Many agreements between friends, partners and family are sealed with only a handshake.  For example, people enter agreements to buy property, start a business, share a timeshare or boat or even to share living expenses.  No matter how informal, these agreements constitute the formation of a business relationship with potentially serious legal consequences.

The failure to discuss details of a business relationship and commit the agreement to writing is a recipe for disaster.  At some point, most such business relationships come to an end.  Without a clear agreement at the beginning of the venture, there is a significant likelihood of conflict at the end of the venture.

First, there may simply be a misunderstanding of how the dissolution of the relationship would unwind, leading to conflict.  Second, the parties may not have considered all of the consequences of the dissolution before it is too late to take appropriate protective measures.  Third, one party may actually take advantage of the lack of a written agreement.  While oral contracts are enforceable in many situations, they are notoriously hard to prove.

It makes sense to create a binding written contract before the formation of the business/agreement.  Rather than do that through an adversarial process (both parties getting attorneys to send drafts of agreements back and forth to each other), the parties should consider mediation.

Business Mediation in Arizona is a confidential, amicable process where a neutral party trained in conflict resolution helps the parties reach agreements.  Mediation is highly successful at helping parties reach agreements to prevent and resolve conflicts.  The parties can leave mediation with a binding agreement, including fully effective Operating Agreements (for businesses).

As Benjamin Franklin once said:  “An ounce of prevention is worth a pound of cure.”  A mediated agreement is that ounce of prevention.  And what if you failed to invest in that ounce of prevention and now you are in conflict?  Yep – mediation is good for that too.

Alona M. Gottfried is a mediator and attorney in Arizona.  If you have questions about mediation, she can be reached at: 480-998-1500 or alona(at)sglawaz.com.  This is a general interest article only and is not intended to be legal advice.  See a legal professional before making legal decisions.

Conflicts and disputes are a routine and expected part of business.  The variables are the time, effort and manner in which the business leader devotes to resolving these issues.  Obviously,

Arizona Business Mediator

the primary goals in resolving the dispute is to put into it the least amount of time, effort and cost and preserve any beneficial relationships.  The best method for accomplishing these goals is mediation.  There are many advantages to mediation over engaging in litigation.  Set forth below are several reasons why mediation should be the first choice for resolving business disputes:

• Quickly resolve pending issues: litigation can often take months or years.  Many times the issues the parties face need to be addressed much faster.  Mediation can be scheduled in a matter of days instead of months.

• Overwhelmingly successful:  Over approximately 85% of all mediated disputes lead to a successful resolution of the conflict.  Both parties are generally pleased with the result as opposed to litigation wherein there is generally a winner and a loser.

• Significant Savings over Litigation: Mediations can take place with each party represented by legal counsel or without.  If lawyers are present, they generally present the issues and act to assist their clients in facilitating a resolution.  If lawyers are not present, the mediator will act as a neutral to assist the parties.  In either case, parties almost always spend significantly less in mediation than litigation.

• Manage your resolution and risk: The resolution of the dispute, if any, will be tailored by the parties.  In a litigation or arbitration situation, there is generally a winner and a loser determined by a judge or arbitrator. Mediation reduces the risk of an all or nothing situation.

• Control the Mediation: The parties will jointly select the mediator and determine what issues the mediator will assist the parties in resolving.  The parties will also select mutually agreeable times to meet with the mediator.

• Address the real problems: In mediation the parties are encouraged to address the causes of their dispute, including personalities, rather than focusing on each side’s legal theories. The result is often that a better, more honest and permanent resolution is reached.

• Informal atmosphere to present all issues: Often, judges, arbitrators and even lawyers are constrained by the time limitations imposed by the litigation or arbitration process.  Rules of evidence and a limited understanding of complex or technical issues may stand in the way of properly presenting the issues for discussion.  The more relaxed mediation environment assures all parties have their opportunity to fully present and explain the issues.

• Confidentiality and non-disclosure: Mediation is private and eliminates exposure of business mistakes, internal issues and helps protect trade secrets.  This can protect a company’s orindividuals good will and reputation.

• Maintain beneficial relationships: A conflict does not necessarily mean the business relationship must end. Many disputes can be resolved amicably by engaging in Mediation.  Engaging in consensus decision can allow the parties to continue their business relationship and eliminate the uncertainty or ambiguities that may be complicating an otherwise successful venture.    Litigation can end otherwise profitable relationships prematurely.  Many business leaders understand the importance of using mediation to build and keep good customer and employee relationships.

Mediation has many benefits for businesses over and above the ones briefly outlined above.  It is a tool used by sophisticated business leaders and individuals to resolve issues and move forward while maintaining relationships for success in the future.

Jared C. Simmons is a mediator and attorney in Arizona.  If you have questions about mediation or business law, Jared can be reached at: 480-998-1500 or jared(at)sglawaz.com.  You can also visit: AZmediator.com.  This is a general interest article only and is not intended to be legal advice.  See a legal professional before making legal decisions.

In this economy, few Arizona businesses can afford the high cost of litigation.  It is generally quite expensive to hire attorney in Phoenix.  Further, a lost lawsuit can result in a big judgment against a business.  The person or entity that sued your company can take steps to collect that judgment.  Litigation also taxes your business’s time and resources.  For example, you will need employees to pull and copy document demanded by the other party.  Employees may also have to sit for depositions or testify at trial.  Litigation can also have another adverse impact as, if your company is found to be at fault for some wrong-doing, the business’s reputation could suffer.  As a result, you could lose business.

But, what is the answer?  Disputes in business will happen.  Another company may not honor a contract.  An employee may feel harassed.  Someone could claim an injury on your property.

One option is to mediate instead of litigate.  Mediation is a method to resolve conflict that is used all over the world.  With mediation, parties in dispute meet with a neutral third party trained in conflict resolution (a mediator) to try to resolve the dispute out of Court.  With mediation, the parties choose the outcome of the dispute – no Court or other third party decides the outcome. Mediation can take place either before or after a lawsuit is initiated.  Most mediations are successful.  Some place the success rate of mediation at around 85 percent.  The result of a successful mediation is a binding agreement that resolves the conflict and, in some cases, even restores damaged relationships.

Companies like mediation because is it a lot less expensive and disruptive than litigation.  Mediation can be completed in one day, whereas litigation can take years.  You can have attorneys at mediation, but you do not need to.  Even if you use attorneys, the attorney bills will be significantly lower because mediation is so much less time consuming.

Further, mediation is confidential, so reputations remain intact and settlements are kept private unless the parties jointly choose to reveal that information.  Choosing mediation allows companies to operate from a position of strength and keep their valuable resources intact.

If your business has a conflict, consider suggesting to the other party to sit down with a mutually agreeable mediator before suffering the damage of litigation.

Alona M. Gottfried is a mediator and attorney in Arizona.  If you have questions about mediation, she can be reached at: 480-998-1500.  This is a general interest article only and is not intended to be legal advice.  See a legal professional before making legal decisions.

Simmons & Gottfried, PLLC.

a Professional Limited Liability Company

3977 N. 7th Street, Suite 340

Phoenix, AZ  85014-0001

Today’s business world moves very quickly and success depends upon establishing and maintaining successful working relationships.  The difference between success and failure can often be simply communicating and resolving disputes amicably before the relationships are forever damaged.  Mediation can successfully and inexpensively resolve disputes and open lines of communication that foster better business relationships.
Some of the benefits of Mediation in Arizona over litigation include:

• A “win-win” result is often achieved because the parties develop the agreement together.
• New businesses can move forward more quickly as the principals have clear, specific agreement about job descriptions, responsibilities, goals and objectives.
• Businesses continue to expand and succeed without the burden of unresolved problems or unclear agreements.
• The parties’ ability to preserve an existing business relationship is enhanced.
• It is less costly and less stressful.
• A final resolution is usually reached more quickly with the parties controlling the outcome.
• It provides a more confidential, informal, convenient and comfortable atmosphere in which to address the decisions that need to be made.

Mediation effectively resolves a variety of business-related matters including:
Negotiating an ownership and/or partnership agreement when forming a new business or professional practice.

• Resolving disputes between employers and employees, and between principals of an existing business or practice .
• Renegotiating aspects of an existing ownership and/or partnership agreement.
• Negotiating an amicable dissolution of an existing business arrangement when dissolution is the desired outcome or a potential buyout of another owner.
• Resolving conflicts between businesses.
• Resolving personnel disputes.

Business Succession Planning, structuring and agreement to transfer family business leadership and ownership from one generation to another.

The results are proven that when businesses engage in mediation and reach an agreement they are more likely to resolve disputes successfully in the future without litigation.

Simmons & Gottfried
a Professional Limited Liability Company
3877 N Seventh St. Suite 340
Phoenix, AZ 85014-0001
Phone: 480-998-1500
Fax:   480-998-6074