How Mediation Differs from Arbitration
Mediation and arbitration are both forms of alternative dispute resolution (ADR) aimed at resolving conflicts outside the court system. However, they differ significantly in processes and outcomes.
Role of the Third Party
In mediation, a neutral mediator assists the parties in communicating and negotiating their conflict, helping them find a mutually acceptable solution. The mediator does not impose a decision but facilitates dialogue. In contrast, an arbitrator makes a binding decision after considering the evidence and arguments presented by both sides. The arbitrator's ruling resembles a court judgment.
Control Over Outcome
Parties in mediation retain full control over the outcome since they collaboratively decide on the resolution. This often leads to a more satisfactory and sustainable agreement. On the other hand, in arbitration, the outcome is determined by the arbitrator, which may lead to dissatisfaction if one party feels their needs were not fully addressed.
Confidentiality and Formality
Mediation is generally more informal and confidential, encouraging open dialogue without fear of legal repercussions. Arbitration, while also confidential, follows more formal procedures, resembling a court trial, which can include rules of evidence and cross-examination.
Finality of Decisions
Decisions made in arbitration are typically final and enforceable by law, with limited grounds for appeal. In mediation, since the resolution depends on the parties’ agreement, it can be modified even after mediation concludes if both agree to the changes.