Should your business use alternative dispute resolution (ADR) to avoid actual court cases? ADR, including mediation and arbitration, is often cited as a good way to avoid the expense of going to court. But it has other benefits for small companies, including nonfinancial benefits. What are some of these and how can they help your company? Here are a few reasons to consider this approach.
1. Disputes Remain More Private
A court case is a matter of public record. And this doesn’t just involve the actual time spent in front of a judge arguing your case, but it also involves a potential myriad of documents and discoveries leading up to the time in court. Alternative dispute resolution is a voluntary process that takes place before the case reaches this public level of scrutiny. Matters settled out of court this way are generally not made public.
2. You Maintain Business Relationships
Legal matters can be relatively mundane, but they’re often contentious by the time they involve going to court to sue a business or customer. That contentiousness often means that no matter whether the final verdict is in your favor or not, the relationship between all parties is irreversibly damaged.
Bad blood can then go on to create bad word of mouth among customers, the loss of important vendors or clients, and problems forming future relationships. Protecting your business interests may involve more than just winning a judgment. It may be more important to engage in a productive and healthy dispute resolution process that doesn’t draw unnecessary lines in the sand or make enemies.
3. Business Is Less Interrupted
Small business owners have a myriad of responsibilities just running their operations. Unfortunately, responding to or initiating a lawsuit often takes up a lot of time and requires great effort. Even with the help of attorneys, you’ll have meetings to attend, documents to gather and prepare, depositions to make, witnesses to locate, and hearings to navigate. And you’ll have the public relations to manage.
In general, both mediation and arbitration — the primary forms of ADR — are much faster than traditional court cases and don’t involve the same level of preparation and documentation as a court case. This means less of your time devoted to resolving this one issue and more spent on your business.
4. You Have More Control
Leaving the final decisions to a judge or jury means that you put your company’s fate into the hands of others. You may have only limited options for compensation or restitution, and you are dependent on the judgment of another to decide how to right a wrong. Negotiation, on the other hand, provides much more room to craft your own solutions.
The court, for instance, may only be able to offer compensation for a breach of contract, but what you may really need is that contract completed. Mediation seeks to find a compromise that benefits both parties. Creative solutions; like partial fulfillment, arranging for someone else to fulfill the contract, or coming up with a new agreement; are on the table. You decide what you need and how to get it.
5. It Mitigates the Outcome
Because ADR works out amenable solutions between parties, it often results in less severe outcomes for both sides. While this can be a disappointment to those with a strong case, it’s of real benefit if your case is not as good as you’d like. And even if you could get more money from a court battle, the appeal of a less severe outcome for the other party could help bring things to a fast, positive conclusion.
Where To Learn More
Could any of these benefits of alternative dispute resolution help with your legal case? Whether you want to save money, time, or reputation damage, the answer may be yes. Start by learning more through consultation with Mohajerian, A Professional Law Corporation. We will work with you to find the best path to a positive result. Call today to make an appointment.