With many business disputes, people assume that they’ll have to go to court. Say that two business owners have been working together. They find themselves in a contract dispute. One claims that the other didn’t provide the goods or services that were paid for or breached the contract in some other way, such as missing a critical deadline.
It is true that these business owners may end up in court. This happens with litigation. A judge can consider the details of the case, the language in the contract and other relevant factors and then make a decision. For those who would rather avoid court, there is often another option: alternative dispute resolution (ADR).
How does this work?
There are a few different ways that alternative dispute resolution can be used, but the general focus is simply on allowing the parties to work together to resolve their dispute. A professional who’s referred to as a “third-party neutral” acts as a mediator. This person helps them through the process, giving legal guidance and referencing any applicable laws. This is often much faster and cheaper than going to court—but it only works if both sides are willing and able to work together.
A third-party neutral involved in the ADR process isn’t trying to “win” the case, and they aren’t making a ruling or any legal decisions on their own. Instead, they’re just providing a controlled environment where the two sides can negotiate and discuss the situation.
Alternative dispute resolution can be valuable, but it varies from one case to the next. It’s very important for people to understand exactly what legal options they have and what steps they should take to seek a proper resolution.