This month’s briefing on Partnership, Family Business and Private Client disputes explores how mediation can be invaluable for helping people resolve business issues and avoid protracted legal disputes.
Rather than confront conflict, people tend to avoid it, or avoid each other, until something snaps. When it does, fallings out can be serious, and they have a habit of doing so over the holidays. Come January, people invariably return, resolved to start the year afresh, take back control of their life, and jettison an unsatisfactory relationship. Or, more positively, end a rift.
Outside the litigation world, people rarely know about mediation, let alone how helpful it can be when issues flare up – especially where relationships are involved – precisely because unlike other forms of dispute resolution, you don’t need to wait until the damage has been done. Instead, mediation allows people to settle issues safely, inexpensively and confidentially without destroying themselves, their family or their business, and maybe even salvage a relationship. In a sense, it can be like marriage guidance, only for business issues.
Mediation is also worth using where…
1 People have different ideas about how a business should be run. Or who should run it.
2 People are worried about how change may affect them. Like plans concerning the future of the business, succession, or shareholdings, or because of a death, divorce, or family rift.
3 People have competing needs or interests, especially financial ones. Or interests that conflict with what the business needs.
4 A rift is becoming personal. Where close relationships are involved, commercial issues can easily be complicated by how someone feels or behaves. Or exacerbated by past altercations, unresolved misunderstandings, or conflicting hopes. In a family business or private client context, the real issues may be to do with the family, possibly even triggered by events going back to childhood. (Don’t under-estimate who didn’t get the red shiny bicycle).
5 A rift between founder/owner and colleagues or family members. Or competitive siblings. Or the treatment of family versus non-family members.
6 Inter-generational issues need addressing. In a family business, the younger generation may want control sooner than the older generation is prepared to relinquish it. Or vice-versa.
7 To stop conversations descending into the usual arguments, or prevent a potentially awkward conversation going off half-cocked.
8 Where you think people might benefit from bringing in someone independent to knock heads together and get them back on track.
If you have any thoughts or questions about whether a mediation could help someone, please contact me in confidence.
STEP’s Handbook ‘Business Families and Family Businesses’, a comprehensive guide for practitioners who advise business families and their professional advisers. Published by Globe Law and Business. Andrew co-wrote the chapter ‘Dealing with Conflict’ with Mark Lindley of Boodle Hatfield.