One of the challenges of building a private conflict resolution business is that parties supposedly expect mediation to be free because the courts and several community organizations offer the process pro bono, or for free. While it is true that some courts, such as Family Court, the Commercial Division, and Small Claims Court, have alternative dispute resolution (“ADR”) processes built into their systems, they certainly aren’t free to the parties for a variety of reasons:
1. LAWSUITS REQUIRE PAYMENT OF FILING FEES.
In New York County, it costs $210.00 to purchase an Index Number, which is required for filing the Complaint in Supreme Court. Small Claims filings are relatively less expensive at $15.00 to $20.00, but they still aren’t free, and you must still pay to serve the Summons and Complaint on the Defendant(s), which might cost another $85.00 to $95.00. You might also need a lawyer to help you draft the Complaint, and that could cost between $200.00 and $800.00, unless you have a case that qualifies for free services from a local law clinic or a contingency fee structure (where your lawyers’ fees only get paid if you get paid.
Note that you might still be responsible for all of the court costs). In short, you’re probably out at least $300.00 just to assert your claims to another person who isn’t going to help you create a resolution uniquely tailored to fit your needs and wants. That might not seem like a lot of money to some people, but it’s not free, I’m sure there are a lot of other things you’d like to spend $300.00 on and there are some private conflict resolution services that might get you a complete resolution–not just an opportunity to state your case–for around the same amount.
2. MOST LAWSUITS REQUIRE DISCOVERY OR THE GATHERING OF MANY TYPES OF EVIDENCE.
The courts base their decisions on evidence. They judge your documents, your testimony, your photographs, what other people say about you, how you present yourself, and how the other parties in the case (including your attorneys) present themselves. You’ll probably need to gather evidence from a variety of sources, which will cost time and money. Deposition testimony alone can cost $500.00 to $1,000.00 per party, not considering the cost of the attorneys you will probably need to lead the cross-examination. Plus, if you have to file Motions to Compel production of certain evidence, you can add another $1,000.00 or more for every appearance on that Motion.
You’ve now committed upwards of $2,300.00 and at least a year of your time, but you’re probably not in a position to discuss a resolution in court yet. If you’re lucky, that will come soon, and you will get your free three hours with a court-assigned mediator who will start charging you $300.00 per hour if you don’t settle your case within the first three hours.
3. LAWSUITS HAVE INTANGIBLE COSTS.
As I discussed in my course, Litigation Survival Skills: A Client Perspective, some of the most stressful life events are personal injury or illness, dismissal from work, and change in financial state. These are often going in and around the court cases, but the courts aren’t equipped to deal effectively with the psychology of disputes. As such, even verdicts in the parties’ favor often feel empty or only feel like temporary wins. Relationships, privacy, and confidence can all be shredded during litigation. Thus, there is often a feeling of loss, even in a win.
Court-mandated mediation attempts to limit the costs of litigation to the parties, the courts, and the taxpayers. However, there might be a better solution in the majority of cases. By seeking private conflict resolution services for your business, consumer, contract, employment, family, or other relationship dispute, you might save the court fees, attorney fees, discovery costs, your privacy, your confidence, and your relationships.
Would you like to see if private conflict resolution services are appropriate for your current dispute? Tell me more
Nance L. Schick, Esq. is a New York City attorney and mediator who focuses on keeping people out of court and building their conflict resolution skills, especially in business and employment disputes. Her holistic, integrative approach to conflict resolution draws from her experience as a crime victim, human resources supervisor, minor league sports agent, litigant, and trial attorney. She is a 2001 graduate of the State University of New York Buffalo Law School trained in Alternative Dispute Resolution (ADR) by the Equal Employment Opportunity Commission (EEOC), Financial Industry Regulatory Authority (FINRA), and International Center for Ethno-Religious Mediation (ICERM). She is also creator of the Third Ear Conflict Resolution process, author of DIY Conflict Resolution: Seven Choices and Five Actions of a Master, and an award-winning entrepreneur, who has been acknowledged by the U.S. Chamber of Commerce (2015 Blue Ribbon Small Business), Enterprising Women Magazine (Honorable Mention, 2014 Woman of the Year awards), and Urban Rebound NY/Count Me In (Finalist, 2013 Pitch Competition).