Is mediation the best approach to resolve your conflict? There are advantages and disadvantages with mediation, arbitration and litigation.
Here’s what you need to know.
- With Mediation, a neutral 3rd party (your mediator) is working with both parties to find an acceptable resolution to the conflict. Once you come to an agreement, the mediator will put your new understanding in writing and create a contract that you must sign before it would be legally enforceable. Mediation is designed to be a win/win. If you feel like you need to “strong-arm” your adversary, mediation is not a good fit for you.
- With Arbitration, your case is presented to a neutral 3rd party (your arbitrator). Many contracts call for arbitration to avoid litigation. The arbitrator issues a binding legal judgment … deciding against one of the parties. It’s important that your case be formally prepared as if you were going to trial so that the arbitrator is well informed. If you would like to maintain your options, arbitration is not a good fit for you. The arbitrator’s decision, generally speaking, is final.
- With Litigation, the parties engage attorneys to represent them in court. The judge assigned to the case evaluates the law as it applies to your case and makes a final judgment. Litigation is typically extremely expensive and time-consuming. Working with an attorney will often require a sizeable retainer … making it quite costly just to get the process started. If cost is not a consideration AND your contract doesn’t require mediation or arbitration, you may feel like you are better served by “letting a judge decide.”
Dr. Gala Gorman is a CPA with over 35 years of experiencing advising business owners of closely held companies. She has reviewed 100s of contracts helping the parties ensure that their interests are protected. If you have a conflict that involves a closely held business including a dispute between partners or spouses, Dr. Gala offers an initial consultation to discuss the circumstances of your conflict. You can schedule an appointment at WinWinWinMediation.com/Contact-Us/.