In a perfect world, parties tied to contracts would always follow through on their promises. But as business professionals in New York and other states know, people and companies don’t always agree. Most parties want disagreements resolved as amicably as possible when business-related disputes arise.
Understanding mediation
When two or more parties dispute issues, taking another party to court is often expensive and time-consuming. Litigation helps resolve disputes by having a neutral third party, a professional mediator, understand each party’s argument.
Mediation is often a beneficial way to resolve business or contract disputes because:
- It’s a private way to resolve disputes without anyone being privy to what’s happening.
- Mediation typically focuses on outcomes in which all parties benefit.
- It’s less formal and rigid than litigation proceedings.
A closer look at the mediation process
If the contract in question includes an option for mediation, this process can begin right away. In cases where there’s no mediation clause, these parties might need to complete and submit a submission agreement.
The next step involves choosing a mediator, which is also an excellent time for disputing parties to agree on a mediation style. There are three mediation styles: facilitative, evaluative and hybrid method. A facilitative mediator works with both parties to find an outcome that satisfies everyone. Evaluative mediators listen to each party’s argument. Then, this mediator usually lets each party know how strong their arguments are. This person also hypothetically picks which side will likely win in a courtroom setting. Hybrid mediators offer elements of both facilitative and evaluative mediation.
Certain mediators can resolve disputes between parties in only a few hours. More complex disputes could take several or more mediation sessions to fully resolve.