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Mediation of Commercial Lease Disputes: A Collaborative Approach to Resolving Disputes
The now ubiquitous 80-page commercial lease has a myriad of tenant and landlord rights and obligations which can potentially create conflict; for example, the calculation of operating expenses and rent escalations and determining the adequacy of building services. Major landlords and tenants see the disadvantages of litigating these disputes, and so a mechanism for streamlined resolution would be welcome. Enter, arbitration and mediation.
Commercial leases often involve long-term relationships. It seems almost inevitable that disagreements will arise. In the worst case, the disagreement ends up in litigation which can be time consuming, expensive, uncertain and disruptive. Arbitration and mediation are the cornerstones of alternative dispute resolution (ADR). By providing the parties with more control over the dispute resolution process, ADR can be quicker, less costly, and less disruptive than litigation. That said, in the view of many experienced practitioners, arbitration has morphed into a time-consuming process, often as expensive as litigation and has other shortcomings such as the non-appealability of the arbitrator's decision. Not so mediation which I believe to be a materially better form of ADR.
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