Business owners and managers familiar with the court litigation system understand that high litigation costs and long delays make it difficult and expensive to resolve business disputes in court. They also understand that most civil cases that go to court are settled before trial. They are solved after spending considerable amount of time and money in the complex pre-trial phase, but just in time to avoid the risk of trial. Mediation and commercial arbitration provide superior solutions that help in resolving business disputes. Mediation puts the parties immediately in control of the situation and helps them get desirable outcomes without expending vast resources on litigation procedures (Berg, Permanent Court of Arbitration. Internationalshow more contentWith increased regularity, businesses have chosen alternative dispute resolution (ADR) procedures of mediation and arbitration instead of the traditional litigation system for resolving legal disputes. Businesses have brought in qualified mediators in the dispute resolution process, to help them come up with preferable resolutions instead of spending excessive resources on pre-trial court litigation processes. In case businesses anticipate disputes that might not be resolved through mediation, they agree at the time of contract signing, to present future disputes to private arbitration.
The most widely accepted reason favoring commercial arbitration or alternative dispute resolution is the favorable cost of the arbitral process in comparison to traditional litigation costs. The cost of arbitration, when managed efficiently, can be a fraction of the cost of litigation. In a study that compared litigation and arbitration of employment disputes, empirical data indicated that arbitrations were significantly more efficient than litigation, in terms of time management. Several judges have spoken out about the court crisis, including Kevin S. Burke, Chief Judge of the Minnesotas Fourth Judicial District (Antonio Buti, 2001).
Modern business dealings involve increasing multifaceted interactions coupled with many technicalGet Access
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