Mediation is a non-binding procedure where two or more parties bring their dispute to a trained mediator, who helps the parties find a mutually agreeable solution to their problem. It is becoming the preferred way to settle business disputes.
Mediation is more flexible than a lawsuit, because all of the parties have a hand in arriving at a joint resolution. The terms of the resolution are limited only by the imagination of the mediator and the parties and can include not only payment from one party to another, but an agreement about how future relationships will be structured and enforced. Not only is the current problem resolved, but everyone leaves with a better business relationship.
There are further advantages:
Speed. The average lawsuit takes one and a half to two years to conclude, and a complex case with many parties can take 3 to 4 years. A mediation can be scheduled in months (or less) and take anywhere from a half day to 5 days, depending on the complexity of the issues.
Cost. Mediation can save money in two ways. One, problems are resolved more quickly, so less of your time is devoted to the dispute and more time is spent actually doing your job. Two, the cost of preparation and presentation is much less. Evidence can be presented via records and documents, rather than live testimony. If an expert opinion is needed, a report can be submitted rather that having the expert travel to a trial and testify in court, which can be a very expensive process.
Finality. A losing party in a lawsuit has a right to an appeal. That can add another year or more to a resolution and increase your costs. There is no reason to appeal a mediated solution, because the parties have agreed to be bound by their joint resolution.
Flexibility. When parties agree to mediation, they are free to fashion whatever terms and conditions they want. You get to pick your mediator, the issues that will be submitted, the manner in which the mediation will be conducted, and the terms of the final resolution. You can agree that the whole process will be confidential. With mediation, you’re in control of the process.
A mediation program can be implemented in your business relationships before any problems arise. Write it into your contracts with suppliers, customers and affiliated businesses. You can approach those with whom you already have contracts and say let’s agree to a mediation procedure for resolving any disputes that come up. If you’re already in a lawsuit, suggest it to your lawyer and push to have it explored. Just because a lawsuit has been filed doesn’t mean that you can’t decide to step out of the system and explore other possibilities.
The Lancaster Bar Association has set up an mediation program that is available to all. For a complete description of the program, go to the Bar Association web site, lancasterbar.org and click on Alternative Dispute Resolution or call the LBA at 393-0737.
Richard Low is a partner with Herr & Low, P.C., concentrating in mediation and civil litigation. He is the past President of the Lancaster Bar Association and a member and former chair of its Alternative Dispute Resolution Committee, and a member of the American and Pennsylvania Bar Associations Alternative Dispute Resolution Committees.