If you are reading this, most likely you have heard the terms, mediation and arbitration. But do you really know the difference between the two and how to use either one to successfully resolve disagreements?
Both mediation and arbitration are alternative processes by which two or more parties seek to resolve their disagreements without resorting to going to court.
Both can be handled in a formal or informal fashion.
Both include the selection by the parties of an impartial 3rd person to manage the process, whether by mediation or arbitration.
With limited exceptions as outlined in state or federal laws, organizational rules of arbitration or by agreement of the parties, both mediation and arbitration is both private and confidential.
Both parties can be represented by an attorney.
Both are forms of “Alternative Dispute Resolution” or “ADR”.
WHO OWNS THE SOLUTION?
In MEDIATION, the mediator is only responsible for the process to help the parties, “negotiate” their own resolution of their differences. The mediator does not decide what the best resolution and does not impose a resolution on the parties. I like to tell the parties that as mediator, I own the process and as parties, they own the solution. A mediator doesn’t determine who is right or wrong or what is just.
As compared to mediation, in ARBITRATION, the arbitrator not only controls the process, but also controls the resolution. Unless the parties settle their dispute, with or without the aid of the arbitrator, the arbitrator will impose a decision on both parties. The arbitrator
ARE THE RESOLUTIONS BINDING?
An agreement reached by the parties in MEDIATION can be binding if the parties agree to make it binding. If the parties intend for their agreement to be binding, it is usually recommended that the agreement be memorialized in a writing that the mediator can help the parties draft. Often, if not always, if the parties were referred to mediation by a court, the court will require the agreement to be in writing.
ARBITRATIONS do not need to be binding unless agreed to by the parties. In most cases, arbitrations are binding but there are instances in which the parties will agree to non-binding arbitration, usually where one or both parties want to try out their case, evidence and arguments or flesh out the evidence and arguments of the other side. Non-binding arbitrations are often treated as a practice run.
ROLE OF EVIDENCE AND ARGUMENT
The presentation of evidence and the argument of the parties in ARBITRATION is fundamental to the process. Each party is attempted to convince the arbitrator of the correctness of their position and to make a ruling in their favor.
In MEDIATION, evidence and argument is much less significant to resolving the dispute. A mediator should allow each party to present their position and perspective and how they hope to resolve the dispute but is generally more interested in learning the true motivations of each party to help them come to an agreement.
ABOUT THE AUTHOR
Howard F. Kline has been practicing law for over 46 years and has represented plaintiffs and defendants in court, mediation and arbitration for much of that time. He has also served as a certified mediator and arbitrator. Howard has also been the founder and host of CRE Radio & TV and now a new podcast, Uncommon Sense with Howard Kline. He can be reached at https://tkgadr.com or on YouTube at @howardkline.