Many successful companies become embroiled in a dispute at some point. Contract disputes, employment issues and real estate matters are a few common business disagreements.
Regrettably, when involved in a dispute, you may become overwhelmed by the complexities. The worst part may be that dealing with litigation takes you away from conducting business, which impacts your company and your bottom line. Fortunately, when you are facing a business dispute, you do have options.
Mediation
One type of alternative dispute resolution is mediation. You may feel fairly comfortable with the process because it resembles other business negotiations. In mediation, there is a neutral third party who is typically an experienced court-certified mediator. The mediator establishes ground rules and listens to both sides. Each party may offer evidence and suggest acceptable solutions. The negotiations may continue with proposals and counterproposals until you reach an agreement. The mediator can then formalize the details for signing by both parties. If you cannot reach an agreement, you halt negotiations and proceed to another resolution method.
Arbitration
Arbitration also involves a neutral third party. However, unlike mediation, the final ruling is out of your hands. Arbitration is more like a court hearing than a negotiation. You make opening statements, present evidence, produce witnesses and appeal to the arbitrator to rule in your favor. Once you and the opposing party have completed your presentations, the arbitrator makes the final determination. In binding arbitration, that decision has the power of a court ruling. In nonbinding arbitration, you may agree to abide by the arbitrator’s decision or proceed with formal litigation.
Litigation
Many firms try to avoid litigation because it can be lengthy and expensive. The public nature of court battles can also cast your business in a negative light. However, since some disputes do end up in court, do not fear litigation: Prepare for it. Gather the information you need and understand how the law applies to your situation. With the proper courtroom strategy, litigation can have a positive outcome.
