Mediation vs. Arbitration

[Mustonen]

Help me out here - I need a 30 second rundown of the ramifications of each.

[crackboy]

mediation is just a 3rd party to help two sides come to an agreement. i see arbitration as more of a 3rd party enforcing a decision whether or not the 2 parties totally agree

[TNKen]

Mediation. Parties come together with a third party neutral that acts as a referee to assist the parties to come to an agreeable resolution of a dispute.

Arbitration. Typically an informal hearing where an arbitrator sits as a judge, hears evidence, and renders a decision. Usually rules of evidence and procedure are relaxed. After the ruling of an arbitrator, a formal court may enter a judgment based on the arbitrator's decision that can be enforced.

[Mustonen]

Thanks, backs up what I thought. In my (naive) opinion, then, mediation as a contractual requirement before arbitration is a little bit meaningless. Parties in good faith should seek mediation regardless of contractual requirement, and if they aren't in good faith mediation won't do anything anyways.

Yeah, no?

[Mustonen]

Fair, or am I way off base?

[iceman]

Requiring mediation before arbitration seems pointless to me.

NOT a lawyer though.

[MMP]

Requiring mediation before arbitration seems pointless to me.

if they aren't in good faith mediation won't do anything anyways.

Yeah, no?

you guys writing a book about my divorce?

[drboudreaux]

Mediation

Mediation is always non-binding. Typically, the parties will meet in general caucus with the mediator to discuss the nature of their dispute, opening statements on their positions, etc. In these opening meetings, you typically do not want to disclose too much, as the other side may try to understand your angle and bottom line walk-away number before the mediation really begins. However, this depends on the nature of the dispute.

After this opening meeting, the parties typically break apart into separate rooms, and the mediator shuttles back and forth trying to move the parties closer together to a number they can live with. At the end of a successful mediation, neither party will be happy, but they will not be so upset by the deal reached that they will not agree. The mediator tries to persuade you of the problems in your position (i.e. your legal weaknesses), and will do the same to the other party to try to bridge the gap. If mediation is successful and a deal is reached, the mediator and the parties will typcially draft a settlement agreement together at the end of the mediation setting forth all of the terms of the agreement.

Mediation is nice because the parties have some control over the outcome. If the mediated settlement agreement is breached, many times the parties will sue on the settlement agreement, not on the underlying dispute. However, because the outcome is an agreed resolution, the agreements rarely get broken.

Arbitration

Arbitration can be either binding or non-binding, depending on the nature of the dispute (i.e. if it is a contract dispute, the contract will likely say that the parties have to submit to binding or non-binding arbitration, a statute may require it, etc.) You will need to look at the circumstances of your situation to determine whether it is binding or non-binding. If it is non-binding...well, that is self-explanatory. If it is binding, the only way to appeal or overturn the arbitrator's decision is if the arbitrator committed fraud, had a conflict of interest, breached duties, etc. In other words, it is fairly difficult to overturn a binding arbitration decision. Again, the circumstances of your situation control.

Arbitration can be before a single arbitrator, or a panel of arbitrators. If it is a single arbitrator, the parties will have to agree on who that will be. If it is a 3-person panel, typically, each party will choose one of the members of the panel to act as an arbitrator, and those two arbitrators will then choose the third arbitrator to serve on the panel.

Arbitration is much more like a trial than mediation is, but the rules of civil procedure and evidence are still more relaxed than a trial. Thus, arbitration is typically less expensive than a full blown trial, because the parties can stipulate to what evidence will be admissible without having to bring in witnesses, experts, etc.

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Both mediation and arbitration are good alternatives over litigation/trial to resolve a dispute. The parties have a bit more control than they do in a trial, and it is much more cost effective than trial.

/end law blog/

Edited to add: Even if the parties do not believe in good faith that they can reach an agreement in mediation, it is sometimes still helpful for the following: (1) it is a relatively inexpensive way to get a neutral 3rd party's take on your case and position. The mediator may point out flaws/weaknesses in your position that you may not have thought of before, and this may save you significant time and expense down the road litigating the case without discovering the major flaw. (2) it can provide some insight into the other party's position, how strong they believe their position is, and whether they are willing to go the distance to fight it out.

Many times, mediation softens the parties significantly, so even if the case does not settle in mediation, it eventually settles before trial, again saving everyone time and money. I have seen many cases where the parties do not resolve anything at the mediation, but the mediation serves as a starting point for resolution. It may be a week later, or a year later, but the case will likely ultimately settle.

/end law blog #2/

Required disclaimer - the foregoing is not legal advice, and no attorney client relationship has been established.

[XXX-er]

Mediation


Both mediation and arbitration are good alternatives over litigation/trial to resolve a dispute. The parties have a bit more control than they do in a trial, and it is much more cost effective than trial.

god damn it that is just plain un American

[Alaskan Rover]

It's my sincere observation that a little pre-panty twist MEDITATION is better than either one.

[stan]

The good Dr. has nailed it very well... including the after-effects of a seemingly unsuccessful mediation. I have seen cases settle multiple times based on the ideas planted during a mediation.

It doesn't always work, but it is almost always worth a try, at least where there is a legitimate dispute rather than a personal vendetta.

Again... this is not legal advice. That you have to pay for....

[RootSkier]

Both mediation and arbitration are good alternatives over litigation/trial to resolve a dispute. The parties have a bit more control than they do in a trial, and it is much more cost effective than trial.

Yet, many people believe that mandatory, binding arbitration is fucked precisely because there is LESS control. No standard rules of evidence/procedure, no appeals, etc.

Therefore, if you sign a contract that includes a mandatory arbitration provision, your potential recourse is severely hampered by that provision. This is precisely why nearly all consumer contracts include these provisions.

[Viva]

To Hell with what everyone else responded with in this thread. You're Guilty!