In many lawsuits, conducting hearings for a verdict by the judge or jury in court may not be feasible for the plaintiff, defendant, and the legal department. During such situations, alternative dispute resolutions, such as arbitration and mediation, have become increasingly popular as they help save time and resources that are required for a courtroom trial.
Arbitration and mediation employ a neutral third party to supervise the legal process. Arbitration is generally hosted with a panel of arbitrators who hold a responsibility similar to a judge. They hear arguments of both parties, analyze evidence, ask for testimony, and then announce a verdict. This process is more formal than mediation, but allows more leeway than a court would.
Mediation, on the other hand, is generally conducted with a single mediator who does not judge the case but simply facilitates discussions and the eventual resolution of the dispute. A mediator’s role is to assist negotiations for parties who are motivated to settle, but perhaps, are unable to settle on money or other key issues.
Read on to know the answers to some of the important questions that may arise if you’re opting for mediation or arbitration approach.
1. What Is the Key Benefit of Mediation and Arbitration?
Resolving disputes outside the judicial system can be easier for both parties. One of the key benefits of these approaches is that the lawsuits can be resolved quickly and easily, whereas litigation can remain pending for hearing, and go on for a long period of time.
The rules of evidence and procedure that are mandatory for arbitration and mediation proceedings are usually more relaxed than those of litigation. Both parties are in a better position to settle on a mutually acceptable judgment with the help of an arbitrator/mediator.
2. Is There Need for Legal Guidance?
Alternate dispute resolution processes generally do not require a lawyer. In fact, the advantage of mediation or arbitration lies in the possibility of avoiding the fees of hiring an attorney. If you aren’t confident about handling the legal procedures by yourself, you can always opt for a lawyer to help you through them. Attorneys are often hired by people in the context of arbitration, as it is a more formal alternative to litigation.
Mediation is a suitable option for most non-criminal matters. Even some non-violent criminal cases, like those of verbal harassment, can be handled successfully with mediation. In the mediation process, you may want to hire a lawyer as a consultant who can offer you professional advice on your case. This can even be substantially cheaper than hiring a lawyer to litigate your case.
3. Should One Opt for Mediation or Arbitration?
Sometimes, people opt for mediation as a non-binding process and arbitration as a binding one. In non-binding processes, the decision announced by the mediator/arbitrator cannot be imposed on any parties in the form of an enforceable award. It entirely depends on the unique facts of a case whether mediation will be more effective than arbitration.
You may want to follow the advice from one of the leading Albany mediation lawyers before opting for either of the two alternative dispute resolution approaches. He says, “A mediator’s role is to facilitate talks between parties who are motivated to settle but perhaps far apart on the money or other key issue. In arbitration, both sides submit their positions to an arbitrator who renders a decision as a ‘jury of one.’ The binding decision can be converted to a judgment.”
4. What Are the Consequences of Agreeing to Arbitration?
Arbitration is more commonly used in cases involving large businesses and consumers, wherein consumers sign agreements for buying/using certain products/services. These agreements include clauses that say they will arbitrate plausible disputes rather than go to court.
The consequences of accepting arbitration chiefly depends on the nature of the dispute. For instance, if you are giving up an opportunity to go to court for suffering personal injury or incurring damages, then you may not want to agree to arbitration. You may have to pay the tremendously high cost of going to court, as attorneys are more inclined to take such cases on a contingency-fee basis, where jury verdicts can be obtained.
Alternate dispute resolution can be a boon for people who don’t wish to risk their reputation during the litigation process. But, when opting for arbitration or mediation, you need to be alert and ask the right questions to the neutral party before deciding if you should agree to the arbitration clause or negotiate your way out of the deal. If you are involved in a legal situation that can be managed using alternate resolution, then it is advisable that you speak with an attorney who is trained in this area of the law before making the final decision.
Cory Bowman is associated with the marketing division of E. Stewart Jones Hacker Murphy Law firm. He has specialized in developing unique and high-quality content for law practices, which can help the entire community.