Mediation vs Arbitration

Mediation vs Arbitration

Anyone involved in the building, construction and real estate environment knows how expensive conflict and disputes can be, especially if the conflict is driven by anger.

A sub-contractor fails to meet a deadline and blames the main-contractor for causing the delay. The main-contractor reacts angrily and a cycle of accusations and counter-accusations follows, culminating in conflict that can be difficult to contain. In anger they turn to their legal representatives who advise them not to talk to each other, as this may compromise their legal positions. The effect of this is that parties rarely get the opportunity to resolve the conflict themselves, and leave it to their legal representatives to negotiate a settlement on their behalf. The problem with this is that their legal representatives are not trained to explore their clients’ underlying interests and concerns, but rather enquire as to whether their clients have winnable cases or not.

Settlements, in the absence of exploring underlying interests and concerns, are however far from ideal. They tend to produce narrow, competitive win-lose outcomes that plant the seed for future conflict and harm the business relationship between the parties. Naturally, the outcome from a cost perspective is even worse if no settlement is reached and the matter goes to court for adjudication. But there is now a third and more effective way to resolve disputes in the building, construction and real estate industries; known as commercial mediation. To continue reading click here…




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