Mediation vs. Arbitration

Mediation vs. Arbitration

Fort Mill, SC Personal Injury Lawyer

When someone decides to file a lawsuit, it can be lengthy and a financially draining process for both parties. However, there is an alternative to litigation called alternative dispute resolution (ADR). The most common forms of ADR are mediation and arbitration. Both forms are generally faster and less expensive than litigation and can be effective at resolving issues between two disputing parties. But, there are some important differences between mediation and arbitration that you need to know.

What is Mediation?

Mediation is a process that brings in a neutral third party, a mediator, to help negotiate a settlement between two parties. The mediator stimulates discussion to facilitate an agreement that resolves the dispute between the two parties. The mediator does not, however, make any decisions. It is up the two parties to agree on a settlement. The mediation settlement is non-binding and does not restrict the parties from pursuing litigation on the matter—unless the two parties have chosen to be bound by the terms of the agreement.

What is Arbitration?

Arbitration is also a process that brings in a neutral third party, an arbitrator. Arbitration allows two parties to settle a dispute outside of the court system. The arbitrator acts like a judge and jury on the matter by reviewing both sides of the dispute and making a final decision. The arbitrator’s decision is legally binding and can only be appealed under special circumstances. While similar to litigation, the overall process is less formal than litigation while being more formal than mediation.

Similarities

Mediation and arbitration have several things in common.

  • Both use a neutral third party to reach a settlement between the two disputing parties.
  • Both occur outside of the traditional court system.
  • Both are generally faster than litigation which makes them less expensive than going to court.
  • Both proceedings are confidential and do not become a matter of public record.
  • Both require voluntary participation from the two disputing parties (unless there is a court mandate or the parties have previously signed a mediation or arbitration contract).

Differences

There are key differences between mediation and arbitration that significantly affect control of the process and each party’s ability to contest the settlement.

  • Decision-Making: An arbitrator makes the final decision on a case while a mediator acts more like a facilitator to help the two parties come to an agreement on their own. Arbitration is less formal than the traditional court system but is much more formal than mediation. An arbitrator acts similar to a judge and jury, while a mediator allows the two parties to have more control over the process and merely guides the two parties to reach an agreement.
  • Settlements: An arbitrator’s final decision is legally binding with limited circumstances for an appeal. On the other hand, a mediation settlement is not legally binding unless the parties specifically request mediation that is binding.
  • Participation: Generally, when two parties enter mediation, their participation is voluntary and they can withdraw without completing the process. In arbitration, parties can only withdraw before final decisions have been made on the case and only if there is no signed arbitration contract. However, it’s important to note that in instances of court-ordered mediation and arbitration, or signed mediation and arbitration contracts, parties must follow the specific stipulations of their contract or court order.

Contact the Personal Injury Law Firm of Bice Law

The personal injury firm of Bice Law will examine your case to determine the type and amount of damages that your injury warrants, including payments for medical expenses, lost income, pain and suffering, and any permanent disability.  We’ll determine whether an out-of-court settlement or trial is the best strategy to obtain maximum benefits for you or your family. If you have suffered injury or harm because of someone else’s actions, take the first step to protect your legal rights – contact the personal injury firm of Bice Law serving both North and South Carolina. You only have a limited time after your injury to file a claim, so act quickly.  Call (855) 5-BICE-LAW today or submit an online request  to get a free consultation with a  personal injury attorneyWe serve families across both North Carolina and South Carolina.  Results are how we measure success – we’ve built a strong reputation both in and out of the courtroom, and we’ll put our experience and expertise to work on your behalf.

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