Mediation of Commercial Real Estate Disputes

Mediation has been proven effective

Mediation has been proven effective in commercial real estate disputes for a variety of reasons. Mediation may be conducted in a timely fashion, often within a few months of the dispute arising. For mediation, it is possible for just a few hours involved in one meeting will achieve mutual agreement or decide that the dispute must escalate. Also, when the agreement to mediate is part of a real estate contract, then the parties are bound to do so before they can escalate the dispute to litigation.

The Trained Mediator

Mediation evolves the parties to the dispute and a trained mediator. This mediator is someone completely unassociated with the dispute and has no vested interest in the outcome. They assist the parties in first identifying the sources of their conflict and then help them focus on the issues of real importance to them. The mediator then guides the parties through multiple possible solutions in an effort to reach an agreement, compromise or reconciliation. Another plus for mediation, when compared to arbitration, is that the parties may develop the solution themselves as opposed to having a solution determined for them by a third party. If the parties do reach a resolution and adopt a mediated agreement, the mediated agreement can be binding.

Litigation may have detrimental effects

If the parties are unable to reach a resolution or are dissatisfied with the mediation process, the parties may decide to pursue litigation. Litigation may have detrimental effects on both parties in a dispute. The value of the parties’ interest may be diminished by injunctions, restraining orders or other restrictions imposed by the courts. A variety of disputes can arise from a commercial property lease transaction depending on the terms of the lease, the type of the real estate and the uses of the property. Due to the possible long duration of litigation proceedings, land or floor space may not have the same value at the end of litigation as it did when the dispute arose.

DiJulio Law Group