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Dispute Resolution > Arbitration / Mediation


Alternative Dispute Resolution

Alternative dispute resolution is one of the newest ways of solving legal disputes between parties in a timely manner.  Most lawsuits are not only expensive, but they also take years to reach some type of resolution.  Parties to private civil disputes are more frequently opting to resolve their disputes privately so as to avoid the rigors and time of litigation.  Basically, depending on the form of dispute resolution that the parties choose, alternative dispute resolution is like having a private trial.  The parties typically agree to split the costs of an arbitration or mediation so that they can hopefully resolve their disagreement in less time than with formal litigation.  However, in some cases alternative dispute resolution can be more expensive because the parties have to pay for the arbitrator’s time as well as for their attorney.  Still, if the parties need the dispute resolved quickly, they may opt for paying more in order to resolve the dispute in a shorter period of time.  Normally, when parties are unable to reach a settlement of the dispute without litigation, one of the parties files a lawsuit.  That party has now incurred the cost of filing a Complaint, which in Pima County Superior Court is $185.  Then, the party filing the lawsuit must serve the opposing party with notice of the lawsuit, which adds additional costs to the amount already spent to file the lawsuit.  If there is more than one defendant or there is a problem serving a defendant, the costs increase.  This is in addition to the fees that a party must pay his, her or its attorney for their time in pursuing litigation.  These fees can be prohibitive and run into the tens of thousands of dollars depending on the nature of the lawsuit and the contentiousness of the parties involved.  There are essentially two types of alternative dispute resolution for parties to choose from:  arbitration and mediation.  All forms of ADR are voluntary unless they are court mandated.  This means that the parties must voluntarily agree to some form of ADR either in a contract or after the dispute has arisen.  If there is no contractual agreement for ADR prior to the dispute arising and the parties cannot agree on ADR, the parties will have no alternative, but to file a lawsuit.  In addition, the outcome of ADR is only binding if the parties agree to have the outcome bind them.  In both arbitration and mediation, each party writes a position statement regarding that party’s position of the case and it is sent to the arbitrator or mediator prior to the ADR proceeding.  ADR proceedings are usually held either at the mediator/arbitrator’s office or an attorney’s office and are typically very informal.  Arbitrations and mediations are not public proceedings and therefore confidential.  The differences between arbitration and mediation are listed below.

  
Arbitration

Arbitration is the most favored form of ADR as it provides a resolution to the dispute at the end of the proceeding.  What this means is that no matter how unreasonable a party to a dispute is, the arbitrator makes a final decision at the end of the arbitration and the matter is resolved.  Arbitration works a lot like a trial, but is less formal.  Each party comes to the arbitration and is allowed to present evidence and witnesses.  The other party is allowed to cross-examine witnesses and present evidence.  At the end of the arbitration, each party is allowed to make a closing statement and the arbitrator renders his or her decision like a judge or jury would at the end of a trial.  If the parties have entered into an agreement to make the arbitral award binding, the arbitrator’s decision will act as a judgment and the dispute is resolved.  Typically, parties may not appeal the arbitrator’s decision to a court unless the arbitrator has behaved inappropriately in the extreme.  Therefore, parties must be willing to abide by the arbitrator’s decision.  This is much the same as a trial, but there is the right to appeal the decision at the trial.  However, typically parties will not appeal a case as it means more time and money to fully resolve the dispute. Litigating in court carries no guarantee of a particular outcome and neither does arbitration.  However, even though arbitration may be more costly than a trial, parties may chose arbitration for a highly technical matter.  The parties choose their arbitrator so they are able to choose an arbitrator with expertise in a certain technical area so the parties spend less time educating the arbitrator about the subject matter of their case.  In addition, if the parties need to fully and finally resolve their dispute rapidly they may choose arbitration so that the matter is resolved as quickly as possible.

  
Mediation

Mediation is a form of ADR that attempts the parties to voluntarily resolve their dispute.  If the parties are already involved in litigation, they can request a mediation with the court (called a “settlement conference”) or if they are not involved in litigation they can agree to a mediation prior to filing a lawsuit.  The mediator does not impose an outcome at the end of the mediation and acts only as a facilitator for settlement.  In addition, the parties usually enter into a confidentiality agreement so that the parties may speak freely without fear that the information provided may be used against them in court.  Typically at the beginning of the mediation, the parties are separated into two rooms.  The mediation begins with one of the parties stating his or her side of the dispute to the mediator.  The mediator then discusses the position with the other party.  The mediator goes between the two parties to discuss solutions to the dispute. The mediator is impartial and will not make an opinion regarding the facts of the dispute.  The disadvantage to mediation is that if one party is not willing to compromise at all there may not be any settlement.  Parties need to be willing to compromise their positions in order for a mediation to be successful.  If either party is unwilling to compromise, mediation will more than likely fail.  Although it seems as though mediation is not a good alternative to resolve disputes as there is no guarantee of a definitive outcome, parties have found great success in resolution of differences through mediation.  Trained mediators are adept at facilitating settlements even with the most stubborn of parties.  Mediation is also often effective because the parties may agree to anything they want to settle the dispute.  For example, parties may agree to a payment plan instead of a lump sum payment of a claim.

  
 
Disclaimer
The information provided in this website is meant only as a general description of the current laws as of the date of the writing. It is not meant to be an exhaustive discussion of all the nuances of the law and is intended to be only an overview. Many issues may appear simpler than they are, and an individual should always contact an attorney to obtain a complete, accurate interpretation of the law given the individual's particular circumstances. Thompson Law Group, P.C. makes no representations as to how the law would affect a particular situation and intends only to illustrate areas of concern and give general information.

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