Terms such as “mediation” and “arbitration” are used often in the news, whether in discussing labor negotiations or sports contracts. These terms are also used with great regularity in many kinds of litigation. So, what are these processes and how are they different from a typical trial?
First, mediation and arbitration are both forms of alternative dispute resolution. The term “alternative” refers to the fact that the dispute is resolved by some means other than a trial before a judge or jury.
While mediation and arbitration are both alternatives to trial, they are very different from one another. Mediation is a conference in which the parties and their lawyers work with a trained mediator to try to settle the case. The mediator works as a facilitator, assisting the parties in trying to find common ground and a way towards settlement. Resolving a case through mediation is entirely voluntary, which is to say that a case does not settle at mediation unless all of the parties agree to do so. In North Carolina, all civil suits are required to go through the mediation process. It is typically an informal process, and has proven to be quite successful. If a case does not settle at mediation, it goes on to a traditional courtroom trial.
Arbitration differs from mediation in that the trained arbitrator (or arbitrators), actually decides the outcome of the case. Depending on the basis for the arbitration, it is typically presented to one or three neutral arbitrators. They hear evidence from the parties, through their lawyers and witnesses, review evidence, and make a decision. If a panel of three arbitrators is used, 2 of them must agree on the outcome. Arbitration is much like a trial in that a decision is imposed on the parties after the evidence is presented, but it is typically must faster and more efficient than a formal trial in a courtroom. Some civil cases in North Carolina are required to go through an arbitration hearing from which either party can appeal. Some contracts also contain provisions that require any dispute to be submitted to “binding”, or non-appealable arbitration.
Sumrell Sugg has attorneys who are certified as both arbitrators and mediators, and we’ve also represented many litigants in the course of both proceedings. Let us know if you have any questions or if we can assist you.