In 1992, Southwest Airlines and Stevens Aviation settled a dispute about the slogan "Plane Smart" with an arm wrestling match instead of spending hundreds of thousands of dollars on legal fees and letting the courts decide the matter.

As a result, both companies saw a significant increase in profits and it was also a great way to show what the companies are all about.

Any problem in your business is just an opportunity to be creative. Alternative dispute resolution is about finding the best possible business deal in any situation. I believe that today’s lawyers need to think outside the box. Out-of-court litigation and mediation are an important part of creative lawyering (Albert Fiadjoe).

ADR is becoming more popular. It's fast – usually an agreement is reached between the parties within 90 days. Given the workload of the courts, this is one of the biggest benefits, but cost-effectiveness is also an important factor.

Sometimes, litigation isn't really an option because the two parties are so closely linked. It's important to reach an agreement and maintain a future relationship. Or, both parties are reluctant to expose the details of the conflict in court. In these cases, ADR is a better way to resolve conflicts. You can do this through direct negotiation between the parties (conciliation), or through a third party (mediation), or through a binding decision by a third party involved in the dispute (arbitration). The nature of the dispute and the relationship between the parties decide which method is most appropriate.

Advantaged of mediation is business: 

• In business, the parties usually have a close relationship even if they're in a dispute, so it's not just about settling the dispute. It's also about maintaining the relationship for the future. Mediation is a great way to do this because it's a non-adversarial process. Unlike a legal proceeding, where one party will inevitably lose, mediation allows for communication and business relationships to be restored and continue in the future.

• It's important to consider the time factor (when the company receives its money) and efficiency (you may win, but the other party doesn't pay).

• Confidential information doesn't have to be shared with anyone but a neutral, impartial mediator who is bound by the obligation of confidentiality.

• In addition to mediation, there are a few other options in Hungary today. You can go to arbitration for financial matters, you can ask for conciliation in consumer protection cases, and you can ask for the Performance Certification Expert Body to settle construction disputes.

• Arbitration tribunals are private tribunals where the parties involved agree to let an arbitral tribunal settle their dispute. You can also ask a lawyer to be an arbitrator.

If you are interested in alternative dispute resolution, you can contact me here >>