Mediation vs Litigation - Pros And Cons


As it is with all disputes in life, there is more than one way to settle the legal ones. No matter if it’s a business dispute or a family one such as divorce, they don’t have to end up in front of the judge if there isn’t a good reason for this. The courtroom is not the ultimate destination for this process, especially with exorbitant litigation fees, lengthy trials, and overburdened courts. The choice that’s becoming increasingly popular is the one of mediation due to its swift resolutions, cost efficiency and tendency to be less deleterious. Nevertheless, litigation which is just a legal term for a lawsuit is in many cases still the right choice. Since things are not even close to black and white, let’s give them a closer look and find their pros and cons. 

Litigation 

If you take this road, everything begins with an initiation of a lawsuit with one party filing the documents. These documents are served to the other party who is provided with an opportunity to file an answer. What follows is a process called discovery, through which information and data about the parties’ conduct and finances are gathered. This process is also initiated and managed by lawyers and it may be informal in the form of a voluntary document exchange or formal as a deposition. In most cases, an agreement can be reached at this stage of the proceedings. The process of reaching an agreement is, needless to say, also conducted by lawyers who draft it for approval by the court. If the agreement isn’t reached that leads to a trial or hearing where the matter is decided by a judge. 

Mediation 

Should you opt for this method, you will be lead through the process by a mediator whose job is to facilitate an understanding on the position of each party on various matters. This person doesn’t represent either party and tries to lead both to a negotiated agreement regarding each issue without making or forcing any decisions. Concerns, needs, and interests are facilitated by the mediator but they’re identified and negotiated directly by the parties and both are encouraged to review the agreements at each stage and the conclusion. Information and data are gathered solely by voluntary disclosure to the mediator and shared with lawyers upon authorization while outside professionals (therapists, accountants, etc.) are consulted only if needed. In the end, the Memorandum of Agreement is drawn up by the mediator and used as a preparation for the settlement agreement. If there is no agreement or if it’s only partially reached the result is the same as above - next stop is a trial or hearing. 

Why Should You Try Mediation? 

First of all, the whole process and its outcome are private and they’re not available as a public record, which can sometimes be crucial for saving face. Second, not only will the mediation save you the money for court expenses, but it will also save you the time since it is usually conducted in a timely manner. And third, it is a perfect opportunity to test your strengths and theories regarding the case since each party is provided with an opportunity to describe the dispute from his/her perspective. This is the process that takes place in a non-confrontational setting, allowing the parties to truly hear each other and participate actively. This means that the control is completely in your hands and you can walk away at any moment. There is a big chance that your relationship with the other party will be preserved, which is usually not the case after a lawsuit

And Why You Shouldn't? 

First of all, it may be in your interest to have a public disclosure, especially if a dispute is of a business nature and it’s a question of your reputation. Furthermore, business disputes often require expert knowledge you don’t possess and having or not having competent Business lawyers at your side may decide the outcome. Second, if you or the other party are not willing to cooperate and compromise, the mediation will not save you the time and therefore it won’t save you the money, either. You can both initially agree top mediate but that doesn’t mean you’ll get along and agree to a resolution. Besides, the mediator can be an inexperienced one same as the lawyer. And third, some issues of law simply need to be ruled on because the subject of the dispute may carry great emotional attachment for each party. This strict courtroom setting where everything goes by the book is necessary when parties are under a great emotional strain and can’t think clearly. 

If you’ve expected the simple answer we’ve warned you at the beginning that things are not always black and white during the legal process. Now that you know the pros and cons you can reach the best decision by the careful assessment of your emotional state and the amount of knowledge you possess regarding the subject of the dispute. 

Author Biography: Daniel Brown is a law graduate and a passionate blogger from Sydney. His areas of interest are alternative dispute resolution and it's applicability in different fields of law, IP law and resolution of disputes arising from intellectual property infringement and commerce law.


I hope you enjoyed this article about business law and the pros & cons of mediation or litigation.

Interested in more articles about business law and legal strategy?

Read My Posts:

- Tips To Avoid Business Litigation 

- How To Keep The Law On The Side Of Your Business 

- Help Your Startup Cut Through The Excess Legal Red Tape

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