While arbitration is a form of alternative dispute resolution, it is more analogous to litigation than it is to mediation. Arbitration is inherently adversarial where rigid results almost always end with a winner and a loser. Moreover, parties engaged in arbitration allow others to decide their fate and do so on “the record”, and without the benefit of confidentiality. The process can also be very costly and lengthy.

Mediation is inherently a win/win process because no one loses. The parties voluntarily participate in a non-confrontational and confidential dialogue while always retaining control of both the process and outcome. Mediation is simply the best alternative to litigation. It is a cost effective, informal and relatively quick way to resolve a dispute.

While resolution is the first goal of mediation, success or failure should not be judged on settlement alone. Mediation provides an open and confidential environment promoting the disclosure of pertinent information that would only otherwise be obtained through the rigors and expenses of civil discovery. The parties are able to narrow the issues which in turn will reduce the costs of any further litigation.

Perhaps most important, as a neutral third-party, a mediator can help open otherwise closed lines of communication, break an impasse, and encourage the parties to think “out-of-the-box” to identify creative alternatives, all of which maximize the potential for the parties to reach a mutually agreeable resolution.

In traditional mediation the mediator serves primarily to facilitate discussion between the parties and may, when appropriate, become more evaluative providing a third party perspective on issues relating to fact, law and the risks and benefits of bringing the matter before a jury. Traditional mediation usually begins with a joint session where, with everyone involved in the mediation present, each party presents its respective case. After the joint session, the mediator will meet separately with each of the parties in confidential caucuses. These caucuses provide a safe environment for the parties and their counsel to candidly discuss with the mediator their view of the case. Ideally, these caucuses will continue until the parties reach a resolution that will then be documented in a settlement agreement and signed by the parties before leaving the mediation session.

In some cases, the parties reach an impasse in their negotiations, but still want to resolve their dispute without further expense or litigation. There are several alternatives the parties can explore which can be employed successfully to break an impasse and resolve a matter. These same alternatives employed under the wrong circumstances however can serve to further complicate negotiations and drive parties further apart. Accordingly, it is imperative that the mediator and parties fully contemplate the potential risks and benefits and only consider these types of alternatives as a “last ditch effort” to resolve a matter. Examples include:

The mediator meets with the parties separately and provides them with a proposal to resolve the matter. The parties must respond by a specified time by either accepting or rejecting the proposal. If all parties agree, the case is resolved. If one or more parties reject the proposal and there is no resolution, none of the parties is told how any of the other parties responded. Accordingly, in the event the matter is not resolved each party maintains its negotiating position.

Each party agrees to write down a final proposal for resolution and present it to the mediator. The mediator then chooses one of the proposals, which becomes binding on the parties. Because a mediator is unlikely to choose an unreasonable proposal, there is a strong motivation for the parties to be reasonable.

The mediator writes down a proposal to resolve the matter. Each party then writes down and submits its’ own proposal for resolution. The proposal most similar to the mediator’s is then binding on all parties and becomes the basis for a formal written agreement.

©2003 Todd A. Smith ESQ. All Rights Reserved.