Expert: Timmy Chou - 6/29/2011

Question
I own a home in New Jersey with 2 family members.  We all agree that we want to sell the house, but one of the owners wants to purchase it, and has made an offer the other two parties, and  independent appraisal firm, feel is very low. Can mediation help us resolve this, or can 2 parties sell the house against the wishes of the third?

Any help or direction is much appreciated.

Answer
Thank you for your question!

Sorry for the delay as the system notified me of your question this morning.

As I always mention, Mediators act as neutral third parties to disputes and never "get involved" in judging the merits of conflict, but merely use special techniques to help the parties decide how to negotiate their own settlement.

The case you describe here is a common one and may lend itself to mediation.  I am not an attorney and cannot give you legal advice.  You may wish to consult a lawyer if you have concerns.

Mediation is used to settle disputes in a wide variety of areas.  People use mediators to handle divorce, lawsuits, employment problems, education disputes, and others.

In the USA the vast majority of lawsuits actually settle before trial.  Therefore the issue is not IF you are likely to negotiate a settlement but WHEN.  Wise people take advantage of trained mediators early to save time and money.  Many courts in the US require mediation before cases can be heard.  

Typically one party or the other suggests the idea of mediation and a mediator is selected.  The parties split the fees of the mediator.  Mediation is usually voluntary.

The mediator meets with the parties together and apart to help explore possible settlement options.  Mediators are not judges and only help the parties decide how to move forward and not dictate or advocate any particular solution.

Disputes like yours where the parties have a strong interest in preserving a relationship post-settlement lend themselves well to a mediated settlement.     

For your information, the pros and cons of the types of dispute resolution methods follows.

GOOD LUCK!

Arbitration, Mediation, and Litigation

Arbitration: the referral of a dispute to one or more impartial persons for final and binding determination outside of the judicial system

Benefits of Arbitration:

Confidential, no public record
Limited exchange of documentation, information
Quick, don't have to wait for a court date
Arbitrators have expertise in the subject matter and are trained in conflict resolution
Cheaper than litigation
Preserves business relationships

Negatives of Arbitration

It's a compromise, no %100 winner
Complex arbitration can be costly
If not satisfied, may litigate the arbitration procedure
Poor results with an unskilled arbitrator
Both parties must agree to cooperate in the process

Mediation: the process by which parties submit their dispute to a neutral third party (the mediator) who works with the parties to reach a settlement of their dispute.

Benefits of Mediation:

Neutral mediator can objectively suggest alternatives not considered before
Parties are directly engaged in negotiating the settlement
Can be quicker than litigation
Less costly than litigation
Preserves business relationships
85% of American Arbitration Association cases mediated find successful solutions

Negatives of Mediation

may not reach a binding decision
unskilled mediator

Litigation: using the judicial system to resolve disputes

Benefits of litigation:

a clear winner and loser
uses a prescribed set of procedures
more predictable outcomes
is final

Negatives of Litigation:

waiting for court dates can do more harm
usually more expensive than mediation and arbitration
part of the public record