When doing business, there ought to arise many disputes and many business people may opt to resolve these disputes in court while others opt for outside court settlement commonly known as alternative dispute resolution. Cases that are resolved through the court system undergo numerous legal phases and this ends up costing a lot of money in expenses and fees as well as time (Kubasek and Browne, 2016). When individuals decide to settle cases out of court they are required to engage in alternative methods of dispute resolution such as mediation, arbitration, evaluation among others, depending on the weight of the case.
An example of a common business dispute is where a local graphic designer decides to sue an organization for refusing to pay him after asking him to re-design T-shirts for the company. The company defends itself by claiming that the T-shirts were delivered late and their quality was way below the standard of the company and so according to them the designer broke the contract and therefore no payment was due. The amount that was supposed to be paid for re-printing the T-shirts was $3000 and the two parties decided to take the matter to court and present both their sides of the story. Both parties introduced evidence and thereafter gave their testimonies and later appeared individually with no lawyer to represent either of them. The designer went ahead to produce written contracts, a nice sample of the re-printed newsletter and he even went further to produce a letter from an expert which stated that the T-shirts were according to the company standards. The designer also presented to the court that the delay in delivering the T-shirts was due to the fact that the company asked for changes and alterations that were time-consuming, and, therefore, the order took a bit longer than expected.
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In their defense, the company presented that the work was crucially late to be delivered to the extent that it breached the terms of the contract and that the client did not get the correct color or quality for the orders. They also produced a letter that they had sent to the designer pointing out the delay of the project and asking for the work to be completed immediately.
This case has been going on for 5 months and is yet to be ruled. As we can see both parties have spent a lot of money going from expert to expert and a lot of time and energy going to court to present their testimonies time which they would have used to expand either of their businesses or doing something else that might have been constructive for them both.
These two parties would have been in a better place right now had they resorted to engaging in an out-of-court dispute resolution. This method also known as, Alternative Dispute Resolution (ADR), is more favorable now even in court and it is being preferred as an alternative to the infamous traditional forms of litigation. The reason is that litigation can be time consuming and complicated thus parties involved can always find this method useful to them (Stipanowich and Lamare, 2013).
The recommendation for the case above, the two parties should have opted for mediation as an out-of-court resolution to the dispute they were having. Mediation could have possibly saved them time and helped them preserve the relationship that they had with each other and also ensure that they could do business together in the future. This method would see them get a mediator who would listen to both sides and advise them accordingly to reach a solution and thereafter decide whether or not to continue with the business relationship. The mediator would help them to reach a solution by making them brainstorm through new ideas that would help them forge ahead. The mediator would question the two parties regarding the interests, strengths, facts and weaknesses of both their cases. They would also help them explore non-monetary settlement options for continuation of their business relationship. There would also be an offer of conditional demands and options. The best alternative would be offered for the negotiated settlement. The mediator would then ask both parties to offer apologies and put down in paper the appropriate time of the negotiated payments.
The main objective of mediation is for both parties to reach an agreement concerning a dispute. In the case, it is not too late for the two parties above because they can decide to settle the law suit even in the case of litigation. The settlement terms will be principally agreed to at the mediation table. The lawyers will prepare the actual settlement agreement after the process of mediation is completed.
Rubinson (2016) says that as compared to traditional methods of litigation mediation has its advantages since it only takes a few days or maybe weeks in cases that are very complex whereas lawsuits take years or many months as in the case above. Mediation allows people to get back to their lives in good timing. Secondly, mediation is less expensive than a typical lawsuit because employing a mediator costs significantly way less than employing a lawyer whom you one ends up paying a lot of money over a long period of time. According to Moore (2014), when individuals opt for mediation sometimes there are non-profit mediation firms that offer mediation services for free and therefore the two parties will have to spend no money at all (Rubinson, 2016). More so mediations are more confidential as compared to court cases which mean there are no records or fingerprints taken in court and no evidence is introduced during mediation. They cannot be used at a later date; this means the evidence cannot be revealed. Lastly, in mediation both parties have greater control of the process and this means that they have a say in the negations or settlements over the outcomes.
In conclusion ADR is a much better way to settle disputes as compared to taking cases to the court. This helps save time, money, and energy. It also helps preserve relationships, save parties their relationships, and eliminate possible negative publicity by engaging in court activities. Also, through this the parties can avoid negative criticism and judgment from the general public.
References
Kubasek, N. K., Brennan, B. A., & Browne, M. N. (2016). The legal environment of business: A critical thinking approach . Pearson.
Moore, C. W. (2014). The mediation process: Practical strategies for resolving conflict . John Wiley & Sons.
Park, W. W. (2012). Arbitration of international business disputes: studies in law and practice . OUP Oxford.
Rubinson, R. (2016). Mediation models and comparative dispute resolution: of grids and gatekeepers: the socioeconomics of mediation. Cardozo j. conflict resol. , 17 , 873-1071.
Stipanowich, T., & Lamare, J. R. (2013). Living with'ADR': Evolving Perceptions and Use of Mediation, Arbitration and Conflict Management in Fortune 1,000 Corporations. Arbitration and Conflict Management in Fortune , 1 .
