Alternative Dispute Resolution: Mediation

Alternative Dispute Resolution: Mediation

In a dispute, parties may be unable to resolve their outstanding issues because of their inability to find common ground. Litigation can be competitive and turn into a zero-sum game, where one group benefits and another doesn’t. Lawsuits may not be the best manners in which to resolve disputes. 

Our legal system provides other methods of dispute resolution, including negotiation, mediation and arbitration, that can all be done by the parties themselves or under court supervision. This presentation will focus on the mediation method of dispute resolution.

Mediation is negotiation facilitated by a neutral third party, called the mediator, who does not have a stake in the outcome of a dispute. Instead, the mediator helps the parties find common ground and assists with drafting a settlement agreement.

What is mediation?

Mediation is a key part of the civil litigation system in both state and federal courts, and is an integral dispute resolution tool for disputes involving federal agencies.[1] The most common disputes that lead to mediation are those involving contracts, family law matters, and personal injury or employment disagreements.[2] In a survey of U.S. business leaders, many recognized mediation’s advantages and preferred mediations in commercial transaction disagreements, even over other alternative dispute resolution methods. Specifically, the executives surveyed in the study believed that mediation preserves commercial relationships better than arbitration and that mediation was superior to arbitration in saving time and money.[3]  

Mediation can be an informal meeting that only lasts a couple hours, or can be a scheduled settlement conference that lasts an entire day. This meeting can be held at a neutral location, such as the mediator’s office. Mediation is voluntary to both parties and is nonbinding, meaning that the mediator cannot force either party to follow a certain course of action, or do something that either refuses to do. This distinguishes mediation from an arbitration, where the arbitrator, like a judge, can hand down a decision that binds the parties to follow a course of action.

Who is the mediator and what is her role?

Because mediators have no decision-making authority and cannot impose a decision, there are no legal requirements on who can serve as mediators.[4]

The mediator is, however, typically a trained professional who has extensive qualifications that allow her to foster settlement and assist the parties in negotiating a settlement that is tailored to meet each side’s needs. Due to mediation’s widespread popularity, both the American Bar Association and the Association for Conflict Resolution have assisted many states in designing mediator certification standards.[5] to become a certified mediator, mediators may be required to have a minimum of 20 to 50 hours of general mediator training and mediation experience either as a co-mediator or observer.[6] While there is no requirement that parties use certified mediators, mediators with this level of training are often more effective. Parties often have enormous resources invested in a dispute and the marginal additional cost of a certified mediator is usually considered acceptable considering the increased chance of a successful resolution such a mediator may provide.

This neutral third party helps parties reach a mutually agreeable settlement by identifying issues, exploring areas of agreement, and finding areas of compromise.[7] Typically, the mediator will allot time to each party to provide an account of the circumstances that have led to a dispute. After this accounting of the facts, a mediator helps each party discover shared interests and discover resolutions that can promote mutual gain.

What are the benefits of mediation? 

Mediation has numerous advantages over litigation, arbitration and negotiation without use of a mediator.  First, lawyers, judges, and other decision-makers find that one of the greatest benefits of mediation is that it can foster cooperation and understanding. Mediators examine the causes of conflict and develop solutions. To reach a successful conclusion, the parties must collaborate with one another. Litigation, by contrast, is more likely to breed hostility and mistrust between disputing parties because the parties are competing with one another to “win.”

Second, mediation is a cost-effective way of resolving a dispute.[8] It is much less expensive than litigation and it offers a relatively predictive cost, all of which is paid to a mediator. In Arizona, for example, trained mediators typically charge around $250 per hour.[9]  Litigation fees can be exorbitant not only because of attorney’s fees, but also because of fees associated with filing a suit and paying ancillary litigation costs.

Third, a mediation can be a much quicker process than litigation. Mediations aren’t cumbersome processes and each mediation session may last two to three hours. This is especially helpful in family law cases, where prolonged law disputes can have psychological and emotional costs for the children involved. Studies have found that trials, which can take months to prepare for and weeks to conduct, have a detrimental effect and cause tension for children.[10]

Fourth, mediation provides a confidential forum for resolving disputes. Private information that may have to be revealed to the judge, jury, or public during a trial remains private during mediation since mediation is conducted behind closed doors.[11] Furthermore, while the ultimate decision in a trial becomes part of the public record, an agreement reached by the parties can remain private. Mediation’s privacy can be especially appealing to divorcing spouses or if the facts underlying a dispute are of an intimate nature.

Finally, mediations put dispute resolution into the hands of the disputing parties. Since there are no complex rules of procedure and evidence, parties have a great deal of flexibility and can adjust the breadth of the mediation to discuss whatever topics that they think are important.

Mediations, though with many benefits, are not always the best way to resolve a disagreement because parties sometimes need a legally-binding outcome that will create obligations to solve their problems. Despite this, a mediation can often help settle controversies while also decreasing aggression and animosity between parties.