Business Dispute Resolution
Business disputes are inevitable for a majority of businesses because of the many transactions businesses rely on to continue operating. Business disputes can arise when you are establishing a company, when entering into contracts, or when your company is winding up. A number of companies tend to go to the courts to resolve their disputes with other businesses. But such disputes can also be resolved using alternative dispute resolution methods, which do not involve judges and/or jury presiding over the issue.
What Is Alternative Dispute Resolution?
Alternative dispute resolution is any method of solving disputes without litigation. Once you have solved your dispute through ADR, you can ask a court to review the resolution reached. Courts are more likely to approve ADR decisions and awards than overturn them. The court approves the following ADR methods:
- Negotiation: Disputing businesses can decide to negotiate between themselves or hire attorneys to help them negotiate a fair deal.
- Mediation: A neutral party (mediator) facilitates communication between two disputing parties to help them reach a mutually acceptable agreement. The mediator does not force an agreement or make any decision for the disputing parties. The mediator helps them think out of the box.
- Arbitration: An impartial third party called an arbitrator hears from both parties and makes a decision based on the facts and applicable law. Since only one party prevails in arbitration, the other party is likely and allowed to appeal.
What Are The Benefits Of ADR
Some of the benefits of arbitration include the following:
- Parties negotiating have more control of the negotiations which allows them to establish rules regarding discovery, hearings, time limitations and other matters
- Arbitration cases take lesser time compared to cases that go to trial
- ADR costs are lower for lawyer fee’s compared to trial cases because they take less time to resolve
- The attendance and proceeding of ADRs are strictly confidential but litigation occurs in public
- Disputing parties can choose an arbitrator mediator that has expertise and experience with the subject matter
Causes Of Business Disputes
Business disputes are barriers to the success of a business. Knowing how these disputes may arise can help you prevent them. You are very likely to face conflicts involving breach of contract if you rely on suppliers, contractors, purchasers and other business transactions. These conflicts often occur when a party does not receive the product or service that the party believes they are entitled to, or does not receive the service or product within the time stipulated in the contract. A party may also complain if the service or product they purchased was not up to the standard they expected.
A business may also enter into a conflict with employees because of discrimination, salary expectations, or unfair termination. These kinds of disputes can interfere with business operations because they often involve government employment agencies. There are also customer related disputes and disputes with shareholders. You can prevent most of these disputes by always insisting on written contracts that have been reviewed by your business litigation lawyer.