When dealing with matters of oil and gas, it is important for all parties involved to protect their interests. Many people who end up in contract disputes also consider taking the matter to court.
However, it is potentially possible for some in these situations to solve their disputes without ever going to court.
FINRA discusses both arbitration and mediation, popular alternative dispute resolution methods. Arbitration is one such method.
Arbitration exists as a point between mediation and litigation. An arbitrator has power similar to that of a judge. They hand down their decision after listening to both sides present their arguments and evidence.
However, members of a contract dispute will not have to go to court if they opt for arbitration. They will not have to proceed through a hearing, and they will not have to spend the time and money others would need for traditional litigation.
This is also an option for contract disputes in which the parties involved feel like they could largely solve the dispute on their own, perhaps with a little extra help.
Mediators do not have the same power as arbitrators or judges, so it is entirely up to the contract parties to decide how to handle their case. Mediators will offer guidance and suggestions along the way and will help prevent arguments from getting out of control.
Why avoid the court?
Taking a case to court costs a lot of time and money. For most people, the benefits of avoiding a court case outweigh any potential benefits of going to court. Arbitration and mediation also allow businesses and contractors to keep control over their contract and related matters, which many find crucial.