Legal Management

Litigation As a Last Resort: How Mediation Can Help Small Businesses

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People assume that running a small business means that you have to deal with less stress and have fewer problems, but it’s not the case. Challenges of being in charge of small business are many and keeping up with them can have a bad impact on your health. Owning a business is a great responsibility and when you’re in charge you have to think about many things, and effective dispute management strategy is one of them. When faced with seemingly insurmountable problems, mediation can be of great help.

When You’re Damaged

Even though small business lawsuits can really help you with a legal dispute, they shouldn’t be taken lightly. They can truly be long and expensive and by the time things are finished, you can find yourself looking back and thinking about whether you could have avoided it. There are many types of damages that can occur when you’re dealing with a small business, and each and every case should be specifically identified and evaluated before it gets to court. When you’ve actually suffered damages, a lawsuit might be a good idea, but there are other things you might want to try as well. There are many drawbacks of lawsuits and the most important ones involve time and money – your business will suffer if lawsuits take too long and you’ll have to spend a lot of money on lawyers.

Find the Right Mediator

Mediators are here to help you resolve civil disputes but unlike lawyers and lawsuits, they will do everything in their power to preserve the good relationship between both sides. You should find a company that’s willing to offer trustworthy small business law advice and that can explain the steps necessary to smooth things over. Not only is mediation often quicker, but it’s also significantly cheaper than a lawsuit, and you’ll be able to save a lot of money as well good relationships with your employees and/or business partners. Finding a good mediator is also very important and you should give it a lot of thought because the right mediator will mean a shorter and more effective mediation process.

There Aren’t Strict Rules

While people usually choose litigation because there are strict laws to abide by, mediation offers an alternative. There aren’t strict rules here – mediation is an alternative problem-solving process that involves both parties and requires full commitment to finding a solution. Not only is it efficient, but it’s also cost-effective, which means that both sides will likely manage to save money they would otherwise spend on court proceedings. They aren’t lawyers that are going to fight for your case and cause while navigating strict rules of law. Mediation is simply a means of communication that doesn’t involve filling out documents or appearing in court. It’s less formal and more flexible, and both parties work with a mediator.

Understanding the Other Side

When you choose to use mediation instead of litigation, you’re ensuring that your side has direct input as well as the other, and the results are often more meaningful and effective. Because both sides are directly involved in the process, there are opportunities to hear the other side and understand their point of view a bit better and vice versa. This insight into other side’s reasoning is a powerful tool to help you understand the situation better. In addition, mediation will be able to help preserve business relationships which would otherwise be frayed from all the legal disputes.

Don’t Waste Time

Litigation is stricter and poses more limitations on both sides whereas mediation not only allows but also encourages the open flow of information. The main goal is to resolve the issue and not the best positioning for trial. In order for both parties to fully understand each other there has to be full disclosure, and after both parties were given a chance to fully discuss all of the issues they have, resolution easily becomes a possibility. Another important issue that mediation can help small business with is the issue of time. Litigation takes not only a lot of money but also a lot of time, and for this reason, the business can suffer. Mediation, on the other hand, is timely and immediate, which means that there will be less disruption of your regular business operations.

Depending on the problem your small business is facing, litigation may truly be the best solution, but it will take a great toll on your resources, your employees, your budget, and your time. This is why you should first try to resolve the problem using other means. Mediation has been proven as a great way to overcome obstacles and come up with effective solutions, so before you throw in the towel and call your lawyers, you might want to give it a try first.

About the Author

FullSizeRender  Daniel Brown is a law graduate and a passionate blogger from Sydney.  His areas of interest are alternative dispute resolution and its applicability in different fields of law, IP law and resolution of disputes arising from intellectual property infringement and commerce law.

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