Arbitration vs. Mediation

Due to the risk and expense associated with jury trials, alternative dispute resolution (ADR) has become a popular alternative to resolving personal injury lawsuits. The two most common forms of ADR are arbitrations and mediations. My clients sometimes confuse these two terms, so I think it is important to clarify the similarities and differences between these procedures.

Arbitrations are essentially mini-trials that take place outside of the court system. Essentially, the parties of a lawsuit will agree to waive their right to a trial in favor of letting one or more mutually-agreeable people (usually retired judges or other experienced attorneys) decide their case. Arbitrations can be a popular alternative to trials for several reasons. One reason is that they can take significantly less time than a jury trial, in part due to the elimination of jury selection. Arbitrations may also lead to more predictable results than a jury trial, because the parties will often cap the upper and lower limits of the arbitrator’s decision.

Mediations are similar to arbitrations insofar as the parties will choose a mutuallyagreeable individual (a mediator) to help resolve their dispute. However, the mediator does not hear evidence and then issue a binding decision on the case. Instead, the mediator’s role is to help the parties negotiate a settlement that everyone deems acceptable. In the personal injury context, the mediator will usually try to get the plaintiff to reduce their monetary demands, while simultaneously getting the defense to raise their offers. If negotiations stall, a mediator may give his opinion as to the value of the case, but neither side is obligated to follow the mediator’s recommendation as to a fair settlement figure.

Depending on the facts of the case, these forms of ADR can be useful tools in attempting to resolve lawsuits quickly and fairly.