Taking your case to court can be costly and time-consuming. In my opinion, it should only happen when there’s no other way for the disputing parties to reach some middle ground. That’s why it’s good to know about other options, such as negotiated settlements, also known in legal circles as Alternate Dispute Resolutions (ADRs).
Each type of negotiated settlement comes with advantages and disadvantages. Here’s how different ADRs stack up:
Settlement Conference
Generally involves the individuals in dispute and their representatives meeting together in-person, over the phone or online, and attempting to resolve the issue themselves.
PRO: Doesn’t require a third-party who’s unfamiliar with the individuals involved or the particulars of their dispute.
CON: No guarantee a settlement conference will work, since the reason parties are in litigation in the first place is because they couldn’t resolve the issue.
Mediation
This type of negotiation includes a professional mediator hired by both sides to try to assist the parties in reaching an agreement. The mediator may or may not be a lawyer, but is almost always trained (and often certified) in mediation techniques. He or she usually has knowledge of the applicable law.
PRO: When both parties are at a standstill, getting a knowledgeable outsider’s perspective can be very helpful. Also, it’s also a good way to see if your position has what’s called “legal standing”—that is, if it’s reasonable and has a decent chance of prevailing.
CON: Hiring a skilled mediator adds to legal expenses, since this individual can charge as much or more than your own attorney does. (The cost is generally split between both parties.) It’s still cheaper than taking a case to court.
Arbitration
This type of proceeding is less formal than a trial but more formal than mediation. The arbitrator, (an individual or multi-person arbitration panel), is a neutral third-party. Both sides in the dispute decide beforehand whether the arbitrator’s decision will be binding or non-binding. (In my experience, binding arbitration is a useful option when a settlement conference or mediation is unsuccessful.)
PRO: Encourages cooperation and a non-hostile approach toward resolving an issue. Also, it’s cheaper and faster than litigation. The rules of evidence and procedure are simpler than those in a court of law. And arbitration proceedings are typically confidential, saving both sides any potential embarrassment or the release of private information.
CON: Costs can add up when choosing both an arbitrator and a venue for the negotiated settlement. If both parties determine the decision will be binding, it’s very difficult to appeal or “vacate” the decision at a later time.
If you’re involved in a legal issue, talk to your lawyer about seeking an alternative dispute resolution that’s suits your specific situation.
Are you in need of legal counseling? The Law Offices of Ian S. Topf offer free consultation in a variety of issues, ranging from bankruptcy, family law and estate planning to traffic violations and landlord/tenant disputes.
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