Oregon Construction Contractors (CCB) Practice Test

Which process is generally the first step in alternative dispute resolution (ADR)?

1. Mediation

2. Arbitration

3. Negotiation

4. Litigation

The correct answer is: Negotiation

Negotiation is typically recognized as the first step in the alternative dispute resolution (ADR) process. This approach involves the parties directly communicating to resolve their differences without involving third parties. The primary objective of negotiation is to reach a mutually acceptable agreement through discussion and compromise. This initial phase is crucial because it allows parties to explore their issues in a less formal setting, providing an opportunity to understand each other’s perspectives. It can pave the way for more structured forms of ADR, such as mediation or arbitration, if direct negotiations do not lead to a resolution. By starting with negotiation, parties can save time and resources, and often maintain a better working relationship moving forward. In contrast, mediation and arbitration are facilitated methods where third parties help to resolve the dispute after initial negotiations may have failed. Litigation is a more formal legal process typically utilized when other resolution methods have been exhausted or are deemed inappropriate. Thus, negotiation serves as the foundational step in the ADR framework, emphasizing direct communication and collaboration between the involved parties.