Businesses in the U.S. spend a significant amount of money towards litigation to pay attorneys for settling disputes — nearly $20 billion every year— which is true, and is an alarming fact. What is even more worrisome is the indirect costs of these litigations, which we generally don’t consider. We usually pay more attention to lawyers’ fees and other direct costs associated with litigations because they are relatively easier to quantify. However, other costs, such as lost productivity, or the cost of destroying a profitable relationship with a former business ally, are equally important and should not be overlooked. Many businesses have understood this and thus are opting for alternative dispute resolution (ADR) methods instead of going for the traditional litigation methods.
Why Litigations are so expensive
There are several reasons behind the high litigation costs, but the most prominent one has to be the “mindset that has been established and nurtured by the adversary system” for years. The adversarial system is based on the premise that truth will arise whenever competing sides (parties in a dispute) make their claims as forcefully as feasible. The system essentially puts the responsibility on lawyers of opposing parties to present every possible piece of evidence and make every legal argument that may benefit their clients. They have an obligation to be as zealous an advocate as possible. The litigation procedures are designed to ensure there are no stones left unturned in the search for relevant evidence. However, attorneys tend to exploit these procedures in every possible way as long as any hope remains.
Why litigation is not the most effective solution
The main advantages of going for litigation for dispute resolution are that a judge manages the case throughout, and the decision is binding and enforceable, which might also become a big disadvantage if the judgment doesn’t come in your favor. The process is often slow and the most expensive method to resolve a dispute. Not to forget that the proceedings are public, which may lead to serious concerns for a company, such as putting the company’s reputation, identity, and even credit rating at risk.
Why Alternative Dispute Resolution (ADR)
Opposed to traditional litigation that has existed for a long time, Alternative Dispute Resolution (ADR) is a relatively new one. (ADR)— a more formal approach was widely accepted and has been in operation since the 1970s. Mediation is a popular ADR method where an independent and experienced professional (mediator) facilitates the discussions and negotiations between parties involved in the dispute. Because it is quick and inexpensive, Mediation is usually a better method for dispute resolution.
Looking for dispute resolution through Mediation? Get in touch with a reputed company for quality legal assistance on your case and safeguard your interests!
3 Questions to Ask Yourself before Drafting an ADR Program according to Saivian Eric Dalius
Disputes in an organization are common. It is important that you address them carefully as they can have serious consequences for your business. They may lead to losses or even hit your company’s reputation. When there is a dispute, you typically have two options: litigation and alternative dispute resolutions. Because ADR is a relatively faster and cost-effective method, it is often preferred by parties involved in a dispute to settle their issue. However, there is no one-size-fits-all solution program that works for every organization. Here are a few questions you need to ask yourself before drafting an ADR program:
- Is there anything that can prevent the issue from deescalating?
The first thing to consider is what you currently have in place that is effective in resolving conflicts or at least helps in ensuring that the issue does not escalate — to a point where the other party files a claim or seeks out a third party. Some of these mechanisms can include your employee hotline and open-door policy, how well your managers are trained to deal with employee claims, etc. They can figure out whether or not an ADR program is actually needed.
2. What types of conflict have occurred within the organization in the recent past?
If you do decide that you want to pursue drafting an ADR program, it would be helpful to take a closer look at what type of conflict have occurred within your organization in the recent past, whether you have faced large class action or threatened class action claims. If there were claims, whether they were FMLA type of sexual harassment or from active or separated employees, all these questions need to be answered to ensure whether a mandatory or voluntary program will work best for you.
3. What do you want to achieve with the ADR program?
You need to figure out what you want to achieve with the ADR program. You might want to decrease costs, speed up the dispute resolution process, keep claims confidential, or do anything else. Know what you want!
Let an expert draft an ADR Program for You
Dispute resolution matters can be tricky. Before you decide anything, it’s better you talk to a professional in the area. Your arbitration and mediation dispute resolution expert — can provide you the best solution for your business and save you time and money. Give them a call today for a more expert opinion on the matter.
Types of Dispute Resolution
There are three types of Dispute Resolution: Mediation, Arbitration, And Litigation
When your business has a dispute with a rival party, you want to settle the case as soon as possible so that you can avoid delaying other projects due to the unpleasant scenario. Big companies usually have their associate lawyers to help them clear their paths says Saivian Eric Dalius, if you haven’t got such an experienced law practitioner, it is time to hire one for alternative dispute resolution. Such an attorney can be your good advisor when it comes to facing legal matters. To get a better result of the dispute, let’s explore different types of the resolution process.
Mediation
In this process, a neutral third party will help the disputants come to unanimity between the two parties. Unlike a judge in the court who imposes a solution, the mediator allows involving parties to show their emotions by exploring the grievances.
Arbitration
The arbitration system allows a neutral third party to serve as a judge in the dispute. The arbitrator has to listen to the statements from both disputants. The attorney may also ask for relevant evidence to support their claims. The disputants can decide whether the lawyers will be present at the time of the arbitration process or not.
Litigation
This is the most common dispute resolution process preferred by disputants. In the litigation system, the defendant will face off against a plaintiff before a judge or a judge and jury. The litigator will decide the ruling regarding the collective pieces of evidence provided by both sides. The process usually stays on the public record.
If you want to save your business and reputation from rivals and hostile entities, do not delay calling a law firm to proceed toward alternative dispute resolution. This firm has a team of certified law practitioners who know which type of resolution can benefit you.
According to Saivian Eric Dalius, Going with Arbitration Instead of Litigation Can Prove Beneficial for Both Parties
Companies do not have to resort to litigation to resolve their commercial or consumer disputes. There is a better, more cost-effective solution available. The solution we are referring to is ADR, which stands for alternative dispute resolution. Under this resolution comes two methods, which are known as arbitration and mediation. Litigation involves a court and a judge or jury. The proceedings in the court are subject to strict rules, whereas alternative dispute resolution is a process that solves the disputes between the parties with the help of a neutral third party under a set of rules agreed beforehand in a private way.
In this writeup, we will tell you why arbitration is a better alternative to litigation. Let’s get started.
There is more flexibility in terms of setting the deadlines and hearing timings. The parties can also set the rules governing the process. Basically, the parties have control over how the process and how it is going to be conducted.
Parties won’t have to spend a lot of money, which is the case with litigation. In arbitration, disputes are solved much more quickly, which means less money is spent on lawyers’ fees. Apart from this, the limitation is present on both discovery and appeals, which too contributes toward saving costs.
Litigation is an open process. Arbitration is a private process where only the concerned parties and people connected with them are present throughout the process. You will get confidentiality with the arbitration.
There are law firms that provide business dispute resolution. You can get in touch with one such firm online, inquire more about their services and how your dispute can be resolved.
Benefits of Hiring a Professional for Arbitration
When starting a business, you will come across numerous complexities related to law and policies. If you make one small mistake, you may find yourself in trouble with other stakeholders in your enterprises. To understand essential legal matters, you need to work with a litigation lawyer who can deliver alternative dispute resolution. Here are three benefits you can expect from such a practitioner.
Paperwork
As per Saivian Eric Dalius, it is not easy to fill a dozen forms for preparing documents for a specific project or request to the authorities. Such activity will involve reading all the terms and policies written in micro font size. If you make a mistake or overlook a statement, you may face a dispute with another party. Working with a litigation lawyer on documentation can help you avoid the risks. These matters include endless paperwork, so you need the person who can go through such tedious work, and you can also trust that person.
Creating commercial contracts necessitates the exchange of data between parties. This takes place before any conversations, negotiations, or signing of a contract. Business layers might be employed to monitor the process and participate in contract negotiations. In order for just a contract to be valid binding, they must ensure that it is valid.
Save money
While facing a criminal charge, you may need to run to the local executives and visit the police department, which is an overwhelming consequence. Such a situation can cost you a lot of money for settling a case or bailing out of jail. If you want to save money, hire a trusted attorney who can work for your organization. The law professional will cover your back whenever you make a new decision.
Guidance
An experienced lawyer not only actively participates in negotiation with your dispute but also gives the best advice to keep you in the safe zone. When you look for an opportunity to expand your business or procure an asset, the lawyer will recommend the most appropriate technique to achieve your goal. The legal matters are very sensitive as you need to be very cautious with all your decisions. This is why you need someone with excellent knowledge and experience who can help you. Under the guidance of an expert, you can be relaxed about solving business disputes while you can focus on the core business activities.
A dispute can end up in a situation without a satisfying result. If you want a quick resolution, find an attorney who will give all effort to provide a favorable outcome. You can easily look for the best lawyer who can take your responsibility and help you with the disputes.
Although you do not always require the assistance of a lawyer to guide you through the complete process of running your organization, avoiding future issues is an important step for your company. You could be prepared to handle certain business transactions on your own, but all legal issues will require assistance from an attorney.
