In this article, we discuss the current state of Alternative Dispute Resolution (‘ADR’) law, practice and education in South Africa, with a particular focus on the potential role for mediation in commercial disputes. Our angle is to frame the material with a discussion of economic and contract theory, particularly that on private ordering and relational contracting. We link this socio-legal theory to more specific theory on ADR itself, and then contextualise ADR in South Africa. We discuss the role of ADR in commercial practice generally and provide a detailed account of the South African construction industry specifically. Our major conclusion is that ADR is often the most appropriate form of dispute resolution, particularly where social capital is at stake. This provides the link between ADR theory and private ordering/relational theory. Another important conclusion is that South Africa needs more specialist mediators, as well as a legal and political environment which incentivises such training.