In the world of dispute resolution, there exist different methods through which individuals could go about getting their problems settled. Inasmuch as these methods (Arbitration, Mediation, Conciliation and Litigation) exist to get the problems solved, it is important to note that some are more private or less time consuming than others. This writeup focuses on the distinction between Mediation and Arbitration.
Mediation vs Arbitration: Definitions
Mediation can be explained as a procedure where an impartial individual, known as a mediator, aids the disputants in trying to reach a mutually acceptable resolution. Furthermore, even though there exists the presence of the mediator, they do not control the proceedings. The parties involved in said procedure have full control and can come to a consensus of their own will after the facts have been given and the issues identified.
Arbitration, on the other hand, is a private process where the judicial determination of a dispute is made by an independent third party. This third-party involves either an individual arbitrator or a tribunal (made up of an odd number to avoid a tie) as decided by the disputants after evidence have been provided and arguments made. The parties involved are allowed less formality in the presentation of their evidence and other processes
Mediation vs Arbitration: Differences
Mediation can be used in a situation where the parties would like to avoid a lawsuit or in the case where it has been filed; avoid a trial. This system; though controlled by the disputant’s interests and supported by courts, is most times considered non-binding; but binding in rare cases. However, in the case of an arbitral process, it is solely governed by the state and federal law and may be considered binding (when the award given is final and enforced by a court) or non-binding (when the arbitral award given is advisory and only final when accepted by the disputants).
More so, when a decision is reached after a mediation process, it is possible that the decision is appealed in a court of law. But in the case of an arbitral process, due to several laws which guide the process, the award given is most times unquestioned, except on unavoidable grounds.
You should also note that there are various methods through which a mediator can carry out their actions. Either through direct communication with both parties in real-time; shuttling back and forth between the parties so a consensus can be reached; aiding both parties to communicate or accessing all claims and facts given by the parties and proposing terms of agreement that favour both parties. However, in the case of an arbitral process, the arbitrator does not seek to compromise based on the parties’ interests; but following certain rules, they determine the outcome of the case in question.
All the methods employed by the mediator, exist to be used in delicate situations (familial and business relationships) to protect the interests and privacy of the parties and see that all are satisfied in a non-threatening and effective manner. However, arbitration is oftentimes used in commercial matters that seek to avoid the publicity, unnecessary expense and delay that comes with litigation.
Inasmuch as both methods would be considered alternatives in the service of justice; due to the fact that both parties are given the grounds to have a proper and fair hearing within a reasonable span of time without the unnecessary publicity and expense that comes with litigation, it is safe to say, that arbitration and mediation are processes that cannot be overlooked.