Most of the people involved in the hospitality industry will prefer to use alternative dispute resolution techniques instead of taking matters to court. While we here at Perry Group are not mediators, it’s worth taking a look into the mediation process of dispute resolution because it will often cost less than litigation. It also takes less time since hospitality dispute resolution won’t have to go through a lengthy legal process. This allows for both parties to move forward as soon as possible. It also protects the reputation of the business as well since the public won’t know about any pending legal cases.
There are several types of alternative dispute resolution techniques, and one of them is mediation. This is a consensual process that involves intervention of a person chosen by mutual agreement by both parties. This person, called the mediator, should be someone who has not had any relationship with either party within a specified time frame. They shouldn’t have any stake in either business, directly or indirectly, and should not benefit from any of the possible outcomes that the mediation would produce in the hospitality dispute resolution process.
The mediator will work with both parties to find common ground. This is essential in helping to resolve the issue in a way that both parties will deem fair. If a resolution or settlement is not achieved, a mediator will strive to come up with a compromise instead.
The Mediation Process
In hospitality mediation, the mediator usually will start by working with each party separately to understand what their grievances are. Once they have gathered enough information, they will create a statement that outlines the exact differences of the two parties. Having this statement is important since it helps everyone focus on the important issues. Thus, preventing the problem from escalating in the middle of a heated argument.
The mediator will develop a memorandum of understanding. This outlines the resolution to the issue (or at least a compromise), and then it is presented to both parties. Generally, this is enough for most business owners. Although some will still want to hire a lawyer to make the memorandum a formal contract.
When Should Mediation Happen?
Most hospitality contracts prohibit litigation, which is not really surprising since it requires a lot of time, money, and effort. Many contracts contain a mediation clause. This means that a party who has a grievance against another party should agree to go through mediation before he demands arbitration or files a case in court.
“Pre-suit mediation” is the term that’s used to refer to the mediation process that both parties must go through before they can proceed to arbitration or litigation. In pre-suit mediation, both parties can select their own mediator based on mutual agreement or on what their contract stipulates.
If the terms of the contract and the nature of the dispute allow for litigation, the trial court judge has the right to appoint a mediator in case the parties don’t agree on which mediator they should choose.
Your Dispute Goes To Court
If you’re in the hospitality industry and a dispute arises, seek assistance of an attorney knowledgeable in the hospitality industry. The attorney may also engage a hospitality expert who can help consult and strengthen your argument during mediation. If you’re in the middle of a dispute that may go to trial, get in touch with Perry Group International. Hospitality dispute resolution can often be difficult, and we can refer legal counsel who can assist you with reaching a resolution or settlement.
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