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Mediation & Arbitration

The two most popular types of dispute resolution are mediation and arbitration.

How Does Mediation Differ From Arbitration?

Arbitration is less formal than litigation, and mediation is even less formal than arbitration. Unlike an arbitrator, a mediator does not have the power to render a

binding decision. A mediator does not hold evidentiary hearings as would an arbitrator but instead conducts informal joint and separate meetings with the parties to understand the issues, facts, and positions of the parties. The separate meetings are known as caucuses.  In contrast, arbitrators hear testimony and receive evidence in a joint hearing, on which they render a final and binding decision known as an award.

What are some of the advantages of mediation?

  • Parties are directly engaged in the negotiation of the settlement.
  • ­The mediator, as a neutral third party, can view the dispute objectively and can assist the parties in exploring alternatives which they might not have considered on their own.
  • As mediation can be scheduled at an early stage in the dispute, a settlement can be reached much more quickly than in litigation.
  • Parties generally save money through reduced legal costs and less staff time.
  • Parties enhance the likelihood of continuing their business relationship.
  • Creative solutions or accommodations to special needs of the parties can become a part of the settlement.
  • Information disclosed at mediation may not be divulged as evidence in any arbitral, judicial or other proceeding.