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Including plans for handling disputes

When forming a business, one of the most important things to do is plan ahead for potential disputes.

No one wants to get into a dispute, and no one wants to deal with them. However, they are an inevitability for many business owners. Thus, having a good plan is better than nothing.

Arbitration as a dispute-resolving method

FINRA lays out some alternative options outside of dispute management through litigation. These options are good for people who want to avoid the stress of taking a case to court, which is advisable in most situations.

Arbitration and mediation serve as the most popular methods for handling disputes. Arbitration allows for similar support as litigation, but without the costly expense and the amount of time it takes to push a case through court.

Arbitrators have a similar role to judges and similar legal power. They will listen to all sides present their arguments and evidence, then come to a decision. They pass this decision down to the arguing parties, who must legally abide by it.

Opting for mediation

On the other hand, mediators do not have this power. They simply act as guides and referees of an argument. They will ensure everyone gets their chance to speak, making sure no one feels spoken over or overlooked.

They also have skills in conflict management and de-escalation, so they can keep the arguments from getting out of hand.

Finally, traditional litigation exists for cases in which it is prudent, such as those where parties suffer from irreconcilable differences or large amounts of assets are involved.


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