When litigants cannot agree on how to resolve their differences, they can present their grievances to court for trial, or they can participate in a dispute resolution process like mediation or arbitration. There are advantages and disadvantages to both courses of action. Inexperienced lawyers may push you to take a settlement because they lack robust trial experience. At Walters Gilbreath, PLLC, our seasoned team navigates all case types with ease, so we will help you to determine the best path for you and your case. We have found that being exceptionally prepared to try your case in court increases the likelihood and outcome of a favorable settlement.
Settlements and Alternative Dispute Resolution
The vast majority of cases are resolved through methods of alternative dispute resolution. These resolutions can be made through mediation, arbitration, or an informal settlement conference. In these methods, both parties attempt to settle some—or all—of the case issues without intervention from the court. The primary difference between mediation and arbitration is that in arbitration, the arbitrator hears testimony from both sides and makes a decision just like a judge would. In contrast, in mediation, a resolution is negotiated with the aid of a neutral third party, and the case is not over until both parties agree.
Although mediation is the most common method of settling complex cases, it is useful for most case types. It is now mandatory in most Texas Family Courts for parties to attend mediation before the court allows a Temporary Orders hearing or hears a final trial.
Mediation usually consists of the parties and their lawyers meeting in a neutral location with a mediator. Some mediators will allow a party that is physically not present to attend the mediation via video conference or call. In cases such as these, the attorney for that party still physically appears at the location scheduled for mediation. Experts, accountants, and other collaterals often assist at mediation as well.
Arbitration is an alternative dispute process in which an arbitrator, not a judge, resolves the parties’ disputes. An arbitrator can be a retired judge or an attorney.
In a divorce or child custody case, (on written agreement of the parties), the court may refer the divorce dispute to arbitration. The agreement must state whether the arbitration is binding or non-binding. If it is non-binding, the parties are not required to abide by the results. The court cannot refer the case to arbitration if the parties do not agree to it.
Arbitration typically takes place at the arbitrator’s office, and the arbitrator and the parties agree to the rules governing the arbitration before the arbitration. The arbitrator will hear testimony and review documents (just like a judge would) and then issue an award.
If the parties agree to binding arbitration, the court will render an order reflecting the arbitrator’s award. Unless the arbitration is for a custody case, and the court determines that the award is not in the best interest of the child, the arbitrator’s award will become the order of the court. Alternatively, an arbitrator can take arguments and evidence from counsel by written submission and then make a decision based on those submissions.
Informal Settlement Conferences
An informal settlement conference is a more casual opportunity for parties and their counsel to resolve disputes amicably. An informal settlement requires that a written document that contains specific language outlining the parties’ agreement is filed with the court. An informal settlement conference can be conducted either in person or through phone calls and written correspondence via counsel until a settlement is reached. Informal settlement conferences may be beneficial for those who do not wish to contend with the added costs and formalities that come with mediation and hiring a mediator. This option is also advantageous for parties that previously agreed on a basic framework for settlement but still need to work through the accompanying details.
All agreements reached through an informal settlement conference must be appropriately documented as required by the Texas Family Code; if not documented correctly, the agreements reached may be unenforceable and necessitate additional litigation, which can be costly.