Is mediation or arbitration a better method to resolve my business dispute?
Conflict is a given in the business world. Business owners can take steps to avoid disputes by creating solid contracts and partnership agreements, but eventually, nearly all business owners will run into some type of dispute. Common disputes involve business partners and business vendors. When a dispute arises, business owners will usually first attempt to resolve the issue without judicial intervention. Mediation can offer an inexpensive way to reach an agreement that both parties will accept. Where mediation fails, arbitration or litigation may become necessary.
Benefits of Mediation
Business mediation is the process by which the disputing parties and their business dispute attorneys will attempt to reach a settlement agreement. The parties may employ a third party mediator to facilitate settlement discussions. The mediation process could take some time and requires that the disputing parties enter with an attitude amenable to resolution.
There are several potential benefits of mediation, including:
- Cost savings
- Control over the outcome of the dispute
- Potentially preserving your business relationship
- Privacy and confidentiality
Business litigation can come at some cost. Court fees and attorney’s fees may mount considerably in a protracted business litigation case. Further, the outcome of the case will depend entirely on the judge or jury. Similarly, arbitration is costlier than mediation. The arbitrator is entrusted with making an ultimate decision on the dispute, removing control from the hands of the warring parties. As such, mediation, when possible, is often the most efficient and cost-effective means of resolving a dispute.
When Mediation Fails
The vast majority of all business mediations will successfully result in a settlement. In some situations, however, the parties are unable to reach an agreement through mediation. At that point, the parties have two main options: arbitration or litigation. Arbitration is the process in which the dispute is submitted to an impartial individual who will issue a final and binding decision. Litigation, on the other hand, involves arguing the matter in court. Your business dispute attorney will review the facts of your dispute to determine your best course of action. With your business attorney’s assistance, you can swiftly resolve your business dispute so that you can move forward with operating your successful business.