When two parties are in a dispute, it is typically wise for them to consider alternative dispute resolution (ADR) prior to or pending litigation. Mediation is a form of ADR in which a neutral third party—usually a trained mediation attorney or retired judge—meets with the disagreeing parties to assist in reaching a settlement. In business, mediation is often the ideal solution for disputes involving employment, breach of contract cases, various transactional matters, workers’ compensation claims, ownership disputes, buyouts, and many other situations that are not overly complex. Read on to learn about the process and advantages of mediation.
How Mediation Works
It’s important to understand that a mediator does not make a binding decision like an arbitrator or judge. Instead, their role is to help guide both parties to a resolution they can both live with and amicably fulfill, with assistance from the necessary legal professionals if necessary. Many people equate mediation to simply “talking it out,” but the process is actually quite defined and deliberate.
Mediation usually begins with opening statements from the mediator and then from the disputants, or their attorneys, in a neutral, mutually agreed upon location. The disputants are given the opportunity to share their respective sides of the story with the mediator and recommend resolutions they might deem to be fair, often in person but also in the form of a mediation brief which is supplied to the mediator prior to a scheduled mediation date. Typically, all parties are in the same room while these statements take place, but the mediator may choose instead to keep the parties in separate rooms if there is a history of animosity between the parties.
After opening statements have been completed, the mediator usually facilitates a joint discussion to identify and address the key challenges. Then, each disputant is provided a private meeting with the mediator before another joint discussion. Ideally, a written agreement is then reached, and the parties can obtain closure upon executing the agreement. However, the process can repeat if needed, negotiations may continue, or the mediator may recommend other options for resolution, such as arbitration. If mediation and arbitration do not successfully settle the dispute, formal litigation may be required.
Deciding Whether Mediation is Right for Your Business
Mediation is most commonly used in civil cases, such as divorce or non-criminal disputes. However, there are also many business disputes that can often be settled with mediation, such as conflicts with customers, employees, vendors, competitors, or even among business partners. The key requirement for mediation in any dispute, of course, is that both disputants must be on stable enough terms and able to communicate rationally for the process to have any hope of reaching a resolution. In other words, if there have been repeated threats of violence, emotional outbursts, or other conduct suggesting the parties would be unable to mutually agree on anything, then mediation may not be productive.
Mediation is generally much faster and more cost-effective than hiring a lawyer to seek a settlement and/or proceed with litigation. Even if the mediation process goes through several rounds of joint negotiations, these meetings do not take near the time a lawyer would spend preparing a case for court hearings and a trial. The San Diego business attorneys at Gehres Law Library often represent parties in mediation and also act as mediators in business-related matters. Our mediation attorneys will schedule a mediation date once each party makes a deposit reflecting their intention to proceed with mediation. If the mediation goes beyond the deposited number of hours, the additional time is billed to the parties in quarter hour increments.
In addition to time and cost savings, mediation can also help mend the relationship between disputants through direct and confidential conflict resolution. In business mediation, it’s not unheard of for disputants to completely resolve their conflict and continue working together since mediation brings the parties together, rather than encouraging them to fight, as is the case with the litigation process in general.
Preparing for Mediation
Once you have decided to enter mediation, you might find yourself anxious or nervous for the first meeting. You can diffuse the nerves—and the emotions—by taking a few simple steps to prepare:
- Remind yourself that your reason for choosing mediation is to solve the conflict, and commit to providing a productive statement.
- Organize any necessary documentation to support your statement.
- Be direct and concise with what you are looking for in a resolution.
- Make an honest attempt to understand the other party’s grievances.
- Envision the other party’s potential claims or responses, and compose answers to them beforehand.
- List your main talking points separately from the rest of your notes and materials.
Writing Mediation into Contracts
Adding a mediation clause to your contracts can help to prevent lawsuits against your business. At the very least, a mediation clause should outline how a mediator will be chosen and how the costs of mediation will be covered. The clearer the terms are, the less room there will be for future disputes regarding the process itself. Learn more about developing an effective mediation or arbitration clause in this article.
Choosing a Mediation Attorney
A mediator is typically trained in conflict resolution and negotiation, however, the level of skill and aptitude can vary greatly. The State of California does not have strict training requirements for mediators, allowing professionals from different fields to simply complete a recommended 40-hour program and begin seeking mediation opportunities. Because of the loose training requirements, many people in need of mediation seek an experienced mediation attorney with a good track record to ensure they are getting the best expertise and service.
With many years of experience as mediation attorneys in San Diego, Gehres Law Library is able to provide affordable, legal-focused dispute resolution for businesses of all types and sizes, as well as representing parties in mediation. If you are considering mediation for a business dispute, call us at 858-964-2314 to speak with a qualified mediation attorney today.