Mediation and arbitration are both forms of alternative dispute resolution (ADR). Both mediation and arbitration are alternatives to trying a case in front of a judge or jury. Both forms of ADR have advantages and disadvantages.
Mediation
Mediation is a process wherein the parties, with the assistance of a neutral third party, the mediator, come to an agreement on the outcome of their dispute. It is often said in mediation that neither party will walk away entirely happy with the outcome. The mediator, usually a lawyer with a great deal of experience in the area of law being mediated, acts as a facilitator to obtain a resolution to the case at hand. One advantage of mediation over leaving your case up to a judge or jury is that the parties can sometimes come to an agreement that a judge or jury does not have the authority to grant. Sometimes, the parties can agree to outside issues that are not even part of the case.
The mediator may start with both parties together or separately. Then, parties may separate into what are called caucuses. The mediator then discusses the position of one party confidentially and takes that to the other party. A party can tell the mediator what they may or may not disclose to the other party.
In most parts of Georgia, divorce and domestic cases require mediation before going to trial. Also, Magistrate Court cases require some sort of mediation before being tried. A judge will often order mediation in other cases.
Many times, a case that seems hopeless will settle in mediation. Unlike a judge or arbitrator, the mediator does not make decisions but empowers parties to craft their own resolutions, fostering a sense of ownership and collaboration.
Arbitration
Arbitration is a more formal procedure resembling a mini-trial. In this setting, parties present their cases before an arbitrator or a panel of arbitrators acting as quasi-judicial figures. Many times, arbitration is required in contracts between parties. One advantage to arbitration is that the parties usually have the opportunity to choose arbitrators who have expertise in their particular area of dispute. For example, this may be particularly useful in complicated construction disputes.
The arbitrator reviews evidence, hears arguments, and ultimately renders a binding decision akin to a judge in a court proceeding. Arbitration can be either binding, where the decision is final and legally enforceable, or non-binding, offering the opportunity for further legal action if dissatisfied with the outcome. Generally, after the arbitration, the parties take the decision to a court to make the arbitration award a legally binding judicial order.
Other Differences: Cost and Timing
Cost-effectiveness and speed also factor into the disparity between mediation and arbitration. Mediation, generally less formal and structured, tends to be more cost-effective and expeditious than arbitration. Parties have more control over the process and the timeline, avoiding the lengthy procedures often associated with traditional litigation or arbitration hearings. Although parties commonly believe that arbitration is more cost-effective, arbitration can be much more expensive than trying a case in court.
Both mediation and arbitration may be much speedier methods of resolving a case versus a trial. When considering which method to choose, factors such as the nature of the dispute, the desired level of control, and the long-term relationship between parties play crucial roles. Mediation suits disputes where parties seek to preserve relationships, explore creative solutions, and maintain control over the outcome. Arbitration, with its binding decision-making process, is suitable when parties prefer a definitive resolution and are willing to relinquish some control over the outcome.
As your trusted legal partner, Debranski & Associates can advocate for you, assisting with informed decision-making and guiding you to select the most suitable ADR method aligned with your specific needs and objectives. Reach out to schedule a consultation, and we can help you determine the next best steps for your situation.