Choose the right method to resolve business disputes
Whether it is a small company or a large corporation, disputes are common. It may be a minor matter or a major one, but any disagreement can sap money out and take focus away from daily operations.
When it comes to resolving disputes, there are numerous methods. Depending on the situation, one may be a better choice for both sides.
The Harvard Law School Program on Negotiation states that litigation is the best-known resolution technique. This type typically takes place in the court room and involves a plaintiff and defendant. The attorneys of each side present information, evidence and arguments to a judge, a jury or both. Although some cases involve a long-drawn-out court battle, many parties agree on a settlement. All information presented, as well as the verdict, is available to the public.
Court litigation is usually expensive and time-consuming, which is why many companies choose an alternative method to resolving disputes. One popular method is mediation. This involves a third-party mediator that plays a neutral role in helping both sides come to an agreement. A mediator has conflict-resolution skills and is able to offer creative solutions. The agreement is non-binding, voluntary and confidential.
Another alternative is arbitration. According to the American Bar Association, this method is a mix of both litigation and mediation. Similar to mediation, arbitration uses a third-party arbitrator, is more informal and is a faster process than litigation.
Arbitration is similar to litigation in that both sides present evidence to the arbitrator who, like a judge, makes a decision based on the facts. The decision may be binding or non-binding.