Jan
22

Types of Out of Court Resolutions

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This article will help you decide if arbitration or mediation may be right for you if you would like to settle your case out of court.
- Zinda & Davis, PLLC, January 22nd, 2013

Published January 22nd, 2013


Types of Out of Court Resolutions

Filing a lawsuit and taking a case to court can be an expensive and time consuming way to reaching a resolution when there is a dispute.  Alternative dispute resolution options such as arbitration and mediation are popular alternatives to taking a case to court. 

Arbitration

In arbitration, the parties have agreed to have their case heard by an impartial person known as the arbitrator.  The arbitrator will schedule a hearing, listen to each side of the case, and then issue their final decision.  This decision can either be final and binding or nonbinding.

When seeking binding arbitration, the parties waive their right to take the case to court in the future and they agree to accept the decision of the arbitrator as final.  Parties cannot generally appeal an arbitrator’s decision even if that decision is not supported by the evidence presented or the underpinning law.  In nonbinding arbitration, the parties can appeal the decision and pursue or request a trial if they disagree and do not accept the arbitrator’s final decision. 

Arbitration is often quicker and less expensive than taking a case to court. It is also less formal than taking a case to court and the rules of evidence are more relaxed than in a courtroom.  Arbitrations are generally done on a voluntary basis and the parties often agree to participate in arbitration before a dispute even arises when signing a contract. 

Arbitration is best used when parties would like to avoid the formability, time and expense of trial.  If one, or both, of the parties want to control how the dispute is resolved however, then arbitration - especially binding arbitration – is not recommended.  The formal rules of evidence and trial may provide a more favorable outcome in these types of cases. 

Mediation

In mediation, an independent mediator will work with the parties to achieve a resolution of the dispute.  Mediators are trained to help the parties communicate more effectively with each other and to determine and accept a fair resolution of their dispute. A mediator does not decide the issue or make a final decision as in arbitration.  They are not authorized to make a final decision. 

A successful mediation will result in a legally enforceable written agreement that each party has signed and is legally bound to honor.  Failure to mediate an issue and come to an agreement will almost always result in the filing of litigation and the parties taking their dispute to court.

Mediation is recommended when the parties have a relationship that they would like to preserve, such as members of a family, business partners, even neighbors.  Mediation is particularly effective when emotional issues get in the way as they often can in close relationships.  A trained mediator can help the parties to communicate more effectively resulting in harm to the ongoing relationship.

Mediation may not work well when one of the parties is not willing to cooperate with the process or is unwilling to compromise on the issues.  It also may be ineffective when one of the parties holds a significant power advantage over the other party and is not recommended for disputes that have a history of victimization or abuse.

This article first appeared originally on this site:  RoundRockTxDivorceLawyer.com

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