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Evaluating The Various Methods Of Commercial Dispute Resolution

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In all instances of commercial disputes, it is beneficial for both parties involved to seek to resolve the dispute at the most appropriate and earliest opportunity. Where possible, this should also be outside of the courtroom in order to reduce the financial and personal costs involved in a complex and expensive court case.

Commercial litigation in Gloucester, and throughout the rest of Australia, encompasses various methods of commercial dispute resolution, each with very unique aspects. Therefore, if you are involved in a commercial dispute, it is important to seek the advice of an experienced lawyer, who can help you make an informed decision on the best course of action for your specific situation.

Alternative Dispute Resolution.

Alternative Dispute Resolution (ADR) consists of consensual and assisted negotiations between the disputing parties. Mediation is the most common form of ADR and involves a discussion with a neutral and independent mediator who is appointed by both parties to help facilitate the discussion towards an eventual resolution.

Advantages

ADR can be much faster and cheaper than litigation (taking the dispute to court) and can help preserve an ongoing commercial relationship, by producing flexible and ongoing solutions which are provided by the parties themselves. For this reason, Australian courts now actively encourage parties to attempt settlement through ADR before commencing proceedings in court, and will take into account the unwillingness of a party to take part in a form of ADR, when deciding the outcome of a case.

Disadvantages

It is important to note that ADR involves a non-binding outcome that cannot be enforced by a court; a process that relies upon the good faith and cooperation of both parties. It is important to therefore consider whether this form of commercial dispute resolution is appropriate for your specific situation, or whether it may only increase the costs and time involved in your dispute resolution process.

Arbitration.

Arbitration in commercial dispute resolution is very similar to court proceedings, however the process is held in private and can follow procedures to be decided by the arbitrator in agreement with the parties. As in mediation, arbitration involves an independent third party, however in this method of resolution, the role of the arbitrator is to reach a binding determination of the parties dispute.

Advantages

One of the main advantages of arbitration is the ability for both parties to choose the arbitrator. This allows the appointment of someone with an industry background and specialist expertise on the issues at hand. In Australia, commercial arbitration has become the preferred procedure for parties seeking a binding and importantly, confidential determination of their dispute and an alternative to Court based litigation.

Disadvantages

Arbitration can involve as much time and expense as traditional court litigation. Costs such as arbitrators’ fees and the hire of arbitration facilities are expensive and will have to be paid in addition to legal costs. Furthemore, as the chosen arbitrator is acting in a judicial capacity and their determination will become binding on both parties, this method of dispute resolution can lead to unsatisfactory decisions for some parties and make it difficult for the parties to continue to work together in a commercial nature.

Litigation.

Commercial litigation is the traditional form of dispute resolution and involves using the courts. Other than the expensive financial costs involved, court proceedings are intrinsically formal and the procedures are fairly inflexible. Due to these considerations, Australian courts actively encourage all businesses to consider, and in many cases in fact, attempt the other options available for resolving disputes before bringing the matter to a court room.

However, in many cases commercial disputes is the only and best option available to resolve commercial disputes. An experienced lawyer can ensure that your interests and rights are protected throughout the process, and a careful court process will ensure your peace of mind in knowing that the dispute has been resolved on the basis of all available evidence through the decision of an impartial judge.

All commercial disputes are unique in nature and involve important considerations of the nature of both the business and personal relationship between the parties, the business in question and the likelihood of the commercial relationship between the parties being salvaged through a dispute resolution process. It is therefore important to seek the advice of an experienced commercial lawyer, who can help you make the best possible decision regarding which resolution process will best protect your ongoing relationships and your business.