Fair Resolution Of Business Disputes Is Possible

Creative Thinking in Mediations

The black robed judge peered over the elevated large wooden bench and spoke to the litigants with a stern tone. “I’m suggesting that the parties attempt to mediate their dispute. Why? Because all I can do from the bench is issue a money judgment either for or against one of the parties. But in mediation you have the control to work out a resolution that offers relief beyond money. You can transfer property, make payment plans, and be as creative as you need to be to resolve your dispute. I think your case can be best handled with this approach.” The parties nodded in agreement and thanked the Judge for the referral. “Send me some names” one of the lawyers said to the other as he packed up his briefcase. “Put your thinking cap on” the other answered with a grin. Then he added “we’ll need to get creative to get this case settled before trial!”

Although fictionalized, it is this approach to alternative dispute resolution that distinguishes mediation from the linear results that can be found by litigating cases in court. Judges are limited for the most part in offering any decisions beyond the awarding of money judgments to the litigating parties. Mediation provides an open whiteboard of options for the parties to resolve their dispute. Often times, the issue may simply be the amount of time that one party needs to pay its debts. Sometimes, it’s the simple apology that is needed to initiate closure. And certainly, there are times where all that is truly needed is for the litigants to have the opportunity to express themselves in front of the other party, to literally feel as if they have “had their day in court” before they can begin to accept the possibility of a negotiated resolution.

A skilled mediator can use this creative thinking to help settle cases that typically would be pushed to impasse. By looking “outside of the money” and asking what the parties really are looking for to find satisfaction in their dispute, a mediator may be able to identify non-monetary solutions to the dispute. So instead of two companies fighting over a product delivery that went bad and now losing that customer forever in a payment dispute, maybe mediation can create a “do-over” opportunity to re-establish that business relationship for future sales. There is no end to how adversarial parties can work together to find business solutions to their disputes when given the opportunity. Again, this type of opportunity for creative solutions in not present in the courtroom like it is in the private venue of mediation.

Additionally, changing a litigant’s viewpoint in settlement discussions from thinking about what may be “lost” in settlement as compared to what may be “gained” in settlement, is also an effective tool for a mediator. And the list of things that can be gained by settlement rather than through extended litigation is virtually endless. To start, the parties can think about the possibility of healing the broken relationship between the waring parties. Maybe the parties started off as friends, or maybe the two companies now involved in a dispute previously had a long-standing relationship. Mediation can help mend those relationships where lengthy litigation can only lead to further acrimony and animosity. And there is also the cost of litigation. These days the cost of battling a case in court, with extended docket delays and intrusive discovery methods, may end up bankrupting a company before the litigation can be completed. And certainly, there is also the mental toll taken by people and companies involved in long term litigation. Lawsuits can be very stressful and can distract business owners away from their main goal of growing their business. There sometimes can be nothing more devastating to a business then a pending lawsuit that draws time, energy and attention away from operating that business.

Or maybe it’s simply that the public nature of a trial may impact customer attitudes which might hurt company sales. There seems to be much to gain by resolving a case privately rather than risking ongoing public attention to the dispute. Clearly, the private nature of mediation as compared to a public trial can be a significant benefit when looking at considerations for settlement. And finally, settlements create true closure to disputes whereas litigation in court may only result in lengthy appeals before reaching a final resolution.

Mediators need to help the parties consider all of these factors when measuring what settlements may be worth in the long run. This type of creative thinking can lead to open dialogue and beneficial movement toward mutual dispute resolution.

For thirty years, Scott Zucker has acted as outside legal counsel to a variety of privately held and publicly traded businesses involved in multiple industries. His legal services have ranged from employment, real estate, construction and corporate consulting to representation of companies in the litigation of their financial and business disputes. Scott’s goal is to utilize his legal and business experience to foster the use of Alternative Dispute Resolution to help parties reach resolutions without the time, effort and cost of court litigation. Scott can be reached at [email protected] or 404-364-4626