Alternative Dispute Resolution :In today’s fast-paced world, time is money — and when disputes arise, businesses and individuals need solutions that are quick, cost-effective, and results-driven. That’s where Alternative Dispute Resolution (ADR) comes in. With a strong legal framework under the Arbitration Act (1995) and the Civil Procedure Act, ADR is quickly becoming the go-to solution for modern businesses in Kenya. The following article highlights and takes you through the effectiveness of Alternative dispute resolution (ADR) system in Kenya

Abstract

Section 7(1)(I) of the legal aid 2016 mandate the National legal aid services (NLAS) to promote and facilitate the settlement of dispute through alternative dispute resolution (ADR). This is in accordance with article 159(2) (c) of the constitution of Kenya which provides that in exercising judicial authority , the courts and tribunals shall promote alternative forms of disputes resolution

Alternative Dispute Resolution typically denotes a wide range of dispute resolution processes and techniques that parties can use to settle dispute with the help of a third party. With this, Alternative Dispute Resolution system is increasingly being adopted as a tool to help settle disputes within the court system.

From this Alternative Dispute Resolution has gained widespread acceptance among both the general public and the legal profession in recent years. Back then 2008 some court required some parties to resort to Alternative Dispute Resolution form of resolution, by this Alternative Dispute Resolution method such as mediation was used to permit the parties.

The rising popularity of Alternative Dispute Resolution can be explained by the increasing caseload of traditional courts. The perception that Alternative Dispute Resolution imposes fewer cost than litigation, is a preference for confidentiality and the desire of some parties to have greater control over the selection of the individuals who will decide their dispute.

The tax procedure act NO 29 of 2015 (TPA) provides for an elaborate internal dispute resolution mechanism (IDRM). A tax dispute commences with an objection by the Taxpayer to a tax decision made by the commissioner or to an appealable decision as stipulated under the TPA 2015. This highlight some part of Alternative Dispute Resolution framework more is highlighted on ADR FRAMEWORK.

What is Alternative dispute resolution (ADR?)

Alternative dispute resolution (ADR) are methods for resolving conflicts outside of traditional court litigation including techniques like mediation, arbitration, negotiation etc. Alternative Dispute Resolution offers a faster, cheaper and more flexible parties to find amicable solutions. The Key Alternative Dispute Resolution methods involve a neutral third party to facilitate or decide on a resolution.

History of ADR

Alternative dispute resolution is one of many different available option for individuals to proceed through when setting a disagreement. Alternative dispute resolution is more of a collaborative approach to problem solving. It offers a way to more fully understand the viewpoint of the other party or parties involved in conflict or disagreement.

After gaining independence in 1963, Kenya maintained the formal legal system inherited from the British but traditional dispute resolution mechanisms remained prevalent especially in rural and community setting. Kenya legal framework continued to recognize the role of customary law particularly in matters of personal law such as marriage, divorce and inheritance.

Alternative Dispute Resolution in Kenya evolved from ancient community-based mechanisms and was marginalized during the colonial era by the formal common law system. The 2010 constitution then revived and institutionalized Alternative Dispute Resolution mandating counts to promote mediation, arbitration, reconciliation and traditional dispute resolution (TDR) methods leading to its integration within the formal judicial system through initiatives like court-annexed mediation.

Evolvement of Alternative Dispute Resolution.

In the modern era, there has been a growing recognition of the importance of Alternative Dispute Resolution in enhancing access to justice and alleviating the burden on formal courts. Several legal reforms have been undertaken to integrate Alternative Dispute Resolution into the formal legal system. Key milestones include the establishment of Alternative Dispute Resolution institutions, such as the Arbitration Act (1995, revised 2010), which provides a comprehensive framework for arbitration in Kenya, aligning with international standards. Efforts have also been made to formalize mediation and conciliation processes, with the Civil Procedure Act and the Civil Procedure Rules encouraging the use of mediation.

Judiciary initiatives, such as Court-Annexed Mediation (CAM), were introduced as a pilot program in the Family and Commercial Divisions of the High Court in 2016 and have since expanded to other court divisions. CAM mandates mediation for certain types of cases before they proceed to trial. The Mediation Accreditation Committee (MAC) was established to accredit mediators and ensure the quality and professionalism of mediation services.

The 2010 Constitution of Kenya explicitly recognizes and promotes the use of ADR mechanisms, including reconciliation, mediation, arbitration, and traditional dispute resolution mechanisms. Article 159(2) (c) emphasizes the promotion of Alternative Dispute Resolution as a means to enhance access to justice and reduce the backlog of cases in the judiciary.

Capacity building and public awareness efforts have been made, with various institutions, including the Judiciary Training Institute and private organizations, involved in training and accrediting Alternative Dispute Resolution practitioners. Public sensitization initiatives aim to raise awareness about the benefits of Alternative Dispute Resolution and how to access these services.

Current developments in the Kenyan judiciary include the expansion and modernization of Alternative Dispute Resolution programs, with ongoing efforts to integrate technology and enhance efficiency. Nairobi is positioning itself as a hub for international arbitration in the region, supported by the Nairobi Centre for International Arbitration (NCIA), established in 2013.

In summary, Alternative Dispute Resolution in Kenya has evolved from traditional community-based practices to a modern, integrated component of the formal legal system. This evolution reflects a commitment to enhancing access to justice, efficiency, and the effective resolution of disputes.

Common Alternative Dispute Resolution processes;

Alternative Dispute Resolution can be used to resolve many types of legal disputes over issues involving:

Business partnerships
Contracts
Debts, loans, and leases
Employment
Homeowners’ associations
And more

The most common ADR methods are negotiation, mediation, conciliation, arbitration, private judging and expert determination.

1.Negotiation

Negotiation is usually the first approach to take before resorting to other ADR methods. It is more informal and affords the parties flexibility. Essentially, negotiation is simply parties identifying an issue and meeting to fix it—they control the process and the solution.

This may seem obvious, as negotiating relationships and disagreements is something that business owners do all day, every day. However, when a problem gets serious enough, it can sometimes be helpful to recognize an informal negotiation as the first stage in a potential Alternative Dispute Resolution process.

One of the fundamental aspects of a successful negotiation is transparency. Personal or relational family tensions can cloud the negotiations. It is essential to be clear about the potential challenges and problems that might come up during the negotiations. Addressing the intense family tensions might feel overwhelming, but it will prevent you from feeling stuck during the process.

Legal Framework Supporting Negotiation

In Kenya, negotiation as an ADR mechanism is recognized under various laws, including:

Article 159(2)(c) of the Constitution of Kenya, 2010, which promotes ADR mechanisms including negotiation, mediation, and arbitration.
The Civil Procedure Act (Cap. 21), which allows courts to encourage parties to settle disputes amicably before proceeding with litigation.
Sector-specific regulations, such as those in tax disputes under the Tax Procedures Act and employment disputes under the Employment and Labour Relations Court Act.

Advantages of Negotiation in Alternative Dispute Resolution

Preserves business and personal relationships by fostering cooperation.
Reduces litigation backlog in Kenyan courts.
Provides faster resolutions, often within weeks rather than years.
Allows for creative, win-win solutions not bound by strict legal remedies.

Key Features:
- Flexible and cost-effective.
- No strict procedures; parties maintain full control.
- Common in business deals, employment disputes, and debt settlements.

2.Mediation

Mediation is a type of assisted negotiation. During mediation, parties obtain the help of a neutral third party (the mediator) to help them resolve the dispute. Importantly, mediation requires a lot of involvement from both sides.

Mediation can be informal, where the mediator is a friend, family member, or trusted advisor. In the case of an informal mediation, it is key to select a person who both parties can agree on and who brings some form of expertise to bear on the situation.

The process can also be formal, where the parties hire a professional, neutral third party. Formal mediators are trained in negotiations and help parties solve the issue to satisfy both sides. In either case, the purpose of a mediator is not to decide whether a party is wrong or right—the goal is to help the parties find a mutually acceptable resolution.

While conversations during mediation are confidential, it is usually possible for the written agreement that results from mediation to be made legally binding. Mediation is particularly useful if parties believe that they cannot resolve a dispute on their own.

Key Features:

Voluntary and confidential.
The mediator does not make a decision; the parties control the outcome.
Can be used for commercial disputes, family matters, or workplace conflicts.

Legal Basis in Kenya: Supported under the Civil Procedure Act (Cap. 21) and court-annexed mediation programs.

3.Conciliation

Conciliation, like mediation, is confidential, voluntary, and flexible. It is also facilitated by a neutral third party (a conciliator) and focused on reaching a dispute resolution that both parties consider satisfactory.

Unlike in mediation, the conciliator provides parties with a proposal to resolve the issue, and the parties work from there. The presented proposal is non-binding—although, like in mediation, any formal agreements struck after conciliation can be made legally binding.

Key Features:
- Less adversarial, encourages cooperation.
- The conciliator actively participates in finding a resolution.
- Often used in labor disputes and industrial relations.

4.Arbitration

Arbitration is more formal than negotiation, mediation, or conciliation, and can look more like litigation. Parties submit their dispute to an arbitrator who renders a decision following the process. Parties can agree to arbitrate before or after a conflict occurs.

The real benefit over formal litigation (in addition to cost and efficiency) is that the parties in an arbitration have the freedom to set the rules of arbitration, which can be much more flexible than formal civil procedure required in court. For example, parties can select the number of arbitrators, the forum, and fees.

Arbitrators also have a great deal of flexibility to work with the parties in front of them in a way even a judge may not. This type of process can help parties save time and expense associated with litigation.

Key Features:

More formal than mediation but less formal than court.
Arbitration awards are enforceable in court.
Often used in business contracts, construction disputes, and commercial disagreements.

Legal Basis in Kenya: Governed by the Arbitration Act, 1995.

5.Private Judging

In private judging, parties authorize an expert in their legal dispute to resolve the issue. The parties hire a private judge, often a former judge or an attorney. The parties take turns presenting their case to the judge, after which the judge issues a legally binding decision.

The court appoints a private judge. A private judge can help move the case along faster and enable parties to avoid airing their family business matters publicly.

6.Expert Determination

Definition: An independent expert in the subject matter evaluates the dispute and makes a determination.
Key Features:
- Common in technical disputes, such as engineering, IT, or accounting disagreements.
- Usually binding, depending on the agreement between parties.
- Faster and more specialized than traditional arbitration or court processes.

Benefits of ADR

Key advantages of alternative dispute resolution, including:

1. Faster resolution

The court system is overloaded. It cannot hold a trial for every lawsuit that gets filed. As a result, it can take several years for a legal case to go to trial. One of the benefits of Alternative Dispute Resolution is that resolution is fast. A settlement or arbitration award can be issued within a few weeks or months of filing a lawsuit.

2. Lower cost

Another one of the key advantages of alternative dispute resolution is that Alternative Dispute Resolution is usually a lot cheaper than a trial. Just the discovery process for going to trial can lead to an exorbitant total cost that includes court reporter fees, attorney fees, and the expenses associated with printing and mailing documents. More importantly, a long, drawn-out court trial can require jurors, witnesses, and the parties themselves to remain off of work for weeks. With Alternative Dispute Resolution, the process is shorter, and time is money.

3. More flexibility

The Alternative Dispute Resolution process is less rigid. Unlike a trial date that can vary because of the backlog, Alternative Dispute Resolution can be scheduled at any time. This not only provides greater flexibility but also helps speed up the resolution of the conflict.

4. Privacy

For the most part, court trials are public record and can be accessed by anyone. On the other hand, Alternative Dispute Resolution is not only private but also confidential. When an arbitration award is issued, or when both parties come to an amicable settlement through mediation, there is no public record of what transpired during the session. The amount of the award or settlement, the statements made, the list of participants, etc., all remain private. In summary, the public will have no idea when the Alternative Dispute Resolution took place and the eventual outcome. This level of privacy can be very beneficial for high-profile clients, as both parties are able to maintain their reputations.

5. No bias

A neutral third party is selected to preside over all cases that go through ADR. The neutral third party should have no connections to anyone involved in the lawsuit and no interest in the outcome of the dispute. In a court trial, the judge is not selected to preside. The judge is assigned. This difference is critical, as clients can select a neutral third party with specific subject-matter expertise to help facilitate or arrive at a well-informed resolution.

Example of Disputes appropriate for ADR

Disputes on which tax assessment has not been confirmed;
Disputes on which tax assessment has been confirmed but the parties mutually agree to a self-review;
Disputes before the Courts/ Tax Appeals Tribunal but where the parties desire an out-of-court settlement.

The following scenarios are the exception;

The settlement would be contrary to the Constitution, the Revenue Laws or any other enabling Laws.
The matter borders on technical interpretation of law.
It is in the public interest to have judicial clarification of the issue.
There are undisputed judgments and rulings.
A party is unwilling to engage in Alternative Dispute Resolution process.

FAQ; what are the ADR timelines?

90 days as provided for in Tax Procedure Act (TPA) section 55;
Court initiated Alternative Dispute Resolution? Dependent on court timelines granted

Conclusion on ADR in Kenya

Alternative Dispute Resolution (ADR) in Kenya has grown into a trusted, efficient, and cost-effective way of settling disputes outside traditional court systems. With support from laws such as the Arbitration Act, 1995 and the Civil Procedure Act (Cap. 21), as well as court-annexed mediation programs, ADR offers businesses, individuals, and organizations flexible options for resolving conflicts.

Whether through mediation, arbitration, negotiation, conciliation, or expert determination, ADR promotes faster resolutions, confidentiality, and preservation of relationships, making it ideal for both commercial and personal disputes.

As Kenya continues to embrace modern dispute resolution methods, ADR is expected to reduce case backlogs in courts and enhance access to justice, especially for small businesses and individuals seeking timely, affordable solutions. For the best outcomes, parties should seek guidance from qualified ADR experts or legal advisors to ensure their interests are well-protected throughout the process.

Final words

At Junyan & Associates, we understand that disputes can be disruptive — but they don’t have to drain your time, money, or peace of mind. Alternative Dispute Resolution (ADR) in Kenya offers businesses and individuals a smarter, faster, and more cost-effective way to resolve conflicts. Choose Junyan & Associates today in achieving peaceful, efficient, and results-driven dispute resolution.

Mastering Alternative dispute resolution (ADR)