NFIB

When Minds Can't Meet: Conflict Resolution Part I
03/ 28/ 2002


Because business involves close ongoing associations between sellers and buyers, and between business associates, it is inevitable that disagreements and disputes will arise from time to time. There are logical steps to take when working out such disagreements, and in today's and next week's Workshops, Jeffrey Moses outlines these steps.

First, both parties need to come to a clear understanding of the issues involved in the dispute. When emotions flare, logic disappears so communication must be based on a mutual desire to work out the problem as reasonably as possible. If one or both parties cannot enter into unemotional, rational discussions, reaching a mutually desirable solution is unlikely.

When both parties come to the table willing to speak reasonably, each should have their say without interruption by the other. Both parties should be prepared to lay out exactly why they feel as they do, based on evidence from previous contracts or agreements, or upon stated laws or codes. Of course, the situation may have changed in any number of ways since a former agreement was reached. These changes or developments should be detailed and understood by both parties, because often they are the cause of the disagreement. After each party has the chance to lay out their case, a solution should be sought that is amenable to both.

Disagreements come in all shapes and sizes, with each requiring a special way of handling to reach resolution. In every type, however, the initial steps of resolution should be to resolve problems amicably, without aggressive threats or actions. If the parties know each other well, or are business associates, it is in the short- and long-term interest of both to maintain rapport and avoid dissension throughout the process.

When agreement is reached, it is wise to draw up a letter, formal document, or contract describing the resolution in detail. Attorneys may be consulted by both parties to make sure that the final document is accurate. And the document should be signed by both parties, with both signatures witnessed.

When two parties can't come to a meeting of minds about a particular situation, or can't reach a mutually satisfactory agreement in a negotiation, they may need to bring in a mediator or arbitrator. Mediation and arbitration involve using a third party to help remedy a deadlock. When mediation is undertaken, neither of the involved parties are bound to accept the recommendation. In arbitration, however, both parties are legally obligated to abide by the arbitrator's decision.

It's always beneficial for arguments or disputes involving your business to be handled as inexpensively, efficiently, quickly, and privately as possible. Going to court is usually considered the last resort because of possible expenses involved: attorney's fees are steep, and the "meter" will be running throughout initial meetings, letters back and forth between parties, briefings, depositions, and court time. Mediation and arbitration are almost always less expensive than going to court, even when attorneys are used by the disputing parties. Both can become costly, however, depending on the length of time required for attorneys, mediators, and arbitrators to be on the job. The mediator/arbitrator is frequently asked to decide how the costs of arbitration are to be divided between negotiating parties.

Next week's Workshop will continue the discussion about mediation and arbitration in conflict resolution.

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5.10.00

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