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Format of Mediation
Mediation is a non-aggressive, casual forum to resolve a dispute. One person, called a mediator, will listen to both sides of the dispute in an informal setting. The mediator may ask questions, but it's typically for clarification purposes. No testimony is recorded. After the mediator hears both sides, the mediator will caucus or separately meet with each party. The mediator may go back and forth in an attempt to broker an agreement to resolve the dispute.
Format of Arbitration
Arbitration can be a more aggressive forum to resolve disputes. This type of proceeding may be heard by a panel of up to three people called arbitrators. Testimony is heard from both sides and may be recorded by a court reporter. Each side may make opening and closing remarks, and each party can be subject to cross-examination. Witnesses can be called to testify. Arbitration is generally governed by the Rules of Civil Procedure, but the proceeding is often considered more relaxed than a court hearing.
Jurisdiction
Mediation and arbitration can be mandated by contract or court rules, depending on what and how much is in dispute or if going to arbitration is voluntarily agreed upon by the parties. If not governed by contract or court rule, the location of the proceeding can be almost anywhere agreed upon by the parties.
Costs of Mediation and Arbitration
The costs of the mediator's time are usually evenly split by the parties. With respect to arbitration costs, a contract in force may dictate responsibility for the costs. Depending on the nature of the case, a local government may pay the arbitrators.
Finality of Results
In mediation, the mediator tries to facilitate a resolution. Any recommendations made by the mediator typically are non-binding on the parties unless agreed otherwise. If mediation is unsuccessful, the dispute could proceed to court. Arbitration awards can be non-binding or binding, depending on the understanding of the parties in the proceeding. If the arbitration is non-binding, either side, if unhappy with the award, can appeal to a court of jurisdiction to decide the outcome. When the decision of the arbitrators is binding on the parties, the decision is final. Both sides must accept and live with the judgment without any right of a court appeal.
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