For many businesses, both big and small, a day may come when you receive some bad news: you’ve been sued. Whether you’re being sued by a customer for a transaction gone bad or by a business partner that looking for a bigger piece of the pie, a lawsuit is often an open-ended affair with unknown requirements of time, energy, and (most importantly) money. While this isn’t always the case, one legal alternative that can sometimes help to minimize the costs and efforts of full-blown litigation is mediation.
Mediation is a form of alternative dispute resolution (ADR), whereby two or more parties attempt to resolve their conflicts without going through the time and expense of trial. Mediation is extremely common in today’s civil disputes, and often times judges will require parties to go through mediation prior to proceeding to trial. The main objectives of mediation are to gather information, learn about the strengths and weaknesses of your case, and possibly come to a resolved settlement between you and your adversary, all the while without the formalities and consequences of pursuing a lawsuit.
In mediation, the mediator, typically a professional agreed to by both sides, plays the role of an impartial, unbiased fact-seeker who helps to guide the discussion. The mediator has no judicial powers, and nothing they say can be used in court. Rather, the mediator tries to elicit information from both sides while highlighting important facts, questions, and answers. While a negotiated settlement of the matter is not always feasible, mediation provides an opportunity for both sides of a dispute to hear each other and to decide whether or not the costs of going to trial will be worth it. By including mediation provisions in your company’s contracts, you may be able to avail yourself of this alternative process before being forced into trial and all of the consequences that come with it. Mediation is not a fix-all solution, but it is a very strong tool that opposing parties should consider before taking on the headaches that can come from formal litigation.
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