Mediation? Arbitration? Deciding Which is Right For You.
- Niki Martell
- Aug 24, 2021
- 3 min read
Updated: Mar 1, 2022
1While most clients are familiar with the media’s illustration of litigation, including jury selection and dramatic trials, these aren’t the only options to settle a lawsuit. Alternative dispute resolutions are an out-of-court option for parties, and in 2017 had a 75% success rate across the country. Two types of alternative dispute resolutions (ADR) are mediation and arbitration.
Alternative dispute resolutions are procedures designed to avoid litigation. Depending on the specifics of the case and the priorities of each party, ADR may or may not be suitable. By moving forward with ADR, parties can avoid a long, costly trial process. While mediation and arbitration are both alternatives to trial, they have several differences and considerations.
The Difference Between Mediation and Arbitration
Mediation is a process where a neutral mediator comes in to assist parties in coming to a consensus. In many cases, mediators are attorneys, but they don’t act as an attorney in the process of mediation.
A mediator will not represent a side or provide legal advice, instead, they work with both parties to find points of agreement. The mediator’s goal is to assist in getting both parties to settle voluntarily. If the parties don’t settle, the mediator doesn’t make any binding decisions.
Arbitration is another alternative but mimics the main idea of a trial. In arbitration, the arbitrator(s) act as a judge and come to a binding decision. Arbitration is usually made up of 3 arbitrators, one selected by each party and the third chosen by the two chosen arbitrators. The case is tried in front of the arbitrator(s) with no jury, no appeals, and a final, binding decision.
Is Mediation or Arbitration Right For You?
You might choose an alternative dispute resolution to avoid a drawn-out trial, but which is right for the client? Both of these alternative dispute resolutions offer pros and cons for each party.
Mediation has grown in popularity, exemplified through the Florida requirement that almost all lawsuits are required to be mediated before a court will allow them to go to trial. In mediation, the parties control who the mediator is, when the mediation occurs, and how the dispute is resolved.
There are some instances where mediation isn’t appropriate, these being:
Where deliberate, bad-faith counterfeiting or piracy is involved
Where a party is certain that it has a clear-cut case
Where the objective of the parties or one of them is to obtain a neutral opinion on a question of genuine difference
Where the objective of the parties or party is to establish a precedent
Where the objective of the party or parties is to be vindicated publicly on an issue in dispute
Alternatively, there are also times where mediation is an attractive option, including:
Where the party or parties want to minimize costs
Where the party or parties want more control over the settlement process
Where the party or parties want a speedy settlement
Where the party or parties want to maintain confidentiality
Where the party or parties are concerned about conserving an underlying business relationship between the parties in the dispute or want to preserve a certain public image or reputation.
Arbitration is much more like a trial, where the arbitrator or panel of arbitrators make a binding decision. When arbitration includes a panel, the settlement requires a majority vote.
Arbitration is also a commonly used alternative, being closer to formal litigation than mediation. Arbitration offers the lower cost, quicker settlement, and privacy that mediation does, but again, there are some times where arbitration is more appropriate than others.
Parties cannot agree on appropriate jurisdiction.
When the proceedings would be entirely too expensive or time-consuming.
When the arbitrator should be a person with expertise in the dispute.
Where both parties require confidentiality and privacy.
When one or both of the parties wishes to have a final verdict with no chance of appeal.
Arbitration may not be appropriate in these circumstances:
If the case is too complex.
If the party or parties want to retain their right to an appeal.
If there are more than two parties involved.
While different types of cases, including medical malpractice, breach of contract, wrongful termination, etc., have an option to go to alternative dispute resolution, it may come down to the client’s priorities.
Do you have a case for mediation? Are you looking for a strong mediator who works to effectively negotiate disagreements in an effort to find solutions that reach a favorable settlement for both parties involved? As your mediator, you get the benefit of my litigation experience to facilitate a productive, effective mediation for your clients. Click here to schedule your next mediation.
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