Texan entrepreneurs and business owners like you have made use of contracts before. Most of the time, these contracts go without a hitch. But in some cases, contracts go south. If you end up in a contract dispute, what can you do?
There are many different ways to handle these disputes. Litigation is one. Arbitration and mediation are two others. They often get mistaken for each other, but they are two distinct processes.
Using mediation and arbitration to keep connections
FINRA looks at both arbitration and mediation as viable tactics for handling disputes. Litigation is off the table for now. It is a costly option that may also result in burned bridges. You do not want to risk burning any bridges in your line of work. A business is all about its connections. You want to keep as many of yours as possible.
Mediation vs arbitration
So you can turn to arbitration or mediation instead. Both of these options allow you to solve your problems outside of court. Both provide a third party whose job is to help you find a solution to your problems. Both cost less than litigation. Both allow you to save business relationships.
They differ because an arbitrator hands down a judgment. A mediator is only there to listen to all sides. They can propose solutions. They can make suggestions. But the final decision is not up to them. With arbitration, the arbitrator makes a decision based on hearing everyone’s information.
Your best available option differs depending on your current situation. For some, mediation is best. For others, arbitration is what they need.