Arbitration Vs. Mediation
The main difference between arbitration and mediation is a simple one: arbitrators hand down decisions, just as judges do, which can only be contested under certain circumstances. In other words, by agreeing to arbitration a party agrees to be bound by the arbitrator’s ruling, barring some exceptional deviation from the normal procedure.
The chart below highlights the basic differences between these two forms of dispute resolution. As we move through the arbitration chapter, many more differences will become clear.
|Can be voluntary or compulsory (court ordered)||Can be voluntary or compulsory (court ordered) |
|Trial is stayed (put on pause) pending outcome||Trial is replaced by arbitration|
|Generally involves a single mediator ||There might be a single arbitrator or a panel of arbitrators |
|Mediators need not have any formal legal training||Arbitrators need not have any formal legal training |
|Choice of mediator often has an important effect on the settlement reached ||Choice of arbitrator can be crucial, and especially in panel situations can lead to further litigation |
|Mediator’s function is to facilitate negotiation||Arbitrator’s function is to render a decision on the matter |
|Mediation ends when settlement is reached or when parties are deadlocked ||Arbitration ends when the decision is handed down |
|Agreements to mediate are generally enforceable, requiring the parties to make a good faith effort to arrive at a settlement agreement||Agreements to arbitrate are generally enforceable, requiring the parties to accept the arbitrator’s decision as if it were a court decision|