Litigation is time-consuming, aggravating and expensive. And that’s if you win. If you lose, it is also a business or personal setback. Nonetheless, people being people, there are and will be disagreements and disputes. Some disagreements are resolved quickly and amicably, others just go away, but there are always some that develop into claims and litigation. Because of the time and expense of litigation, business and professional people increasingly are seeking alternative ways to resolve their disputes. For example, many matters are presented to arbitrators who hear the evidence and render decisions. Arbitration is generally viewed as less time-consuming and expensive than litigation, yet it is often just as contentious and it puts the outcome in the hands of an arbitrator, without some of the protections (such as appeals) that are a part of courtroom litigation.

Mediation has existed in one form or another for as long as there have been people and disputes. For ages, if a Jim and a Jack had a dispute, they may well have gone to an Uncle Joe and asked him to help them work it out. More recently, mediation is also being used to help parties to legal, commercial and other disputes resolve their differences. With mediation, there is no decision maker, such as a judge or arbitrator who decides for one party or the other. The parties themselves remain in control of the outcome. The mediator helps them through their negotiations but it is they who agree to a resolution.

The essential components of a mediation are at least two parties and a mediator. The parties, of course, must have a disagreement and a desire to try resolving it through negotiation. There can be more than two parties. The mediator is usually (but not always) trained as a lawyer. Importantly, the parties remain the decision makers.

The classic example of a successful mediation is two sisters who each want an orange, when there is only one orange available. A trained mediator meets with them and helps them identify their individual interests and negotiate about who gets the one available orange. As it turns out, the first sister really wanted just the zest of the orange to bake a cake and the other sister only wanted to eat the pulp. Thus, their interests were not mutually exclusive and the one orange could satisfy both of them. There is no need for a loser and both parties win.

Of course, most disagreements are not quite so simple or as easily resolved, but the essence of the process remains the same. At the beginning of most disputes, each party usually stakes out a position. “I want that orange.” As the mediation progresses, the mediator helps them focus on their interests (to bake a cake or to eat the pulp), and their interests become the basis for a negotiated resolution. A key part of the mediator’s assistance is helping the parties identify the best and worst alternatives to a negotiated solution. These alternatives are part of the context for mediation and shed an important light on its utility.

There are those who say that by agreeing to mediation, one has already given up something. In fact, there is no court or third party who requires you to give up anything in mediation. The parties remain in control, evaluate their interests and alternatives, and then decide what, if anything, they may want to compromise. All that is required is a good faith effort to seek a negotiated solution.

Litigation and arbitration usually result in a winner and a loser. The price of winning (or losing) cannot be measured in dollars and cents alone. Company staff must divert their efforts from company business to the litigation. Staff members sometimes polarize and take sides, especially as the discovery requests, court calls and monthly bills keep on coming. The company also becomes increasingly estranged from its opponent in the litigation. In contrast, mediation can be useful for a wide range of disagreements such as differences between companies that want to continue working with each other, as long as they can get by a particular dispute. Litigation in such a situation could so alienate the parties that neither of them will ever want to work with the other again. Mediation, on the other hand, could help them resolve their dispute without the rancor that could impede their working together in the future. It could do so without the time commitment required by litigation and at a small fraction of the cost. The same would be true of a dispute between a company and its customer, between an employer and an employee, and in many other situations.

Nonetheless, sometimes litigation is really the only effective solution. There may be a strong clash of interests that cannot be compromised, so a third party must decide. In this kind of situation, the parties accept the risk of losing and the fact that victory, if it comes at all, will come at a price. More often, an alternative to litigation, such as mediation, can help the parties achieve an acceptable outcome. Importantly, with mediation there doesn’t have to be a winner and a loser. Both parties have the opportunity to define and achieve their interests in a realistic context. Mediation warrants serious consideration as an alternative to litigation, especially during an economic downturn when money, time and positive relationships are in short supply.

Jim Serritella is a 1971 graduate of the University of Chicago Law School. He has received mediation training from the National Health Lawyers Association and has had advanced mediation training from the CPR Institute for Conflict Prevention and Resolution and the Program on Negotiation at Harvard University. Jim has worked as a consultant on alternative dispute resolution, a party representative in mediations and a mediator for most of his legal career. Jim can be reached at 312/840-7040 or jserritella@burkelaw.com.