Wilmington NC Business Law – Arbitration, Mediation: Alternative Dispute Resolution Attorney
Alternative Dispute Resolution and North Carolina Businesses
Increasingly, businesses are including alternative dispute resolution (ADR) clauses in standard business-to-business and consumer contracts. Even where there is no mandatory ADR clause, businesses will often opt for ADR procedures to resolve disputes while keeping court and legal costs to a minimum. At Kerner Law Firm, PLLC, we effectively translate our business law and litigation expertise into powerful ADR advocacy for all of our business clients, no matter the issue.
Mediation
Many standard contracts contain ADR clauses which require the parties to mediate their dispute before moving to binding arbitration or litigation.
At the mediation, all parties gather in one room, and the mediation usually begins with a plaintiff's presentation, followed by a defense presentation. Then the mediator may initiate a brief question and answer session in an attempt to more fully understand the position, goals, and points of compromise of each party.
At this point, the parties will typically separate, moving to separate rooms where they will “caucus” with their attorneys. The mediator then begins a period of shuttle diplomacy, asking further questions and probing each party's goals and values, while assessing their willingness to compromise. Here, the experience of the mediator with the law and knowledge of the industry involved in the dispute becomes invaluable. The mediator tries to drive both parties into a settlement range that the mediator believes fair and reasonable given the facts, the law, and the industry.
Arbitration
Two sets of law govern arbitration in North Carolina: the Federal Arbitration Act (9 U.S.C. §1, et seq.), and the North Carolina Revised Uniform Arbitration Act, set forth at N.C. Gen. Stats. §1-569.1, et seq. Whether you are required to, or have the option to choose to submit your business dispute to alternative dispute resolution by arbitration, you need a North Carolina lawyer who knows both sets of laws and how they interact with each other.
Arbitrations more closely resemble court proceedings than do mediations. Arbitration is strictly a matter of contract between the two parties, but public policy favors arbitration, so courts will generally resolve doubts about the applicability of arbitration provisions in favor of arbitration. Arbitration is similar to a court proceeding, but with less formality and, in theory at least, less cost and therefore, less financial risk to the parties.
Once referred to arbitration, the parties to the dispute select an arbitrator or arbitrators following the procedures established in their contract, frequently relying on rules promulgated by the American Arbitration Association, FINRA, or other regulatory organization. As a general rule, arbitration allows for more limited discovery than traditional state and federal discovery rules, without being bound by standard rules of evidence. This allows for a cheaper and simultaneously more effective discovery process.
Parties may appeal the award of the arbitrator only under very limited circumstances, unless both parties have agreed to non-binding arbitration.
Whether to have an arbitration clause in a contract should be discussed on a deal-by-deal basis. The parties may waive rights in arbitration (e.g. punitive damages and/or jury trial) which could favor one side or the other. Before making that decision, you need to consult your attorney to make sure that the decision favors you, to the extent possible. Similarly, arbitration costs more in the way of setup fees that a normal litigation case does (e.g. the case administration and arbitrator fees are often higher than the court costs in a typical lawsuit). If the deal is very small, it may be more expedient not to include an arbitration clause for the simple fact that filing a lawsuit in that situation might be less costly for the client.
North Carolina alternative dispute resolution lawyers
If your business faces alternative dispute resolution of any kind in North Carolina, work with a business law attorney in Wilmington who understands the law, your industry, and ADR procedures and requirements. Contact Kerner Law Firm, PLLC today to arrange an initial consultation on any business-related matter. CALL 910-09-7241, or EMAIL at info@kernerlawfirm.com
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