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    June 28, 2019

    Mediation vs. Arbitration: What’s the Difference?

    Mediation vs. Arbitration: What's the Difference?

    When two parties are involved in a legal matter such as a divorce, personal injury claim or business dispute, they may prefer to resolve the issue without going to court. A process known as alternative dispute resolution (ADR) can offer an alternative to pursuing time-consuming and costly litigation.

    In South Carolina, all civil cases must undergo an ADR process. Negotiation is the first step, where the two sides attempt to work directly with each other (with or without attorneys) to reach an agreement. If negotiating still requires further discussion, the parties may then move on to mediation or arbitration.

    Learn more about the main difference between mediation versus arbitration below.

    What Is Mediation?

    Mediation is a process where the two sides try to settle a dispute with the help of an impartial third party, referred to as the mediator. This individual is often an active or retired attorney or judge or a professionally trained mediator. Rather than making rulings and forcing settlement, the mediator facilitates a discussion between the two parties and guides them to a mutually beneficial understanding.

    Benefits of mediation as an alternative dispute resolution technique include that it:

    • Fosters open communication that can often lead to a positive outcome with minimal discord
    • Focuses on problem-solving and resolution from the clients’ perspective
    • Saves time and is relatively cost-effective
    • Focuses on the best interests of both parties

    Mediation Contracts and Clauses

    Because of the many benefits of mediation, many contracts now include pre-suit mediation clauses. In case of a suit, these clauses allow all parties a chance to come to a mutual resolution. Pre-suit mediation clauses enable them to resolve conflicts without the need for lengthy court trials. And unlike a public trial, mediations can be resolved privately so the parties can avoid public attention.

    Many states, including South Carolina, now require alternative dispute resolution methods before most lawsuits can move to the court.

    What Is Arbitration?

    Arbitration is a more formal and structured ADR process than mediation. The court appoints a professional arbitrator to preside at a hearing where both sides make their case. The arbitrator then makes a ruling in favor of one of the parties based on the information presented during the hearing. The two types of arbitration are binding, which means both sides must abide by the arbitrator’s decision, and non-binding, which means they can either accept the ruling or pursue further legal action.

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    The benefits of the arbitration process include the following:

    • Like mediation, arbitration allows the parties to resolve the issue in private without going to court.
    • Binding arbitration provides finality, which is advantageous when both parties want to resolve the matter expeditiously and move on with their lives.
    • Both parties select the arbitrator, which increases the likelihood of viewing the ruling as fair and impartial.
    • The process is much less expensive than going to court.
    • The parties have the opportunity to define the issues the arbitrator will hear and rule upon.
    • Unlike a court trial, the parties can select the arbitration hearing’s day, time and place.

    The Mediator and Arbitrator Selection Process

    Both parties agree upon a mediator or arbitrator to rule over the proceedings in mediations and voluntary arbitrations. In many jurisdictions, the parties can select any person they deem qualified to act as an in-between. The parties typically have a three-week period to choose who they would like to moderate the process. If the parties have trouble agreeing on a candidate within the given period, the court will appoint a mediator or arbitrator from the Alternative Dispute Resolution Program Director’s roster.

    When selecting a mediator or arbitrator, it’s essential to consider their familiarity with the law. If the case is specific to a particular industry, it is also helpful for the third party to have a solid understanding of the industry. This person should be level-headed and capable of acting as an impartial in-between for the two parties. Finally, they must be absent of conflicts of interest regarding the outcome of the proceeding.

    What’s Best for You?

    In general, you should consider mediation before arbitration when settling disputes. Arbitration is a time-consuming process that can last days or even weeks. They are also high-stakes, which can make the process more stressful for all parties involved. Mediation, on the other hand, can usually take place in a single day. It allows both parties the opportunity to find an agreeable resolution to the issue. Successful mediation can even end with the satisfaction of both parties.

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    Note that in some circumstances, arbitration may be better for you. Binding arbitration can help quickly end complicated disputes that are likely to last even longer in court. Arbitration is more flexible than a court trial, allowing both parties to select dates and times that work for them.

    Whatever your situation, you should ask your attorney for advice. They will help you decide whether mediation or arbitration is a better fit for your case.

    Getting Help in Understanding the Difference Between Mediation and Arbitration

    If you’re in or near Charleston, South Carolina, and facing an alternative dispute resolution situation, Lauren Taylor Law can help. Attorney Taylor has extensive experience in handling mediation and arbitration matters involving divorce and other legal issues. She can assist you in exploring your options and pursuing the best course of action.

    Contact Lauren Taylor Law to learn more today.

    Summary
    Mediation vs. Arbitration: What's the Difference?
    Article Name
    Mediation vs. Arbitration: What's the Difference?
    Description
    Mediation is two sides try to settle a dispute by an impartial third party. Learn about how this is different form arbitration and about how these terms work in court.
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    Lauren Taylor Law Firm
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