Know When to Use Specific ADR Methods

Many owners are using “alternative dispute resolution” (ADR) methods, including mediation and arbitration, to resolve their differences with tenants out of court. In mediation, a single mediator facilitates a discussion between the parties. With arbitration, the dispute is heard by either one arbitrator or a panel of three arbitrators. But mediation and arbitration apply to different situations and it’s important to know which to choose when dealing with your tenants. It’ll depend upon the circumstances of the case.

For example, when an owner and a tenant are certain they disagree on a single, clear-cut issue—such as whether the owner has grounds to force the tenant to vacate the premises—arbitration may be the best place to start. Mediation is most useful for helping parties identify the crux of their feud and isn’t necessary if you already know what the controversy is.

Also, if the parties involved in mediation don’t reach a mutually acceptable resolution, the conflict will remain unsettled. Arbitrators, on the other hand, necessarily render a decision. Whether that decision is appealable depends on the rules of the organization that conducts the arbitration.

When you’re involved in a conflict that you’d like to resolve using ADR instead of the court system, ask your attorney about whether mediation, arbitration, or some other method applies to your case. Look for tips on ways to minimize ADR costs in a future issue of the Insider.