How to Resolve Business Disputes?

There are several ways to resolve a business dispute in New York. We can divide them all into out-of-court means of resolution and litigation. The out-of-court tools include negotiation, mediation, and arbitration. You don’t need to try all of them one by one. It’s rather about considering and weighing their pros and cons in your case. The best will be the one that has better chances to bring you the solution you want.  

Negotiation

Negotiation is by far the best business dispute resolution. It’s always better to resolve a business dispute in New York and elsewhere by negotiation. Any business relations start and develop via negotiation. So, it is a natural way to deal with any problem or misunderstanding. Negotiation usually does the job, provided there is goodwill and intention to reach a just agreement on both sides.

The key is in understanding the other side’s needs and being willing to make necessary compromises to reach an agreement that works for both parties to the dispute. As a rule, if there is still mutual trust and respect between the business partners, negotiation is usually enough to resolve most disputes. Unfortunately, however, quite often, conflicts arise because of mistrust or suspicion of unfair business practices. In this case, negotiation may fail, and the parties will have to resort to other means.

Mediation

Mediation is one such means. It is a conversation between the parties in a dispute led by a neutral mediator. The whole process of mediation is relatively informal, and its decision is not binding. However, presuming that both parties trust and respect each other and the mediator, there are chances that some obstacles that were not solved in direct negotiation can be solved there.

Parties can choose any person (independent third party) to be their mediator. Some mediators have relevant previous experience to perform this task, and others don’t. For example, you can try to hire a retired judge as your mediator. However, the former judge’s hourly rate can be pretty high. On the other hand, if you choose somebody without the necessary experience, the results could be disappointing.

In mediation, there is always a risk that one of the parties may withdraw or will not comply with the decision. Then the other party will have to look for other means of resolution.

Arbitration

Arbitration is another way of out-of-court business disputes resolution. There are arbitration clauses in different contracts: consumer contracts, health insurance, employment, etc. By accepting the arbitration clause, the parties agree to resolve all disputes through arbitration. However, even if you don’t have an arbitration clause in your contract, you can try to resolve your business dispute in New York via arbitration.

Suppose the parties decide to resolve their dispute by way of arbitration. In that case, they submit their dispute to the arbitrator(s) they choose, who will consider all the arguments and evidence, listen to both sides, and makes a decision. Arbitration is less formal than litigation but more structured and complex than mediation. It can be very complicated, including special arrangements on selecting the arbitrators, where the arbitration takes place, who will pay the attorneys’ fees, etc. Usually, the final arbitration decision is binding.

If the decision is binding, a party can challenge it in court only in strictly limited cases. Mostly in case of fraud or improper use of power. If the decision is nonbinding, then either side can refuse to comply with it. In this case, a party can go to court and try to solve the dispute via litigation.

Litigation

The ultimate means of business dispute resolution is litigation. It is important to note that any enforcement of a binding decision goes via the court. So be it in a case of enforcing a binding arbitration decision or judgment. Thus, in cases where the stakes are high, or there is a reasonable concern that the other party won’t voluntarily comply with the binding decision, the plaintiff often prefers going to court.

The trial is an adversary proceeding, i. e. a kind of competition of lawyers presenting the claims, arguments, and evidence to win the case. The court conducts a trial and makes its decision. There may be post-trial proceedings and an appeal. Litigation is a complex, strictly regulated process that requires the constant participation of a qualified attorney.

Based in the Financial District of New York City, our law firm represents clients in a broad range of commercial litigation matters in New York courts. We are ready to take any case to trial and manage litigation at every stage of the process. So get in touch with us, and we will be happy to help you with any business dispute in New York and contribute to its successful solution.