You've heard why mediation can be a good alternative to filing a lawsuit. The two big reasons are time and money; mediation can be less time-consuming and less expensive that going to court.
But mediation is not a one-size-fits-all solution for resolving disputes. In this post we look at situations when mediation is a smart alternative, and when it isn't.
Mediation is a good idea...
1. When your business has a longstanding relationship with the other party. Mediation can be thought of as relationship counseling: both sides want to continue to work together, but outside help is needed to resolve a current issue. When the relationship is especially valuable, mediation can help you resolve an isolated issue, without affecting the overall health of the relationship.
2. When you want to reach a settlement. Mediation can be very effective when you know that a resolution exists but you need help finding it. An experienced mediator can help you identify middle ground that you're not capable of seeing.
3. When you want the dispute to remain private. Mediation is done in private. Lawsuits, however, are matters of public record. When it's important to keep the dispute out of the public eye, then mediation is definitely worth considering.
Mediation NOT a good idea...
1. When you believe the other party is completely in the wrong. Compromise is the essence of mediation. Give-and-take is part of the process. When one side sees a black-and-white dispute, then mediation is unlikely to be effective.
2. When you want to establish a "precedent" with the other party. Mediation is not binding, so the outcome of the mediation will have no legal effect on future behaviors and/or business practices.
3. When you believe a lawsuit would give you a vastly better result than mediation. Litigation is expensive, but when it would yield a better outcome than mediation, then litigation might be the best approach.
If you have questions about mediation or litigation, it's wise to speak with an attorney who has experience with alternative dispute resolution.