or informal in his approach to guiding the parties in resolving their disputes. Where a mediator is formal, a basic structure both in procedure and discovery of documents may be employed to achieve the purpose of the mediation. Such procedure is not required where the mediation is informal. The mediation process is commenced without a necessary structure. Where parties reach a settlement by mediation, it is easier to enforce the decision reached because the mediator stands as a witness to the agreement/decision reached by the parties.

Conciliation: A neutral third party is also required in conciliation. The neutral third party basically communicates with the disputing parties and helps them work their way towards settlement of their dispute. The third party facilitates communication between the disputing parties. Conciliation is quite similar to mediation. In fact, some people interchange conciliation and mediation. In Nigeria, the Arbitration and Conciliation Act provides a structure for the efficient settlement of disputes by arbitration and conciliation. Part II of the Act pertains to Conciliation. Based on the provisions of the Act, conciliation in Nigeria takes the following process:

  • Party A who seeks to explore conciliation sends a written request to Party B to that effect. The request should also state the subject of the dispute between the parties.
  • Where Party B accepts, the conciliation proceedings are deemed to commence on the day of such acceptance.
  • After the acceptance, both parties then refer the dispute to a conciliation body who may be just one conciliator or three conciliators.
  • The conciliation body considers the case and hears both sides of the dispute.
  • After this, it may submit the terms of settlement of the dispute as it deems necessary.
  • The parties may or may not agree to the terms of settlement as submitted by the conciliation body. Where they agree, the Conciliation body draws up the terms and signs a record of the settlement. Where the parties do not agree to the terms of settlement, they may explore the option of arbitration if there’s any prior agreement to that effect; or they may take an action in court as they think proper.

Disadvantages of Alternative Dispute Resolution (ADR) MechanismsIn as much as there are advantages to choosing ADR mechanisms over traditional litigation, there are also certain disadvantages such as:

  • Parties have to pay for third parties that preside over or serve as links in the settlement process. The services of the third parties are not pro-bono.
  • A partial or biased third party may make circumstances worse for the parties. This may ultimately affect the decision reached by the parties if they are able to reach a decision at all.
  • As earlier mentioned, not every matter can be resolved by exploring certain ADR mechanisms. E.g. Arbitration cannot be used to resolve criminal issues.In conclusion, it should be noted that in certain cases, more than one option of Alternative Dispute Resolution may be explored. In other cases, two options may be combined. Hence, we may have options such as: Mediation-Arbitration, Negotiation-Mediation or Arbitration-Mediation. Parties may opt for any of these to address the peculiarities of each case.

Out-of-Court Settlement Accessed 2nd April, 2017.
A.O. Okoye, Law in Practice in Nigeria, 2nd Edition, Snaap Press Nigeria Ltd. 2015
Black’s law dictionary. 9th edition. Bryan A. Garner. 2009. Thomson Reuters U.S.
Arbitration and Conciliation Act, CAP A19 Laws of the Federation of Nigeria, 2004.