What Is The Difference Between Mediation And Arbitration

Both mediation and arbitration are alternative dispute resolution mechanisms. How are they different from each other?
Posted 2 years ago  | 

3 Answer(s)

Prateek Kumar

Mediation is a type of negotiation where a third party, a mediator, helps the parties come to an agreement. The mediator’s suggestions are non-binding; the parties don’t have to accept the mediator’s suggestions and can in fact reject any proposals if they feel their own interests aren’t served. The mediator can meet with both parties at once or with each party separately. In contrast, arbitration involves a third party who listens to the case as presented by both parties. The arbitrator may be one person or a panel of persons. The parties sometimes choose the arbitrator and sometimes the arbitrator is chosen by a larger neutral third party. The arbitrator then makes a decision, which is binding on the parties. The arbitrator’s decision will be final unless the rules allow an appeal and both parties must abide by the arbitrator’s decision regardless of the outcome. Arbitration often looks like a judge deciding a case, except that the arbitrator doesn’t have to base his or her decision on law and the arbitrator’s decision is not a precedent for any future cases.

Vishal Kumar Thakur

- Mediation is nonbinding while arbitration requires both parties to be bound by the arbitrator’s decision.

- The parties have more control in mediation while the arbitrator is the decision making party in an arbitration.

- Mediation resembles a negotiation or settlement while arbitration looks more like a court proceeding, minus the judge, rules of evidence, and the court room trappings.

- Parties often go to arbitration because a contract directs the parties to arbitration. If parties go to mediation, it is more likely to be voluntary, although many courts, require parties go to mediation before any litigation. Many family courts are mandating mediation.

Ravindra Purohit
Mediation is a form of facilitated negotiation. In mediation, the parties meet (together and/or separately) with a neutral who helps them identify the key interests that are most important to them in resolving their dispute, and then helps them work toward a settlement that is acceptable to both of them. The parties own the entire process, and if a mediation is successful the parties write down their agreement at the end, sign it, and feel satisfied (even if not thrilled) with the agreed outcome, which they own. Arbitration , on the other hand, is much more similar to litigation, because the parties have no control over the outcome. In arbitration the parties take turns presenting evidence to a neutral third party , and at the end of the parties' arguments the neutral retires to consider the evidence - just like a judge - and hands down a decision, by which the parties are bound. Unlike litigation, most arbitration awards cannot be appealed, so they are 100% final unless the arbitrator obviously exceeded his or her authority in making the ruling. In arbitration the parties lose control of the outcome and when the ruling comes they may both hate it, each for their own different reasons.

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