Mediation is a process in which a third-party neutral assists in resolving a dispute between two or more other parties. It is a non-adversarial approach to conflict resolution. The role of the Mediator is to facilitate communication between the parties, assist them in focusing on the real issues of the dispute, and generate options that meet the interests or needs of all relevant parties in an effort to resolve the conflict.
Unlike arbitration, where the intermediary listens to the arguments of both sides and makes a decision for the disputants, a Mediator assists the parties to develop a solution themselves. Although Mediators sometimes provide ideas, suggestions, or even formal proposals for settlement, the Mediator is primarily a “process person”, helping the parties define the agenda, identify and reframe the issues, communicate more effectively, find areas of common ground, negotiate fairly, and hopefully, reach an agreement. A successful mediation effort has an outcome that is accepted and owned by the parties themselves.
Cost: While a Mediator may charge a fee comparable to that of an attorney, the mediation process generally takes much less time than moving a case through standard legal channels. While a case in the hands of a lawyer or a court may take months or years to resolve, mediation usually achieves a resolution in a matter of hours. Taking less time means expending less money on hourly fees and costs.
Confidentiality: While court hearings are public, mediation remains strictly confidential. No one but the parties to the dispute and the Mediator or Mediators know what happened. Confidentiality in mediation has such importance that in most cases the legal system cannot force a Mediator to testify in court as to the content or progress of mediation. Many Mediators destroy their notes taken during a mediation once that mediation has finished. The only exceptions to such strict confidentiality usually involve child abuse or actual or threatened criminal acts.
Control: Mediation increases the control the parties have over the resolution of their dispute. In a court case, the parties obtain a resolution, but control resides with the judge or jury. Often, a judge or jury cannot legally provide solutions that emerge in mediation. Thus, mediation is more likely to produce a result that is mutually agreeable to the parties.
Compliance: Because the result is attained by the parties working together and is mutually agreeable, compliance with the mediated agreement is usually high. This further reduces costs, because the parties do not have to employ an attorney to force compliance with the agreement. The mediated agreement is, however, fully enforceable in a court of law.
Mutuality: Parties to a mediation are typically ready to work mutually toward a resolution. In most circumstances the mere fact that parties are willing to mediate means that they are ready to "move" their position. The parties thus are more amenable to understanding the other party's side and work on underlying issues to the dispute. This has the added benefit of often preserving the relationship the parties had before the dispute.
Support: Mediators are trained in working with difficult situations. The Mediator acts as a neutral facilitator and guides the parties through the process. The Mediator helps the parties think "outside of the box" for possible solutions to the dispute, broadening the range of possible solution.
A mediation session involves a discussion of the dispute by the parties in an informal setting. Typically the session is attended by the Mediator, the parties and their counsel, if they have retained any. The process is informal and confidential. No record is made of the proceedings and statements made in the mediation are not admissible in any court proceedings.
Mediation is a voluntary, non-binding process. The Mediator has no authority to make decisions or force the parties to accept any terms. The Mediator does not give legal advice. Instead, the Mediator’s role is to help the parties identify obstacles to settlement and develop strategies to overcome those obstacles. Generally a mediated settlement resolves the entire dispute between the parties and court proceedings are not necessary.
Mediation provides a safe environment for serious negotiations. The parties have equal opportunity to educate and influence their opponents. The Mediator assists each party in analyzing the risks and benefits of their position, and in defining each party’s interest.
Unlike trial, in which the parties are in opposition, mediation focuses on cooperation by all the parties. It can bring an end to the dispute more quickly and inexpensively than going to trial, and the outcome can be made confidential. Because the resolution is created by the parties, rather than a judge or jury, the settlement can provide for more than just the payment of money. If an agreement is reached, it will meet the parties’ specific interests. While mediating is hard work, you may leave feeling that the process has given the best resolution of, and positive closure to the dispute.
Arbitration and mediation are similar in that they are alternatives to traditional litigation, and sometimes they are used in conjunction with litigation (opposing parties may first try to negotiate, and if that fails, move forward to trial). Both arbitration and mediation employ a neutral third party to oversee the process, and they both can be binding. However, it is common to employ mediation as a non-binding process and arbitration as a binding process. In simpler terms, binding arbitration replaces the trial process with the arbitration process.
Arbitration is generally conducted with one or more arbitrators who take on a role like that of a judge, make decisions about evidence and give written opinions (which can be binding or non- binding). Although arbitration can be conducted with one arbitrator, it is also common for each side to select an arbitrator. Then, those two arbitrators select a third arbitrator, at which point the dispute is presented to the three chosen arbitrators as a panel. Decisions are reached by majority vote.
Arbitrations are generally held in a conference room, but the process is more formal than mediation. The arbitrator(s) will swear witnesses who will testify in response to questions by the parties or counsel, if they have retained counsel. The arbitrator(s) will also review the documents provided by the parties. The parties may decide to have the hearings recorded by a court reporter so that a transcript is created. At the close of the hearing, the arbitrator(s) will review the evidence and make an award, setting out how the parties are to comply and the time frame for compliance. Arbitrations, like mediations, are not public.
While the arbitration process is more formal than mediation, it is less formal than a court proceeding. The parties are given the opportunity to support their position through testimony and documents, without the technical evidentiary rules that control court trials.
Arbitrations are scheduled by the parties and the arbitrator, and take place on the scheduled date which is generally much sooner than a matter can be heard in a court trial. Because arbitrations are less formal, they are also less expensive. The parties may also agree to place certain limits on the arbitrator’s award which reduces the parties’ risk at the arbitration.
Parties are never required to have counsel. However, the arbitrator cannot give you legal advice about presenting your case, and the arbitrator is required to follow the law in making the award. Because the arbitrator will be making a binding award, many parties feel counsel will be better able to present their position.