AboutTimmy Chou Expertise I am a experienced Mediator and a partner in a management consulting firm. As a mediator I work as a third-party neutral and specialize in partnership/shareholder disputes, management/labor issues, company culture difficulties, and family-owned business problems. I can help describe why alternative dispute resolution may be a good choice for you. As an experienced management consultant I may be able to offer creative ideas to help resolve your organizational and business problems and disputes. "If you say conflict, I say opportunity".
Question What happens if the loser in an arbitration battle doesn't pay the award to the winner? What if the loser is not able to pay?
Situation is a dispute over whether or not the seller knew about window rot and moiture damage behind walls. Seller lost (even thought she didn't know) and is told to pay $10,000 ($950 in fees) to the buyer. She has no savings, is on social security and disability, cannot work, has no assests. She rents a senior apartment and recieves less that $1000. from the government. Her rent is $800 and her medication is at least $100. She often doesn't buy food so that she can get her medication. She has been told that she has to pay before the end on the month.
Answer Thank you for your question!
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 unfortunately very typical. I am not a lawyer, nor can I mediate your dispute with just you alone but I can respond to your question from my business consulting experience. Note that this issue will almost certainly develop legal implications and you should consult an attorney.
Your question describes an area of dispute resolution that can often be the most tricky. Just because someone has a judgement or an opinion, does not mean that the remedy can actually happen.
In your case, just because there is an order to pay does not mean anything. The Buyer will likely have to compel the Seller to pay somehow and this will mean going back to a court. Unless your hearing was court-ordered, or in some other way the result was filed with the court and became a binding order, the Buyer will have no recourse but to go to court to get a court enforced order.
This may be in the form of a garnishment (of wages, tax refunds, etc), or a seizure (of cash or property). Even these procedures will not work if the Seller has no assets to garnish or seize. Besides, the legal process is expensive and time consuming.
The Buyer may feel good having a judgement and a seizure order, but will be out of a bunch of money for legal expenses. Many times it is financially better to just move on and deal with things.
In this case, the Buyer may want to count the cost of trying, probably without success, to squeeze money out of a stone. The Seller should make an effort to offer whatever good-faith settlement she can, and get a release for the balance.
She should also review her sales documents and find out why her real estate agent did not include a clause in the sales documents that state that "the Buyer has inspected the property and satisfied himself that the property is in an acceptable condition and therefore purchases the property AS IS. The Seller makes no express or implied warranty."
I wish I had better options for you.
These are some ideas. Feel free to follow up with additional questions.
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
