Dealing With Disputes: The Saving Benefits of Arbitration and Mediation, by Rocklin Business Attorney Terry L. Gilbeau

business lawyer rocklin sacramentoLet’s face it, if you are in business long enough, disputes will arise. Disagreements can manifest from clients, employees, business partners, distributors, and any other entity that interacts with your company. If you are unable to resolve these disputes, there is a good chance you’ll receive communication from a lawyer or a court about pending litigation. Depending on the outcome, your business could be in jeopardy. Fortunately, there are ways to resolve conflicts that avoid lawsuits and can save you and your business time and money: arbitration and mediation.

Although some people believe that arbitration and mediation are the same type of alternative dispute resolution, there are distinct differences between the two. With arbitration, parties agree to present their sides to an arbitrator or group of arbitrators (sometimes called a panel). The arbitrator has the authority to render a decision in order to resolve the conflict. Both parties must abide by the arbitrator’s decision unless they choose non-binding arbitration. Under mediation, a mediator meets with the parties with the eventual goal of allowing both sides to negotiate a solution. Generally, if parties decide to settle after the mediation, they can sign a legally-enforceable document outlining the terms negotiated during the mediation session. 

Many businesses have included arbitration and mediation as parts of their employment policies. Companies that perform services or provide products include arbitration clauses in their contracts. This proactive approach to dispute resolution serves several important “saving” purposes: 

Savings in Legal Costs: After an attorney specializing in business contracts drafts arbitration and mediation clauses to meet a business’s needs, the business can utilize those clauses when conflicts arise. Arbitration or mediation can be less expensive than long, drawn-out lawsuits. 

Savings in Time: Once a business becomes involved in a lawsuit, it can take months or years to resolve the conflict. If possible, business owners need to spend time operating their businesses, not in courtrooms. Arbitration or mediation can reduce the amount of time it takes parties to resolve conflicts, allowing business owners to focus on what matters most – growing and improving their businesses.

Saving Business Relationships: When disputes are resolved in a timely and cost-effective manner using arbitration or mediation, both parties are more likely to maintain business or employment relationships. Established relationships help strengthen businesses, and parties will know how to avoid conflicts in the future.

An attorney specializing in business law can help you decide if a mediation or arbitration plan is right for your business. Ultimately, these tools of alternative dispute resolution may allow you to deal with future conflicts effectively. 

The Law Offices of Terry L. Gilbeau provides personalized counsel to clients in a variety of business and personal matters, including creditors’ rights, debt collection, products liability and international transaction issues. His office is located in Rocklin, CA, just outside of Sacramento, CA, near Roseville, Lincoln, Auburn, in Placer County and can be reached at (916-626-5539) or email Terry at Click here for the firm website

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