Understanding the different legal processes: mediation and arbitration.
Within the field of civil cases, there are multiple ways in which a matter may be resolved. When people think of the legal field, most people imagine a case going through the court system, which involves a judge, jury, and two parties presenting opposite sides of an argument. While this is still the main way cases are handled today, there is a growing trend towards the use of other methods, these methods being called “Alternative Dispute Resolution” or “ADR.” ADR encompasses two main areas of dispute resolution, mediation and arbitration. While these two processes can look very similar, their effect on a case is drastically different. Therefore, it is important to understand the difference between each one.
Mediation is a collaborative meeting between the parties with a dispute and a neutral, third party mediator. The mediator is selected by both parties but does not make a final decision in the dispute, but instead, works with both parties to come to a mutually acceptable agreement.
Mediation can take multiple forms, depending on the needs of each party. Typically, the mediator will start out a mediation session with both parties together in the same room and will listen to each side’s position. Then, the mediator often will separate the parties in to separate rooms and talk to each side separately throughout the process. The mediator will point out weaknesses in the case, point out strengths, and suggests solutions to the dispute.
A successful mediation will end with both sides agreeing to do, or refrain from doing, certain things. Sometimes, at the end of the mediation session, the parties will then put their agreement in to writing and present it to the court as a suggested “order of the court” that would be binding on both parties. This last part is not a necessary part of mediation, however, it has the benefit of preventing the same dispute from arising in the future if one side fails to uphold their side of the agreement. Because mediation is often a useful tool used to begin settlement discussions, many judges hearing a civil case will order the parties of a dispute to participate in mediation before a trial will be scheduled.
Arbitration is much more akin to a trial than mediation, but is much less formal and more collaborative. Similar to mediation, an arbitrator is selected by both parties, however, unlike mediation, the arbitrator’s decision is usually a final decision in the case.
During arbitration, the arbitrator will hear arguments, review evidence presented, and rule on motions presented by both sides. Following the presentation of all arguments and evidence, the arbitrator will make a final decision and determine an award, if appropriate. In some cases, however, the parties can stipulate that the final decision of the arbitrator will not be binding unless agreed upon by both parties, but this is not the norm.
While the result of arbitration and trial are often the same—a final decision, with or without an award of money—arbitration is much quicker than a formal trial and is confidential. Arbitration is most often used in cases of contract disputes where the contract itself specifically states that all disputes will be handled through arbitration. This is known as an “arbitration clause” and is almost always enforceable against both parties.
To learn more about Hepworth, Murray and Associates’ mediation solutions, please call 801-872-2222.