When most people think of a lawyer, they probably think of someone passionately presenting a case in front of a judge and jury. Although our Chattanooga contractor attorneys have plenty of experience providing litigation services, including delivering compelling arguments on behalf of our clients in courtrooms, for many of our construction clients, litigation isn’t always the answer. In order to preserve a relationship and ensure that both parties are mutually pleased with the result, the answer may be alternative dispute resolution (ADR) services.
In this editorial, the attorneys of Cotney Construction Law will discuss the circumstances in which an ADR process, like arbitration or mediation, may be the best option to resolve your dispute. Remember, for any of your litigation or ADR needs, a knowledgeable and experienced Chattanooga contractor attorney is standing by.
For many construction firms involved in a dispute, the most practical and cost-effective option to resolve their issue is with ADR. ADR is less formal than litigation and doesn’t involve a judge or jury. Instead, each side of a dispute works with an unbiased, third-party moderator. This knowledgeable professional will listen to both sides of the dispute and determine the best course of action to take to resolve the issue. Depending on the type of ADR process selected, this may be a binding decision or just advice to resolve the issue.
Here are some other benefits of the ADR process:
- More Control: both parties can agree to the type of ADR process they are interested in pursuing. The parties can then schedule hearing times tailored to their schedule and determine what type of evidence can be used in the proceedings. They can also mutually appoint a mediator or arbitrator to resolve their dispute. ADR gives both parties complete control over the type of legal proceeding they want to take on.
- Accelerated and Cost-Effective: as litigation can be a drawn out process that takes months, if not years, to seek a resolution, a final decision from arbitration can be resolved much quicker. Of course, when you accelerate the legal process, this means that construction firms are also spending much less on legal costs. Instead, the construction firm can reallocate this legal spend to other valuable resources like contract review by a Chattanooga construction lawyer or a monthly subscription plan with a construction law firm.
- Privacy: an ADR hearing is confidential. This is an attractive feature considering that both parties can deliberate without fear of their issues becoming publicized. In a trial open to the public, anything disclosed is fair game for journalists and bloggers. The topics and facts presented in an ADR hearing remain confidential between the parties involved in the process.
- Keep Everyone Happy: ADR can be a great way to mend or preserve professional relationships. The ADR process can resolve disputes in an effective and positive way where both parties agree to a compromise that accommodates the other party’s needs. Trials typically end with one side victorious. ADR can result in each side of a dispute actually benefiting from a successful ADR process.
What Are Your ADR Options?
There are many elements that can factor into the type of ADR process your construction firm elects to pursue. For example, some ADR processes are non-binding, whereas others are legally binding. The two most common forms of ADR are mediation and arbitration. Let’s take a deeper look at each of these processes and describe a few instances in which either ADR process is the preferred option.
When two parties have a dispute and undergo mediation, a mediator steps in and attempts to resolve the issue by finding a mutual agreement between the parties. Mediation is a great way for both parties to present their side of a grievance, communicate with each other, and try to settle the issue. Mediations are non-binding, so unresolved issues could end up going to arbitration or litigation. If you are looking for a more informal legal process to air your grievances and come to a resolution, a mediation could be the right option.
Is Mediation Right for My Dispute?
Mediation is an excellent option for two parties with a strong business relationship. More importantly, both parties want to keep that relationship intact by avoiding a more formal legal process like litigation. Mediation can be a great way of casting aside your differences and looking at the key bullet points that are interfering with your ability to resolve the issue at hand. As long as both sides are willing to compromise and consider the needs of the other party, mediation can resolve these issues so that both parties can move forward with a strong partnership. The only downside of mediation is that if one side doesn’t take the process seriously or elects to ignore the advice from the mediator, it can result in a stalemate. Similarly, if one side has considerably more power than the other side, they may be unwilling to meet in the middle to resolve a dispute.
Although arbitration is not as formal as a trial, it is considered more formal of a process than mediation. During arbitration, both parties select a highly knowledgeable, neutral professional known as an arbitrator. From here, both parties can present their side of the conflict to the arbitrator, including presenting evidence to support their argument. Arbitration can be either legally binding or non-binding depending on the agreement. For a non-binding arbitration, an unsatisfied party can pursue litigation. In a binding agreement, both parties agree to waive their right to appeal the final decision by the arbitrator. This includes waiving their right to pursue litigation after a decision was reached by the arbitrator.
Is Arbitration Right for My Dispute?
Arbitrations are best for disputes in which both parties want a cost-effective, quick resolution to a dispute without the long-term stress and expenses associated with a lengthy trial process. Another advantage to arbitration compared to a trial is that the arbitrator is highly knowledgeable in the subject matter compared to leaving the decision in the hands of a judge or jury unfamiliar with construction processes. It is especially important for construction professionals to have an arbitrator in place that can hear each side of a dispute and understand the intricacies of the dispute in the context of a construction dispute. Although arbitrations have many advantages, some disadvantages include that binding arbitrations leave little wiggle room for displeased parties as they cannot appeal a decision made after undergoing this process. This can lead to some challenges with preserving a relationship if one side of a dispute is frustrated with the arbitrator’s ruling.
Consult a Knowledgeable Attorney
If you are involved in a construction dispute, it’s important to evaluate all your legal options. This includes whether or not you should pursue mediation, arbitration, or litigation. Fortunately, construction firms have a reliable advocate in their corner when they consult the Chattanooga construction lawyers from Cotney Construction Law. We can closely assess the facts related to your case and develop a strategy that protects your best interests and ensures the long-term success of your construction business. For any of your construction legal needs, consult our Knoxville construction attorneys.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.