If you have an issue with a contract, whether it is a dispute with a former employee or an issue with a supplier for your business, you may quickly find yourself worrying about how you can enforce your rights. Far too many people immediately jump to litigation, failing to realize that there may be other options available before they go to court.
The state of Texas allows individuals or businesses to pursue several kinds of legal alternative dispute resolution options before they ask the courts to intervene in a contract dispute. While it is not necessary to take advantage of these alternative dispute resolution systems, they may offer more affordable and faster ways for your company to address contract issues.
Arbitration lets you privately resolve the matter
When you go to court, the idea is that a neutral party, the judge, will hear both sides and make a decision based on reason, rather than attachment to either party involved in the dispute. However, when you go to court, everything becomes public, which can be problematic for businesses or individuals in the public eye.
Arbitration, on the other hand, is a private process that takes place behind closed doors and is not part of the public record. You will work with a neutral arbitrator who will hear both sides of the situation and determine what is fair and reasonable. If you are unable to abide by the terms of arbitration, you may still find yourself headed to court, unless your contract has a binding arbitration clause.
Mediation involves working with the other party
In arbitration, as with typical court situations, a third party has all of the power. When you choose mediation as your form of alternative dispute resolution, you retain some of the authority and decision-making power that the arbitrator or judge would otherwise have.
Mediation involves a third party who serves as an intermediary between the people on the contract. The mediator helps them compromise and find a solution that works for everyone involved. Like arbitration, mediation is private. If you would like to see if you can't resolve a contract issue before going to court, discussing mediation or arbitration with your attorney may be a good idea.
Benefits of alternative dispute resolution
The increased privacy is only one of the many benefits of alternative dispute resolution. It is typically much more affordable to go through arbitration or mediation than it will be to go through court.
After all, instead of paying for your individual attorneys plus court costs, which can become lengthy as the case stretches out over time, you will only need to pay for the time for your lawyers and the time for the mediator or arbitrator. Even if it takes multiple sessions to resolve the issues, that process will still be faster and more affordable than a protracted court battle would be.