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Whether you own a business or run a household, inevitably you will find yourself in a dispute.  A contractor's work is incomplete or unsatisfactory, or a property owner refuses to pay for work performed.  A financial advisor or broker fails to properly advise and invest in accordance with your needs or instructions.  A nursing home resident and family have concerns about the quality of care being given, or a resident's family fails to honor their agreement to pay timely for the care and services that an aging parent is receiving.

How are—or should—these disputes be resolved?  In our system of civil justice, there are essentially three ways to accomplish this, all of which avoid a "duel at 20 paces," which did not work out very well for Alexander Hamilton in 1804.

Let’s examine the three ways.

Lawsuits

This is what courts are for.  A judge or a jury is responsible for adjudicating your case, after hearing the facts, and applying the law. In disputes involving modest amounts of money, a small claims option may be available for a low filing fee, and you can even represent yourself.  In fact, the judges adjudicating small claims often prefer not to have lawyers present.

In larger matters, the assistance of an attorney is both necessary and prudent.  As litigating lawyers representing you, we undertake a dual responsibility. We act as your advocate, shaping, presenting and arguing your case both to the opposing counsel and to the court. But we also must be an objective evaluator of your position and advise you of the risks and exposure you face.

Who pays for the attorney you hire?  In almost every case, you do. This is the so-called "American rule." One of two key exceptions might apply to your case. First, a state or federal statute might allow for a shift of the burden of attorney's fees to the losing party. Certain civil rights cases, or wage disputes under the Fair Labor Standards Act or the New York Labor Law, are key examples.  Second, if you are involved in a contract dispute, the contract itself could provide for the prevailing party to recover attorneys’ fees, at least with respect to issues on which that party does succeed.  Even in these cases, however, you should be prepared to bear your own expenses, as an award of attorney’s fees may still be in the judge’s discretion, and is often the first item compromised in any settlement.

Lawsuits vary widely in length and expense, depending on the complexity of the issues and amount of money involved. They provide for a thorough exploration and complete resolution of the dispute, with options for appeal if the outcome at the trial court level is perceived to be flawed.

Even if litigation is commenced to resolve a dispute, most lawsuits end in a compromise settlement at some point during the process.  Based on our many years of experience, we have found that the facts of most cases are not black and white, but rather some shade of gray.  This calls for a reasonable compromise, once both sides have come to appreciate the strengths and weaknesses of their positions.  Settlement has been appropriately described as the parties reaching “mutually agreeable levels of dissatisfaction.”

Arbitration

Arbitration is an alternative dispute resolution method that allows the parties to choose a neutral person to resolve the dispute, with an outcome that is binding on the parties.  The arbitrator, or panel of arbitrators, is selected by agreement of the parties, and can be chosen because of their expertise or familiarity with the particular industry or area of law involved.  The arbitrators do not necessarily need to be lawyers.  The arbitration hearing is typically held in a conference room setting, and may take place on a single day, continuous days, or on multiple days scheduled by mutual agreement of the arbitrator and the parties.

Parties to a contract may agree in the contract itself that any dispute arising out of the contract can be settled only by arbitration, rather than resorting to a lawsuit in court.  This “agreement to arbitrate” now routinely appears in the “small print” in consumer contracts presented to individuals by vendors, contractors and service providers—and you won’t be allowed to strike out or waive that agreement.

The law provides mechanisms to enforce the arbitration agreement.  A judge will refuse to hear a case that the parties have contractually agreed to arbitrate and will enforce an arbitration award once it is rendered by the arbitrators.  Arbitration is also a mechanism that can be invoked by the parties voluntarily agreeing to the process after a dispute has arisen.

The advantage of arbitration is thought to be its greater speed as it eliminates things like the "discovery" process (the formal investigation that precedes any trial) which consumes significant time and resources.  Arbitration is also touted as a preferred alternative to a lawsuit in jurisdictions or in particular kinds of cases where juries are thought to be unable to adequately comprehend the issues involved, or where the parties fear a "runaway jury." Arbitration also provides greater finality:  an arbitration award cannot be appealed to a "higher court," and can be overturned only in extreme situations, such as fraud, or bias of the arbitrator.

But arbitration is not a panacea. Although it is possible to arbitrate small disputes without hiring legal counsel, most significant cases will require the expertise and advocacy skills of a litigator. In addition, the arbitrator(s) must be compensated at their hourly or daily rates by the parties, typically on a 50/50 basis. This can involve significant out-of-pocket expense if the hearings are lengthy.  Moreover, the finality aspect of an arbitration award is a two-edged sword:  the case is over, but if you did not win, and still feel wronged, there is no appeal.

Just as with lawsuits, the parties may choose to resolve their dispute with a compromise settlement at any time during the arbitration process.

Mediation

The third way that a dispute may be resolved is by mediation.  A mediator is a neutral person skilled in helping parties see and face the strengths and weaknesses of their case, enabling the parties themselves to come to a compromise agreeable to both sides. Unlike arbitration, the mediator has no power to adjudicate the dispute and impose an outcome.  An agreed upon mediation outcome is memorialized in a settlement agreement or other enforceable document, such as a judgment.

Mediation is a very flexible mechanism. The parties can select a mutually acceptable mediator, agree on the amount of time to be spent at the mediation sessions, and work with the mediator to determine what information may be voluntarily exchanged in advance to facilitate a productive session. As with arbitration, the mediator is compensated by the parties.

Most state and federal courts now encourage or require parties to participate in a mediation session at an appropriate juncture, with a view toward speedy resolution of the dispute.  As the Western New York Federal District Court has stated in its requirement for early mediation: “The central tenant of mediation is that the parties find their own solutions, with the assistance of the mediator. A hallmark of mediation is its capacity to go beyond traditional settlement discussions and explore creative outcomes responsive to the participants’ needs and interests.” - Western District of New York, Alternative Dispute Resolution Plan, Section 5.1.

MCCM's litigators have many years of experience in all three forms of civil dispute resolution and can represent you in any forum.  We have also served as arbitrators or mediators of a dispute involving parties who are not our clients.  If you have questions about any aspect of civil controversy resolution, please contact: Kevin S. Cooman at 585.512.3502 or kcooman@mccmlaw.com; Peter J. Weishaar at 585.512.3542 or pweishaar@mccmlaw.com; or Kristen M. McCorkmick at 585.512.3526 or kmccormick@mccmlaw.com 

This publication is intended as an information source for clients, prospective clients, and colleagues and constitutes attorney advertising. The content should not be considered legal advice and readers should not act upon information in this publication without individualized professional counsel.

About MCCM

McConville Considine Cooman & Morin, P.C. is a full-service law firm based in Rochester, New York, providing high-quality legal services to businesses and individuals since 1979.  With over a dozen attorneys and a full paralegal support staff, the firm is well-positioned to right-size services tailored to each client. We are large enough to provide expertise in a broad range of practice areas, yet small enough to devote prompt, personal attention to our clients.

We represent a diverse range of clients located throughout New York State and New England.  They include individuals, numerous manufacturing and service industry businesses, local governments, and health care professionals, provider groups, facilities and associations. We also serve as local counsel to out-of-state clients and their attorneys who have litigation pending in Western New York courts.  For more information, please contact us at 585.546.2500.