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How are arbitration and mediation different?

On Behalf of | Dec 15, 2020 | Business Law |

Florida business owners know that it is always preferable to avoid litigation if at all possible. Litigation can be extremely expensive and result in ruined business relationships. 

There are two major ways to settle disputes between feuding parties without litigation. These are mediation and arbitration. According to FindLaw, mediation is a guided conversation about the dispute between the parties whereas arbitration is a replica of the trial process. 

What is mediation like?

Mediation typically involves representatives from the feuding parties as well as a single mediator. This mediator does not deliver judgment on the case at hand, but rather guides a conversation about the dispute between the two parties. The idea is that with the assistance of the mediator, the parties will be able to negotiate their own remedy to the issue. 

Additionally, mediation is usually non-binding. This means that if one of the parties is not satisfied with the outcome of mediation they may decide to take the case to trial regardless. 

What is arbitration like?

Arbitration involves a single person or panel of people acting as judges. Typically arbitration is binding, which means if one party is not happy with the remedy the arbitrators suggest, there is little further recourse. In fact, in some situations it is more difficult to overturn the decisions made by an arbitrator as compared to the decisions made by a judge. 

Arbitration is typically much faster than traditional litigation and since the parties have a hand in deciding who the arbitrator is, in some instances arbitration can be a superior option. This is because you can choose a subject matter expert to hear the case rather than a neutral law expert who may lack subject knowledge (the judge).