July 16, 2020 Last updated May 14th, 2022 1,045 Reads share

Are There Alternatives to Going to Court to Resolve a Business Dispute?

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If you have a conflict with a business partner, investor, or employee, you have probably considered filing a lawsuit. However, lawsuits are time-consuming and can even result in bad publicity for your company.

Fortunately, business disputes can normally be resolved with the assistance of a qualified attorney. An attorney can negotiate on your behalf and handle contracts, agreements, and other necessary paperwork for you.

There are four basic types of alternative dispute resolutions, they include mediation, neutral evaluation, arbitration, and settlement conferences.  It is helpful to understand a bit about each ADA, so you can select the one that is right for you.

Mediation

When two parties who have a disagreement with each other cannot reach a solution on their own, they will hire a mediator to assist them. The mediator will act as an objective third party in a negotiation.

The mediator does not make any judgments of their own but aids the two parties in communicating with one another. The parties involved in the dispute must decide on the outcome.

Mediation is normally used in a situation where the parties involved are going to continue to do business together after the issue has been resolved. Business partners will use mediation in a situation when an issue is impeding the process of getting work done. It is only effective in situations in which both parties are willing to compromise.

Neutral Evaluation

If you choose to employ the method of neutral evaluation to solve a business dispute, you should hire an evaluator who is an expert in the subject matter of your conflict.

In neutral evaluation, each person involved in a dispute will present their side of the case to an evaluator. The evaluator will give an objective opinion of the merits of each person’s case. Their opinions are not in any way legally binding. Businesses tend to use this form of negotiation when their dispute involves the opinion of an expert in technology or science. For example, a company may say an ex-employee has openly discussed the company’s method of manufacturing a product with their new company, violating a confidentiality agreement. The employee may say that method was not patented and that there was nothing unique about it.

Arbitration

During an arbitration, an objective third party known as an arbitrator is presented with evidence and listens to arguments from both sides. They will make a decision as to who is right in the dispute.

Many companies insist that their employees sign arbitration agreements. Arbitration agreements can be binding or non-binding. If an arbitration agreement is binding, then anyone who signs it is agreeing to abide by the decision of the arbitrator. An employee gives up their right to sue in this case.

In a non-binding agreement, both parties agree to go before an arbitrator and try to resolve the problem before going to court. If an employee does not agree with an arbitrator, they can still sue.

Settlement Conferences

A settlement conference is like a more formal version of mediation. The disputing parties will meet with either a settlement officer or a judge. Like a mediator, the judge or settlement officer does not make a formal judgment. Instead, they will offer their opinion of the merits of the case and help them to reach an agreement that is legal.

There are some situations where settlement conferences are mandated by the court. They are generally only mandated when one party has sued the other one and a judge wants them to try and work things out before going to trial.

It is very important to hire a lawyer to represent you no matter what form of ADR you use—someone like Orlando business lawyer Rahul Parikh. Business law is complex and you need a trained representative to get you a deal with which you can live.

Authoritative Sources:

https://www.myfloridacfo.com/division/consumers/mediation/

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J Ritvars

J Ritvars

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