Business enterprises are usually entangled in cases that require them to make decisions on whether to have out of court settlement or engage in litigation processes ( Huberman, 2017) . The case of Solar Company and the media company XYZ serves as an example of such instances. The nature of the case in question elicits a mixed reaction when making a decision on the avenue to follow when solving it. However, I would advocate for an out of court settlement involving arbitration instead of a litigation process.
In support of arbitration
In light of the case presented, adopting an arbitration process would suit Solar Company to a large extent noting that arbitration processes are usually easy to speed up. Solar company has already had its image tarnish even before the contract with XYZ media with allegations of employee harassment, supplying defective solar panels, and poor working conditions. The entry of the XYZ case is only acting to aggravate the matters making it necessary to have the cases resolved as a matter of urgency. Most notably, engaging in a litigation process will prove detrimental to the Solar Company given that unlike in the arbitration process, the company cannot influence how quick the issues will be saved.
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The issue of cost cannot go unnoticed in this case ( Huberman, 2017) . It is worth noting that XYZ media had fulfilled its part of the contract successfully for the first month and therefore Solar Company is liable to make payments to XYZ and the claim which Solar Company is making that the upfront payment should be refunded may not be granted in case a litigation process is followed. Moreover, charges for contracting a legal counsel will apply adding to the expenses that the company will undergo. If the company chooses to engage in arbitration, such expenses may not be incurred.
Litigation processes are made public given that they happen in a courtroom and are very formal (Berg, 2017) . The formality of the process makes it a requirement that Solar Company will have to make responses to some of the claims that were previously made. Additionally, having the process proceed in public will act to aggravate the situation noting that the company is already suffering from negative public relations.
In an arbitration process, parties to the dispute are entitled to have a voice in the choice of an arbiter and the eventual decision maker. The fact that both parties will have a say renders the project flexible given that they will both be involved in the choice and can express fears and reservations for proposing or objecting to certain arbiters. As a matter of fact, engaging in litigation will render both XYZ and Solar Company unable to make decisions on the jury presiding over their case and ultimately the final decision. Both companies may have to incur extra costs to cover for the case proceedings.
Often judges preside over cases that are of a general nature and not specific to certain industries. Subsequently, the litigation process will not be the best option noting that there can be arbiters who have expertise in cases of the Solar Company and XYZ media’s nature. It will be possible for the aggrieved parties to engage a third party preferably from the same industry noting that industry-specific knowledge may be integral in this case. Additionally, the arbitration case will provide a final and binding solution unlike in litigation where a party that is not satisfied with the judgment can engage in an appeal (Berg, 2017) . Engaging in appeals will only work to increase the expenses and further present Solar Company in bad light affecting its already damaged public image.
Advice to XYZ media’s CEO
The advice to the XYZ media’s CEO would be similar to that given to the Solar Company management. Such advice would be grounded in the fact that the media company will incur costs of hiring legal counsels and they may end up losing the case noting that the media company ought to have put up security measures to ensure that its systems are secure for the interest of clients and the media company (Troum & Bloomberg, 2014) . Losing in the litigation process would narrow down to the company paying damages to Solar Company and affecting future business prospects with not only Solar Company but other potential clients.
Memorandum
To: Solar Company CEO Employees, Clients, and Subcontractors
Cc: Employees, Clients, and Subcontractors
From: Legal Team
Date: 14/12/2018
Re: Use of Arbitration Agreements
Notice is hereby given that Solar Company will henceforth engage in arbitration in all disputes involving clients, employees, and subcontractors. The decision is advised by the costs of litigation and the need to protect the company image as well as improve its public relations. The company is setting up an arbitration procedure to ensure uniformity in dispute resolution.
Aggrieved parties will be required to write to the company’s legal team stating the arbitration’s subject matter noting the basic facts about the controversial issue. Upon receiving the written complaint, the parties will be called upon to choose their arbiters who in turn will choose a neutral party to preside over the process. Submission to arbitration will give the process a go ahead making a decision that will be final and binding between the disputing parties.
Congruent to the Federal Arbitration Act, the decisions and awards of the arbitration process will be confirmed by a court of law within one year of the award rendering it enforceable. In instances where one party is dissatisfied with the awards given in the arbitration process, a provision is made that the party can challenge the award within three months of the award. Most notably, an award may be nullified by the court of law in cases where contractual provisions such as duress and unconscionability are proven. Therefore upon confirmation of the award by a court of law, the award will become enforceable to federal judicial authority. To ensure the award is enforceable by a judicial authority it will be required that the party applying for the award presents a certified copy of the original award from the legal department at Solar Company and an arbitration agreement.
The legal department requests unlimited support to ensure that the new developments are followed. As noted earlier, the developments are aimed at bringing down the costs of litigation as well as ensuring that the company image and public relations are improved.
References
Huberman, M. J. (2017). A Practitioner's Guide to Commercial Arbitration . Toronto: Irwin Law.
In Berg, A. J. (2017). Yearbook commercial arbitration 2016: Vol. XLI .
Troum, N., & Bloomberg BNA. (2014). Federal Arbitration Act .
