These days, it seems like the commercial real estate disputes might never end. After the pandemic, some companies will never need as much space as before. Or, at best, they might take years to work their way back into needing it. As a landlord, you may see the rent rates drop on properties that were sure performers in the past.
With everything so fraught, other real estate disputes are also on the rise. Will you be spending the next year in court? Is there a way to avoid that hassle?
How can mediation and arbitration help?
In the vast majority of cases, you will save time and money by using mediation or arbitration. Unlike court, these alternative dispute resolution methods can be accessed right away – within weeks or months of the dispute arising. They both generally take less time than a court trial, with less of a lag between the proceedings and the answers you need.
Mediation is the simplest and can be the least expensive. It involves hiring a neutral person that both parties agree upon. That neutral person, the mediator, is not there to rule for one side or the other. He or she is there to facilitate productive dialog and help the parties reach a resolution they can both live with.
Because the solution is one you both agree upon, both parties are more likely to abide by the agreement. Mediation typically has no rules of evidence or procedural hurdles. It can be confidential so that what you say in mediation can’t be used against you later if you have to go to court.
You can bring an attorney to represent you in most mediations. If your dispute is relatively small-dollar, you may wish to consult a lawyer ahead of time but not bring them along to the mediation, as long as you believe there’s a good chance you can resolve the dispute without representation.
Arbitration is a simplified form of trial that is overseen by a neutral arbitrator instead of a judge. Scheduling is typically much quicker than it would be going to court.
One advantage to the process is that you can agree to make it binding. That means that the arbitrator’s decision is final, and no party can appeal or go to court later. However, you can also agree that it will not be binding.
The arbitrator, much like a judge, will generally rule in favor of one party over the other. However, the arbitrator may be able to develop creative solutions that wouldn’t be available from a court.
Talk to your real estate attorney about resolving disputes through mediation or arbitration. It could be simpler and less costly.