Select Page

Contractual disputes that arise within a business scenario can have far-reaching consequences. Beyond the facts contained within the contract, disputes over terms can result in long-standing business relationships dissolving, impacting the running of both entities.  

Engaging the services of professional dispute resolution experts could be the solution that helps to resolve the issue at hand without detrimentally affecting professional relationships, resulting in a compromise that suits both parties. 

Thomas Noel Collister Jackson is a UK solicitor and member of Smart Law Solicitors LLP, experts in providing objective-based negotiation services for business clients. The embedded PDF offers some advice on choosing the right business solicitor. 

Dispute resolution can be divided into three main categories: mediation, arbitration, and litigation. 

Mediation 

Mediation is the least formal of the three main approaches to business dispute resolution and therefore usually the first method to be attempted. A professional mediator works with both parties, not to produce a solution themselves, but to help guide the parties towards reaching an acceptable compromise.  

Mediators do not impose solutions, but they do allow parties in dispute to air their grievances in a safe space and ensure that all available information is on the table. Sometimes mediators work with both parties at the same time, while other times they act as a go-between.  

Any resolution reached with the help of a mediator is non-binding unless the parties agree to forge a binding agreement based on the results of mediation.  

The infographic attachment outlines the key steps to be taken in choosing the right mediator for the role. 

Arbitration 

Arbitration is a more formal process than mediation. Although arbitration also involves using a neutral third party to help reach a decision, the key difference is that the final decision of the arbitrator is binding.  

Parties entering arbitration agree to accept the final decision as handed down by the arbitrator before negotiations begin. Arbitration is often used as a follow-up step when mediation has failed to reach a suitable compromise and both involved parties wish to place the decision in the hands of an objective professional.  

Arbitration is less expensive than litigation. It may, or may not, involve lawyers, depending on the wishes of both parties and what is agreed beforehand. The decision made is confidential, final and cannot be appealed. 

Litigation 

Litigation is the process of taking a dispute to court to allow a judge or jury to decide on the outcome. This is the most formal and most expensive of all dispute resolution procedures and should therefore only be used as a last resort.  

Many cases of litigation are settled during the pre-trial phase once the lawyers on both sides have presented all their evidence. Discovery and preparation by lawyers, on both the plaintiff and defendant sides, often results in an out of court settlement.  

However, cases that end up in court can take huge amounts of time and money to resolve. 

Preserving Relationships 

In many cases of business dispute resolution, preserving the professional relationship is a priority for both parties involved. Many people also wish to avoid publicly battling a contractual dispute. These reasons all contribute towards mediation and other forms of alternative dispute resolution as the best path to take, rather than immediately launching a legal case.  

By involving a neutral third party to help make decisions, issues can often be resolved without recourse to the courts, leaving both parties satisfied. 

The short video attachment defines what is meant by alternative dispute resolution.