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What are alternate dispute resolution methods?

On Behalf of | Feb 1, 2021 | business litigation

When handling a business dispute, note that not all disputes must progress to litigation. In fact, you could solve yours without ever having to set foot in a court room.

First, you must ask yourself some questions. What are the alternative methods you can use if you want to avoid litigation? Which situations do they work best for, and how can you tell?

How arbitration works

FINRA discusses two of the most popular alternative dispute resolution methods. Each offers its own potential benefits. Arbitration is the option closest to litigation. In this scenario, an arbitrator takes the role a judge normally would. They listen to all sides present their arguments. Then, they make a legally binding decision that all parties must follow. The main benefit is that it allows you the structure of litigation without having to take your case to court. You can save money and time this way.

Mediation compared to arbitration

Mediation is the second option. It works best if your dispute is not too vitriolic. It relies on the parties being able to work out the bulk of their arguments on their own. Unlike an arbitrator, a mediator does not hold the legal power necessary to make a binding decision on your behalf. Instead, they provide guidance and suggestions. They act as referee when necessary. They also ensure that every party gets a chance to have their perspective heard.

There are some cases in which litigation ends up being the best possible option. But until you confirm this, you have other options open and available to you that you can consider.