When Is Litigation Better Than Mediation In A Commercial Case?

For the last thirty years, commercial disputes have increasingly been resolved through mediation, which occurs when two opposing parties attempt to resolve their dispute and come to an agreement with the help of a facilitator, often a retired judge. However, some plaintiffs may not realize that mediation is not required as a step in the legal process and that sometimes, resolving a commercial case through litigation is preferable to mediation.

Let’s take a closer look at a few of the reasons why litigation might be more beneficial to a plaintiff than mediation.

Binding Results

The mediation process is non-binding, by its very nature. That means that the final outcome of mediation requires both parties to act in good faith and abide by the terms of the agreement they have reached — something you can’t count on in every case. The results of litigation, however, are legally binding, and there are serious repercussions should one of the parties not abide by the court’s ruling. When one party in a dispute cannot be trusted to abide by the non-binding terms of a mediated settlement, litigation may be the only path to a resolution.

Public Record

Mediation is confidential, but anything that occurs in court is a matter of public record. There are many reasons why it might be beneficial to have a verdict on the record. First, the facts will be spelled out, word for word, on the pages of court documents. This makes it more difficult for anyone to spread rumors, innuendo, or outright falsehoods regarding your case since you can refute any claims by citing the public record. Furthermore, pursuing litigation can speak to the strength of your convictions. It sends a message to others that you are willing to pursue your rights in court, which may help you avoid other costly disputes in the future.

Precedent

Anytime a court renders a judgment, that judgment becomes part of legal precedent. Precedent becomes what is known as case law, so those future litigants can cite the decision in your case when making their arguments. This could also benefit you personally if you believe that you could be subject to similar future disputes.

Full Participation of Opposing Party

When a dispute goes to court, both parties’ full participation is required. This is not true for mediation. Mediation does not work if one of the two parties remains noncommittal about coming to a mutually beneficial agreement. If it seems like the opposing side isn’t approaching mediation in a way that serves both parties’ interests, or if you don’t believe that you yourself are capable of approaching mediation in good faith, then litigation is preferable.

Showcasing Evidence

In order to present evidence in court, the court must approve it beforehand, and there are strict protocols in place to ensure that this evidence is reliable. If you know that your case is a strong one, then pursuing a resolution through litigation may give you a clear advantage. Unlike litigation, mediation leaves room for speculation, as evidence will not have been tested in the same way.

Equality Under the Law

When you litigate a dispute in a court of law, you can expect that both you and the opposing side will be treated equally under the law, and that you will each have ample and equal opportunity to make your case before the

judge or jury. Conversely, the two opposing sides may not approach mediation on equal footing. Pre-existing relationships and unequal resources could affect the outcome of mediation more than they could a court trial.

Contact a Commercial Litigation Attorney Today

If you have questions about resolving a dispute through litigation or mediation, contact the commercial litigator lawyers at Mullen Holland & Cooper today for a free consultation.