In last week’s alert we looked at the alternatives to litigation. In this second article of three we now weigh up the advantages and disadvantages of each.

We would be very happy to hear from you if you would like to discuss the options.

The pros and cons of various methods of resolving disputes

Although legal proceedings are still the default method of resolving contract disputes, they are one of many ways of doing so. This article looks at the various ways of resolving disputes and the considerations for deciding which is most appropriate.

Negotiation

A quick, inexpensive and binding resolution is almost always the desired way to settle a dispute. The way to achieve this is by negotiation. The problem is that negotiation is far from guaranteed to succeed before it is necessary to resort to some other more formal and structured method of dispute resolution. This may take the form of mediation.

Mediation

Although more expensive than a simple negotiation, mediation will allow you to retain control over the outcome of the resolution. This is because, like negotiation, it is non-binding. This means that decision will not be imposed, unless you reach a binding agreement. This is unlike going to Court where, like it or not, the judge will ultimately make a binding decision as to who wins and who loses (i.e. the judgment). Mediation will be relatively inexpensive in comparison to other more formal methods of dispute resolution.

Both mediation and negotiation give you much greater control over the outcome than any other method of dispute resolution.

Other methods of dispute resolution

When it comes to other forms of dispute resolution, the decision may be out of your hands, in that the contract may say that any dispute must be resolved by court proceedings or by arbitration. As we mentioned in our previous article, the best time to consider what is the most appropriate way to resolve potential disputes is before you enter the contract.

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