There are many processes small agriculture businesses, farms and ranches can take to resolve conflicts that arise among partners and even family members involved in the business. Mediation is just one choice available. Mediation is a voluntary settlement process by which a neutral third party mediator assists parties in reaching mutually acceptable, voluntary, informed and consensual agreements.
Mediation is frequently confused and used interchangeably with arbitration. Both methods have distinct differences and processes. Mediation is based on voluntary settlement with a mediator who has no power to make decisions; whereas, arbitration is a highly structured, more formal process whereby an arbitrator, like a judge, decides, after an evidentiary hearing, who wins and makes a binding decision, usually a money award which is usually without reasons for the decision.
Mediation is an educational process in communications. It allows the parties to the dispute to both be “winners." This is done in the process of identifying the issues, reducing misunderstandings, clarifying priorities, exploring commonalities and interests. The mediator is a facilitator, practicing active listening skills, and assists the parties in generating options, creative problem solving. The mediator looks for points of agreement. Mediation is future focused. It does not find fault or fix blame as the traditional approach to litigation does. The bottom line is it saves time, money, resources and most importantly for many thrifty ag businesses and farms, legal fees.
Perhaps the most appealing advantage of mediation is control. Each person likes, wants to feel some self-dignity, or control over one’s life, especially when we've often worked so hard to establish what we now own and control.
This process addresses many business conflicts and rational fears that many business partners face. Because the mediation process is confidential, neither party has anything to lose in mediation. Each party can reveal or disclose as much or as little as they want. Frequently, separate meetings with the mediator are helpful for the parties in reaching agreements or even partial agreements.
Mediation can be used in a variety of ways. Farm transfers and the drafting of contracts/documents pose the opportunity for disagreements, even among close partners.
Mediation saves extensive discovery costs in litigation that can be protracted. With the parties themselves involved in the negotiation process of mediation, attorneys, CPAs and other expert advisors provide valuable assistance for the ultimate decision maker: the parties.
Studies reveal a much higher compliance rate with mediated agreements of disputes than legally-decided judgments which may be appealed if the parties can so afford.
In conclusion, mediation is not a panacea to all business problems. But, mediation is an option available which directs a process toward solving problems and not finding fault. As Justice Brandeis said, “Nine-tenths of the serious controversies which arise in life result from misunderstandings.” Mediation can result in better communications between people which in turn allows each “side” to save face. This problem-solving process results in “win-win” situations for all concerned.
ElGene Ver Dught is a mediator-attorney with offices in Independence, Mo.
