What are arbitration and mediation? Do they mean the same thing? Are they different? When should you use mediation or arbitration instead of using a lawyer or going to court? Thank you.
Arbitration and mediation are two forms of what is known as “alternative dispute resolution”. These are methods by which two or more parties who have a dispute or issue can attempt to resolve their differences either without resorting to going to court at all or, if they have already filed a lawsuit, at least without leaving it to a judge or jury to decide.
With arbitration the parties go before a neutral evaluator of fact, not unlike a judge. In fact, arbitrators are often retired judges, although they don’t have to be.
During the arbitration the parties will present their facts, evidence, and other information to the arbitrator, who will then make a decision. Again, this is not unlike what a judge does, however without the formality of a Court and without having to dot quite as many “I”s or cross quite as many “T”s as one does when going to court. In addition, the rules of evidence are often relaxed, allowing the parties to share what is important and relevant to their case without having to worry about the legal intricacies and ‘gotchas’.
After the parties present all of their information to the arbitrator, the arbitrator will make a decision – a ruling – as to what will be the outcome of the case.
The decision of the arbitrator can either be final (known as “binding arbitration”) or provisional (this is known as “nonbinding arbitration”, and the parties can choose to accept the arbitrator’s decision, or one of them can choose to take their chances in court rather than accepting the arbitrator’s decision).
Mediation, by contrast, is typically performed by someone who has training as a counsellor or alternative dispute resolver, but is not usually performed by someone with a judicial or even a legal background (although attorney-mediators are becoming more common).
Where arbitration is intended to provide a decision about the issues made by a neutral third-party, mediation is designed to help the parties to reach their own decision. Thus a mediator will help to facilitate discussion between the parties, and try to help them to reach some sort of equitable middleground to which they can both agree.
Whether arbitration, mediation, or some other method, alternative dispute resolution is almost always preferable to leaving your fate to the Court, as it leaves the outcome much more in your own hands, rather than in those of a single stranger on the bench, or a jury of twelve strangers.