Benefits of mediation in commercial real estate disputes

| Jul 25, 2019 | Uncategorized

Whether due to a lease disagreement, breach of contract or other conflict, commercial real estate buyers, sellers, developers and more may find themselves facing a dispute. When you are unable to reach a solution, you may fear the daunting process of litigation.

However, South Dakota commercial real estate disputes can often benefit from a resolution through mediation. Mediation is an alternative dispute resolution (ADR) method, in which both parties and a neutral mediator attempt to come to an agreeable solution.

Mediation offers many advantages, including:

Saving time and money

Litigation can be a lengthy process from the start. Mediation is typically quicker both in arranging the sessions and coming to a conclusion. Additionally, it has the potential to save money when both parties reach a resolution and can bypass the traditionally costly court process.

Direct involvement in the process

Together, both parties agree on a neutral, third-party mediator to facilitate the discussions. Typically, you may select a mediator with a substantial background in commercial real estate disputes to encourage creative, knowledgeable solutions that both parties can agree to.

Additionally, while both parties typically have little to no control over the decision of a judge and/or jury, they have direct involvement and even control over the outcome in mediation. You may reach a solution that would be unlikely in a courtroom yet eases the tension and satisfies both parties. You also may choose not to come to an agreement. While the mediator facilitates the discussion, they cannot force a binding solution. When you cannot reach an agreement, you may choose to go to court.

Confidentiality of the discussion and decision

Litigation is a highly public process. Like other ADR methods, mediation remains private throughout the course of the dispute. You may not want anyone to gain access to such sensitive information. This can also encourage more open communication between both parties.

The potential to preserve the relationship

While not always true, litigation can leave a bitter taste, making a continued business relationship unlikely or strained. With its collaborative and more informal nature, mediation can increase the likelihood of preserving the working relationship between both parties.

In some disputes, litigation may be the preferred option to seek the definitive ruling of a judge. However, many buyers and sellers across Sioux Falls may benefit from mediation’s creative and voluntary process. Discuss your options with an attorney to learn how mediation could benefit your interests.