Court processes can help settle business disputes, but they are not the only ways to do so. Other methods exist that are less time-consuming, offer more involvement, and guarantee privacy. Known as ADR, or Alternative Dispute Resolution methods, they provide low-cost processes to settle business scores.
Even though these ADR methods more often than not, do not result in vast sums of money being awarded in damages like it often happens in a civil litigation case, they can often have more positives than negatives.
Here are the 5 main alternatives to business litigation.
- Arbitration Method
Arbitration is one of the most common forms of ADR. It resembles a regular lawsuit, but without the litigation, attorney, courtroom, and all the other elements of a court case. The warring parties have a say on what rules to follow for the process, although most adopt the American Arbitration Association rules.
Arbitrators do not need to have legal backgrounds, neither do they need to follow any formulated rules. Their sole purpose is to help determine disputes in a neutral way that’s acceptable to both parties. You may still need the advice and input of an attorney all throughout the arbitration process to help you argue your case effectively.
Perhaps the one distinguishing factor about an arbitration proceeding is the power which the arbitrator to decide the the outcome of the dispute.
- Mediation Method
In mediation, a third party, known as a mediator, helps the disputants reach an agreement. In most cases, the parties involved get to choose an individual they prefer to act as the mediator. They can do so on the basis of the person’s skills, experience in similar cases, character, and the nature of the dispute. The mediator can even be an attorney who practices in the field of law that the dispute falls under.
Mediation presents a form of ADR where both parties have an equal say in settling the dispute at hand. They can also put forth their thoughts and discuss better ways to end the conflict, unlike in a lawsuit where the outcome solely lies with the judge and the competence of the litigation attorney.
Unlike in the arbitration method, mediation cases are hardly binding and the parties are not bound to accept the resolution of the mediator.
- Private Judge Method
In this form of ADR, the involved parties find a retired judge to determine their case. It’s almost similar to arbitration, only that the arbitrator here is a legal professional trained to hear and settle lawsuits. Although arbitration may sometimes involve retired judges, the private judge method must use one, and standard court processes are followed. The judge’s decision in this method also assumes a legal status similar to that of a real court.
The private judge way of settling business disputes is gradually gaining popularity. It’s almost similar to a real lawsuit, but minus the court. Because the rules and procedures followed are those used in usual suits, it makes a better way to avoid court cases that take too long to be settled.
- Mini Trial Method
Mini-trials vary in the procedures used, but it usually involves business executives from either side and a nonpartisan advisor. The adviser may be a retired judge, but not a requirement. More often, he or she is an expert in the matter being disputed. The business executives involved need to be the ones directly involved with bringing up the case.
Before a mini-trial begins, the disputing parties will usually exchange documents, witness testimonies and more. They will also agree on the processes, times, and other aspects of the case. A mini-trial takes typically between one and four days l depending on the complexity of the issue at hand.
- Summary Jury Trial Method
It involves lawyers of the warring parties selecting a jury to issue a verdict on the dispute. The judge usually does not inform the jury that their judgment won’t be binding but only advisory. They do this to avoid cases where the jury members don’t commit to the case fully.
To start off the case, the judge issues instructions to the jury which is then followed by the lawyers making their arguments. The process ends with the judge making final remarks regarding the law, and the jury retiring to arrive at a verdict.
The summary jury trial takes a day or, at times, two. The disputing parties are required to attend the proceedings. After the jury gives its verdict, the parties are expected to discuss and agree on a settlement. They do so in the absence of their attorneys. Should they fail to agree, the case goes to a court.
Alternative litigation methods are less formal compared to lawsuits, but much desirable in most cases. They offer businesses a quicker way to settle commercial disputes. Because they are mostly private processes, they result in less damage to the names of the businesses involved.
However, ADR methods are not always the best ways in every case. It depends on many factors such as the award a law court is likely to offer. Your civil litigation attorney would be better placed to advise on what method to go for.