Negotiation, Litigation, or Mediation: Which One Fits Our Needs?
March 15, 2023
Running a business involves interacting with other people and entities to achieve the goals of the enterprise. Of course, every business needs customers, but it also needs agreements with others to provide goods or services. These agreements often are formalized in contracts, and even if they are just handshake agreements, they can be viewed as oral contracts.
Almost always, a business will face disputes, whether it's with customers or entities helping the business achieve its goals. Probably the most serious of these disputes involve a breach of contract – a supplier or service provider fails to live up to the terms of the mutual agreement.
When a dispute arises, there’s always the possibility of litigation, of matters being resolved in court, but there are also alternative dispute resolution methods that can and should be considered first, beginning with negotiations and then leading to mediation or arbitration. Which is the best?
A lot depends on the parties involved, but consulting with an experienced business litigation attorney is the first logical step.
If your business is involved in a dispute in or around Irvine, California, contact William B. Hanley, Attorney at Law. With more than 40 years of experience handling business disputes, Attorney William B. Hanley can advise you on the best path forward and help you resolve the matter, even if it eventually ends up in court.
His firm also serves clients throughout Orange, Los Angeles, and San Diego counties, California.
Option 1: Negotiation
Every dispute should probably begin with the parties involved negotiating with one another. Going to court before talking with each other is only going to heighten tensions and cost the parties involved attorneys’ fees and court costs. The parties can agree to meet and discuss the situation. One party can also hire an attorney to help with the process, or both parties may opt to enlist legal aid.
Option 2: Mediation
If negotiations stall or lead nowhere the parties can mutually agree to mediation. A third-party mediator sets the ground rules for the session (or sessions) and oversees the discussions and interactions.
The parties themselves are guided to work through their differences and arrive at a resolution they can both agree to. The mediator is there merely to facilitate the process. Though the mediator proposes a resolution, neither party is bound to abide by it.
Option 3: Arbitration
Arbitration is much more formal than mediation and resembles a court proceeding in many aspects, including the rules of evidence that can be submitted. Both parties must agree to the arbitration process, whose result will be binding.
Notably in California, Assembly Bill (AB) 51 has outlawed the use of mandatory arbitration clauses in employment agreements, but the legislation is still being fought in court and is not being enforced. Nonetheless, the bill does not affect arbitration agreements between business entities.
Option 4: Litigation
If the parties can’t achieve a resolution through negotiation or mediation and can’t agree on arbitration, then matters can end up in civil court. This, of course, represents a more time- and cost-intensive means to resolve.
If one party sues the other, for instance, for breach of contract, then the party being sued has 30 days to respond, or the court can issue a default judgment in favor of the plaintiff.
If the lawsuit goes forward, there will be a period during which both plaintiff and defendant can examine the evidence each has. Many, if not most civil lawsuits end up with the parties settling before the trial begins.
Turn to William B. Hanley for Help
Disputes don’t need to end up in court, and the alternative methods of resolution provide for a less exhausting and less costly means than litigation. Bring your dispute to William B. Hanley, Attorney at Law, and let him advise and guide you on the best route to resolution.
If matters end up in litigation, he will aggressively represent your interests and strive for the best possible outcome. Reach out immediately if you’re in or near Irvine or anywhere in Orange, Los Angeles, or San Diego counties, California.