Commercial litigation can be a long and tiresome process for many companies who simply wish to focus their time and attention on their business and deal with disputes quickly and efficiently.
No one wants elongated and costly court proceedings to make a problematic dispute all the more problematic. We know this better than most at Dettmann Phair Lawyers. As a leading commercial litigation firm, we know how costly it can be to stretch out negotiations and disputes in the courtroom.
Every case is admittedly a little different. However, not enough time or focus is placed on the utility of effective mediation tactics or even replacing the litigation process using effective arbitration. These solutions reduce unnecessary costs for both parties. They get to the heart of the matter without the hassle of courtroom dates and elongated evidentiary stipulations and obligations.
Today, we’re going to talk a little bit about arbitration and mediation and why in some cases, it trumps the commercial litigious route for disputes.
Arbitration & Mediation
While they have a lot of overlap in their utility and overall processing, there are some subtle but key differences between the execution and ramifications of arbitrations and mediations. With that in mind, it is best to define them accordingly.
Mediation is the first step in the legal process because it can prevent a case from going to court. Parties involved in mediation engage in a negotiation process to settle a dispute observed and facilitated by an objective third party.
This third party, known as the mediator, assists parties in identifying key issues, opening dialogues, and navigating discussion points between parties to facilitate a potential resolution of a dispute. During mediation, disputing parties split up, with the mediator moving between the parties and speaking back and forth.
The ideal goal for a mediator is to provide intuitive solutions for the dispute that will necessitate a lengthy court process. The more relaxed approach that usually dictates mediation proceedings allows for more approachability in the negotiation processes.
Mediation usually takes place over a much shorter time period, is less expensive than arbitration and litigation, and mediators can offer less monetarily based solutions for disputes that are not always considered in a courtroom or arbitration setting.
Arbitration is a little more official and legally binding than mediation, even though a majority of the same principles are in effect. One of the main points of difference is in the third party – in place of a mediator, the third party is an official adjudicator capable of making legally binding decisions based on the evidence presented to them.
Arbitration has more similarities to traditional litigation, with the focal difference being that the process takes place out of court and is in more of a private setting than an open courtroom. Arbitrators make legally binding decisions that are often chosen and agreed to by both parties before the start of proceedings.
An arbitrator’s decision can be registered with the court and have the same authority as an official court decision made in litigation.
How Either Can Facilitate A Smoother Case
Avoiding long and drawn-out court processes is certainly the optimal route for any person and company dealing with commercial disputes. Both alternatives offer some distinct advantages over the courtroom in terms of length, expense, and publicity. While mediation is a faster alternative, it is not binding but has the advantage that any solution is by agreement between the parties. The decision in arbitration is not by agreement but is binding on both parties and has the advantage of bringing a complex matter to a fast conclusion.
Having an objective third-party look at the entire situation and facilitating a conversation between both parties works best for all involved.
Arbitration and mediation are effective and inexpensive alternatives to commercial litigation cases. Disputes that can be talked through without the necessity for a court case are less likely to cause long delays and allow businesses to get back to work.