Mediation vs Lawsuit

Lawsuit — When a dispute arises, most people consider filing a lawsuit. Lawsuits are very expensive and can take a long time to resolve. The average cost of litigation for homeowners ranges from $15,000 to $50,000 or more. You will have to pay attorney retainers, court filing fees, and expert witness fees before your case goes to trial. In some cases, the cost for a lawsuit could be more than the loss. Most lawsuits take 12 to 24 months or more to resolve. A lawsuit takes on a life of its own.

Most homeowners assume that the court will enforce payment. When you win a lawsuit there is no guarantee you will ever collect the money. The judge issues a judgment, which is a legal document stating that someone owes you money. However, the court does not collect the money for you. It becomes your responsibility to enforce the judgement.

You must hire a constable to seize assets, attempt wage garnishment (which is extremely limited in Texas), or place a lien. Another option is to hire a collection agency for a percentage of what is collected. Small contractors or individuals usually have no assets to seize, no wages that can legally be garnished, or they simply shut down their business and reopen under a new name. In most cases even though you won the lawsuit, you will never collect the money.

Small business owners, contractors, or neighbors may not have the assets to pay the judgement. When a dispute develops homeowners have two options to resolve the conflict, mediation, or a lawsuit. An important feature of the Texas system is that small claims courts frequently order mediation before allowing a case to go to trial.

In Texas, mediation is widely used because it helps people resolve disputes quickly. Often disputes can be resolved in one session. This is especially valuable in real estate and home‑repair disputes, where problems, communication breakdowns, and incomplete expectations are common. Mediation keeps the process calm, respectful, and focused on solutions rather than blame. Judges in Tarrant County and across the state support mediation and view litigation as a last resort.

In Texas, small claims are handled in Justice of the Peace Courts, and the maximum amount you can sue is $20,000. Texas courts strongly encourage mediation, especially for small claims because the courts are overloaded. The Justice Courts in Texas handle thousands of small disputes. The disputes consist of contractor disagreements, landlord‑tenant issues, neighbor conflicts, repair disputes, and consumer complaints. These cases may be small in dollar amount, but they take up a tremendous amount of court time. Contractor issues, warranty disputes, and home‑repair disagreements are a large part of disputes that keep the courts busy and can be resolved through mediation.

Mediation — Mediation is based on communication and cooperation whereas a lawsuit relies on a judge to make the final decision. In Texas, the Justice Courts strongly encourage mediation to resolve disputes. Mediation is about attempting to reach an agreement that is beneficial for both parties. It is a private, structured conversation led by a neutral third party who helps both sides talk through the issues and explore practical solutions. It is informal, confidential, and far less expensive than litigation. More importantly, it gives the parties a voice and an opportunity to state their case and concerns.

In Texas small claims courts frequently order mediation before allowing a case to go to trial. Many Justice Courts partner with local Dispute Resolution Centers or certified mediators who offer low‑cost or even free mediation sessions. If the parties make an agreement, the case can be dismissed or converted into a binding settlement. If mediation fails, the case will proceed to a hearing. This approach reflects Texas’s belief that most disputes can be settled through conversation rather than confrontation.

The mediator does not take sides, provide legal advice, or force a decision. They guide the conversation toward a workable agreement. If both sides reach a solution, the mediator writes the agreement that both parties sign. This agreement is legally binding and will be filed with the court if the case is already pending. Mediation is private, confidential and is not a public record. This protects all the parties from unnecessary embarrassment or exposure.

Payment Plans — Mediation allows for payment plans, partial refunds, repair agreements, timelines, and warranties. The parties can create a realistic payment plan that fits the situation and ensures the homeowner receives the money owed. This has a higher chance of compliance, and it is more likely that the parties will follow the agreement they helped create.

Mediation Failure — If an agreement cannot be reached, the case returns to the court. The Justice of the Peace Judge is not an expert in construction, roofing, plumbing, insurance, or any technical field. However, the judge must make a ruling based only on the evidence presented that day. In small claims court, each person has a short opportunity to present their case. The judge does not investigate, visit the property, and has no expert knowledge. The judge makes a ruling based on general legal principles. The outcome will come down to who presents a better case in a short hearing.

The Texas courts offer mediation because it allows both sides to have a voice and state their case. Mediation is usually the fastest, least expensive, and less stressful way to resolve a dispute. A lawsuit still has its place when someone refuses to cooperate, if there is evidence of fraud, or when the value of the damage is high enough to justify the cost. A lawsuit should be the last resort.

Charles Johnston Realtor® | SRES, SRS, RENE, PSA, CHMS TREC License — 0506067 Keller Williams Fort Worth Phone: (817) 917 6234 Email: crjohnston65@outlook.com Website: charlesjohnston.kw.com

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