Question: I’ve heard that rather than going to court, mediation is the better way to resolve disputes. If that’s true, why don’t more people use it?

Answer: Actually, more and more people are choosing to mediate their disputes. Mediation is appealing because it is cheaper, faster and tends to heal the rift between parties.

People who choose to "go to court" (pursue litigation) are generally unaware that there is a better alternative. Litigation has been so pervasive, they think it is the natural way to resolve conflicts, but there is nothing natural about it. When you consider other areas of our lives, collaboration and working through issues is the preferred path to achieving what we want. "Going to court" is really the unnatural way of resolving disputes.

In addition, people can become victims of their own egos. Their need to prove they are right, to be the winner, can propel them down the path of litigation.

Q: What happens to most cases that are litigated?

A: Ninety-five percent of civil lawsuits are never heard by a judge or jury and are dropped, thrown out of court or settled before trial. The image of two parties fighting it out in a courtroom with one eventually being named the clear winner is a myth. Of those cases that do go to trial, rarely is the outcome clear-cut.

And the procedure almost always damages the reputation of both parties due to the very nature of the adversary process, which is to "win at all cost." It also exacts from all sides a high toll in emotional stress, time and money.

Since cases are most likely going to be settled out of court anyway, it is much better to pursue a path of negotiation from the outset. Mediation is a "turbo-charged" negotiation that uses the services of a trained and experienced neutral third party who guides the parties to a resolution based on each party’s interests.

Q: Is the outcome of a dispute different depending on whether it is mediated or litigated?

A: Yes, mediation can be better for both parties. If a case ever gets to a judge or jury, they can decide only on "who is more right" and determine the financial settlement, if any. In mediation all the "interests" of the parties, both financial and nonfinancial, are addressed. For example, apologies, future business relationships and other important high-value but low-cost considerations are explored.

Mediation doesn’t strive to find who is right and who is wrong. Instead, it addresses the parties’ interests and arrives at an agreement that resolves the dispute more quickly and inexpensively. Both sides can then move on with their lives. In this respect, mediation can be a much more liberating experience.

One thing to consider is that if you do go to court and the other party is found to be at fault, that doesn’t necessarily mean the case is over. It will probably get appealed, and the loser may not have the money to pay the judgment. He/she may even file for bankruptcy.

This doesn’t happen in mediation. If the parties make an agreement, the ability to pay is an important factor to any settlement. If an agreement is not achieved, the parties still have the right to take the case to court.

Q: What are typical costs for mediation compared with litigation?

A: Naturally, there is a broad range depending on the complexity of the cases. A simple mediation can cost less than $1,000. More complex cases can cost many thousands of dollars, but are always less than the cost of litigation, which can range from many thousands of dollars to millions of dollars.

Q: How do the courts view mediation?

A: Very favorably. Judges almost always ask disputing parties whether they have tried to mediate before scheduling court proceedings.

The Hawaii State Judiciary strongly favors mediation. So does the Hawaii Legislature, which established the Center for Alternative Dispute Resolution as part of the Judiciary in 1985. The center serves as a resource for anyone wanting to explore how to use mediation and other alternative dispute resolution methods. It can direct people where to find qualified, trained and experienced mediators. It is also the conduit through which state judges direct or otherwise encourage nearly 3,000 cases a year to be settled out of court by contracting the services of community mediation centers across the state.

One of those centers, the Mediation Center of the Pacific, offers on-site mediation services at all six District Court locations. The center offers mediation services for all small-claims disputes. It reports that demand for its services has increased 10 percent over the last year due to the change in the law that raised the level of what qualifies as a small claim from $3,500 to $5,000. The center is also seeing an increase in elder mediations, which bring families together regarding how seniors and their belongings will be cared for.

Q: Do people who have used mediation tend to use it again?

A: The Mediation Center of the Pacific surveys its customers and reports that 82 percent of the clients affirm they would use mediation again, and 90 percent report that mediation was a useful process.

"Akamai Money" seeks out local experts to answer questions about business in Hawaii. If you have an issue you would like us to tackle, please email it to business@staradvertiser.com and put "Akamai Money" in the subject line.