Lawyers and courtrooms have always been popular fodder for television shows and movies. Overly dramatic cross-examinations and closing arguments have romanticized the concept of the jury trial.
Many personal injury litigants who have seen Hollywood’s spin on our legal system, expect their case to be resolved in the courtroom by way of a dramatic jury trial. A trial can be an intimidating exercise for litigants situated on either side of a personal injury lawsuit. Most clients are surprised to learn that the vast majority of cases are settled before a trial actually takes place.
Alternative Dispute Resolution (ADR) is a broad category of practices and procedures used by lawyers and judges to resolve lawsuits without the necessity of a full-blown trial. Mediation and arbitration are two of the most common types of ADR. However, personal injury clients often misunderstand the distinction between mediation and arbitration.
What Is Mediation?
Mediation is an informal process whereby a neutral person called a “mediator” attempts to help the parties to a lawsuit settle the case prior to trial.
The parties to the lawsuit mutually agree upon a specific mediator. Mediators are typically lawyers or retired judges. The mediator is generally paid by the hour for the time that he/she spends assisting the parties. The parties usually share in the expense of the mediator equally unless an alternative agreement is reached at the mediation.
Mediation typically takes place at a lawyer or mediator’s office. The lawyers, parties, and mediator spend substantial time meeting both together and separately to discuss a potential resolution. The goal of the mediator is to guide the parties to an agreeable settlement. Mediators use different techniques to facilitate settlement. But generally, most mediators attempt to highlight the underlying strengths and weaknesses of each party’s case so as to bring to light the inherent risk both parties face in proceeding to trial.
Mediation is an entirely voluntary process. However, some judges will order the parties to a lawsuit to participate in mediation prior to trial. Nevertheless, the mediator does not have the power to force a party to settle against their will. A settlement achieved at mediation is simply an agreement between the parties, much like any other contract.
Mediation is typically a good option for litigating parties that are amendable to compromise in an effort to avoid their case being decided by a judge or jury.
What Is Arbitration?
Arbitration is procedures whereby the parties to a dispute agree to have a third- party called an “arbitrator” resolve their dispute for them in private – rather than within the public court system. Arbitrators, like mediators, are usually lawyers or retired judges.
Arbitration is typically a more-simplified version of a trial involving a different set of evidentiary and procedural rules. Prior to arbitration, the parties agree to follow a particular arbitral institution’s existing rules, such as the American Arbitration Association.
After each party to the dispute is provided with the opportunity to present their side of the story, in accordance with the agreed upon rules, the arbitrator decides who wins the dispute and what if any damages will be awarded.
Most arbitration is binding. In other words, an arbitrator’s award is enforceable in a court of law if the losing party fails to comply with the terms of award. Unlike, the public court system, arbitration typically provides for very limited rights of appeal after an arbitrator’s award.
The inclusion of arbitration agreements in many consumer agreements has come under fire. Often, consumers unknowingly sign contracts that contain arbitration agreements and in so doing waive their constitutional right to access the courts.