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Dispute Resolution

What are the Alternatives?

Over the past several years, a new phrase has been bantered about by lawyers and business people.  That term is “Alternative Dispute Resolution” or ADR as it is often called.  So what is this ADR and how does it affect you?  Over the next three articles, we will look at ADR, as well as traditional dispute resolution forums, in an effort to explain the benefits and risks of each.

Initially, it is helpful to identify the various mediums commonly utilized to resolve disputes.  In this regard, it is easiest to view these options in terms of a spectrum.  On one end of the spectrum we have the options which allow for the most self-determination by the parties to the dispute.  On the other end of the spectrum we have the options through which the disputants relinquish control over the resolution process to a third party.  In such a case, the third party imposes a resolution on the disputants.

The following is a list of the most common types of dispute resolution, starting on the side of the spectrum which allows for the greatest self-determination.

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Mediation Alternative

Last we reviewed the various alternatives for dispute resolution.  These alternatives included:  1) One on One Negotiations; 2) Mediation; 3) Non-Binding Arbitration; 4) Binding Arbitration; 5) Court Trial, also referred to as a Bench Trial; and 6) Jury Trial.

Now we will examine mediation in more detail.  In reading the following, it should be noted that mediation is an extremely valuable and highly successful alternative for dispute resolution.  For this reason, you and your clients are strongly encouraged to use mediation whenever a legal dispute arises which cannot be resolved by way of “One on One Negotiations.”

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Binding Arbitration Alternative

Over the last two articles, we have reviewed various alternatives for dispute resolution.  These alternatives included:  1) One on One Negotiations; 2) Mediation; 3) Non-Binding Arbitration; 4) Binding Arbitration; 5) Court or Bench Trial; and 6) Jury Trial.  Last, we focused on Mediation and now we will examine Binding Arbitration in more detail.

By way of review, arbitration is a process through which the disputants present their cases to a third party.  The third party is called an arbitrator.  The arbitrator can be an attorney, retired judge, or any other person who has some reasonable knowledge of the subject matter in dispute.  The process can be extremely formal, or entirely relaxed with no real ground-rules.

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Finding a Better Resolution

Despite the best of intentions and efforts, there is always a risk that a dispute will arise between the buyers and sellers in a real estate transaction.  Misunderstandings, differing expectations, along with the substantial emotional and economic elements of such transactions, are among the many factors which lead to these disputes.

The sad truth is that many of these disputes escalate into lawsuits, the costs of which are frequently more than the amount over which the parties are battling.  Of greater personal concern to Realtors is the fact that once the disputes have escalated, they are frequently targeted as defendants by the attorneys of the actual disputants.

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