Benefits of Alternative Dispute Resolution with Business Litigation Cases

When two businesses have a dispute, litigation is often the route that is chosen. While it’s true that this method is the one that many people are most familiar with, it isn’t the only option. Alternative dispute resolution (ADR) methods such as arbitration or mediation can be a better option in many cases. In this article, we will discuss the key things you need to know about ADR for business litigation cases. 

The Types of Alternative Dispute Resolution

Arbitration

Arbitration is a process in which two or more parties attempt to settle a dispute through the use of an impartial third party. The third-party, known as an arbitrator, hears both sides of the argument and then makes a decision based on the evidence presented. Unlike mediation, in which the parties attempt to reach an agreement themselves with the assistance of a mediator, the arbitrator makes the decision following an arbitration.  Arbitration can be binding or non-binding; if it is binding arbitration,  the decision of the arbitrator is final. 

While arbitration can be less expensive and time-consuming than going to court, it is important to remember that the arbitrator’s decision is not subject to appeal. As a result, arbitration should only be used when both parties are confident that they can work together cooperatively and reasonably.

Mediation

Business litigation cases often involve complex disputes that can be difficult to resolve. Mediation is a process that can help parties reach a mutually agreeable solution. 

In mediation, a neutral third party meets with the parties to the dispute and helps them to identify their goals and interests. The mediator then works with the parties to develop a settlement that meets their needs. While parties can voluntarily choose to mediate a dispute prior to the filing of a lawsuit, most courts in Florida now require parties to mediate disputes prior to trial.  

Neutral Evaluation

In business litigation cases, neutral evaluation is a process in which a neutral third party reviews the facts of the case and makes a nonbinding determination of how the case should be resolved. 

Neutral evaluation is typically conducted by a panel of experts who are familiar with the relevant industry or fields of law. The panel will hear from both sides and then render a decision that is nonbinding on the parties. This can be an effective way to save time and money, and it can also help to avoid the bad publicity that can often accompany litigation.

Negotiation

Many businesses choose to resort to litigation when they are unable to resolve a dispute internally. While this may be necessary in some cases, it is often possible to reach a resolution through negotiation. 

The benefits of negotiation include saving time and money, preserving relationships, and avoiding the stress of litigation. In addition, negotiation often leads to more creative solutions that are tailored to the needs of both parties. As a result, it is often in the best interests of both parties to attempt to negotiate a resolution before resorting to litigation.

Conciliation

Conciliation is an alternative dispute resolution method that can be used to resolve business disagreements without resorting to litigation. Conciliation involves bringing the parties together to discuss their differences and try to reach a mutually acceptable resolution. This process can be beneficial because it allows the parties to maintain control over the outcome of their dispute. 

When Is Alternative Dispute Resolution an Option for Business Litigation Cases?

In some cases, ADR may be mandatory, such as when two parties are required to mediate their dispute before going to trial. In other cases, it may be voluntary, and the parties may choose to use arbitration or negotiation to try to reach a resolution. 

Whether it is mandatory or voluntary, ADR can often save time and money, and it can be less stressful than going to court. It can also be more effective in resolving disputes since the parties have more control over the process and the ability to craft a resolution that meets their needs.

However, there are some cases where ADR is not the best option. For example, if one party is unwilling to compromise or there are complex legal issues at stake, ADR may not be able to provide a satisfactory resolution. In these situations, it may be necessary to litigate the case in court. Ultimately, whether to use ADR or go to court is a decision that should be made on a case-by-case basis after considering all relevant factors. 

When In Doubt, Contact a Business Litigation Lawyer

There are several options available when deciding how to handle business disputes and a lawyer will be able to help you decide which one is the best for you. 

Here at Avera Law, we have more than 70 years of experience with business dispute resolution in Gainesville, FL. Contact us today for a free consultation to learn more about our services and how they can benefit your business.