If you’re dealing with a commercial, business law, or real estate dispute, it’s natural to wonder whether mediation or arbitration might suit your case. These alternative dispute resolution (ADR) methods can provide faster, less expensive, and more flexible solutions than traditional litigation. Here’s what you need to know about qualifying for mediation or arbitration.
What Is Mediation?
Mediation is a process in which a neutral third party, called a mediator, helps two or more parties in a dispute reach a mutually agreeable solution. Unlike a judge or an arbitrator, the mediator does not have the authority to make decisions or impose a solution on the parties. Instead, the mediator facilitates communication, helping each party understand the other’s perspective.
Mediation aims to find a resolution that everyone involved can agree to, often through compromise or creative problem-solving. Mediation is typically voluntary, meaning the parties choose to participate and can withdraw at any time. It is common in business disputes because it allows for more tailored solutions to preserve relationships.
The mediation process is also usually confidential, so anything the parties discuss in mediation cannot be used in court if the dispute proceeds to litigation. Because mediation focuses on collaboration and finding win-win outcomes, the process is generally less adversarial and more flexible than going to court.
What Is Arbitration?
Arbitration is another ADR method where the parties agree to have one or more arbitrators decide how to resolve their conflict. Unlike in mediation, where the mediator only facilitates discussion, an arbitrator has the authority to make a binding decision on the dispute. This decision is called an “award” and is usually final, with limited grounds for appeal.
Arbitration can be voluntary or mandatory, depending on the agreement between the parties or the legal requirements at play. The process is more formal than mediation but generally less so than a court trial. Parties typically present evidence, call witnesses, and make legal arguments like in a court case. However, arbitration is often quicker and less expensive than litigation. It is common in commercial disputes and employment disagreements.
Like mediation, arbitration is usually private. The details of the case and the award are typically confidential, which is appealing to parties who wish to avoid public scrutiny. While arbitration offers the advantage of a quicker resolution, it can be a double-edged sword. This is because the parties usually give up their right to have a court of law decide on the case outcome.
When Could Mediation or Arbitration Be Right for Your Case?
Sometimes, a court might order parties to participate in mediation or arbitration, but these processes are usually voluntary. You might decide your case is suited to mediation or arbitration if the following criteria are present:
- Willingness to Negotiate: Both parties must be open to finding a resolution outside of court. If one side is unwilling to compromise, ADR might not be effective.
- Desire for Privacy: Unlike court proceedings, mediation and arbitration are typically confidential. If you want to protect sensitive information, ADR might be a suitable choice.
- Need for Speed: ADR processes are usually faster than litigation, which can be valuable for time-sensitive disputes.
- Cost Considerations: ADR often allows parties to save money. If you would prefer to avoid the expense of going to trial, mediation or arbitration could be the answer.
- Complexity: Some complex disputes involving highly technical or industry-specific matters could benefit from arbitrators with relevant experience.
- Desire for Ongoing Relationships: If parties wish to prioritize maintaining a working relationship, the privacy and flexibility of ADR can preserve those connections.
Contact a Business and Real Estate Lawyer Today
If you’re facing a legal dispute and considering if mediation or arbitration might be right for your case, contact Levy Goldenberg LLP today. Our experienced attorneys can evaluate your situation and help you make an informed decision.