Alternative Dispute Resolution – Mediation and Binding Arbitration Options
One of the best ways to avoid the high cost of litigation and delay of time is through “alternative dispute resolution”.
Alternative dispute resolution is an alternative to going to court. It is not necessary to file suit to have the benefit of alternative dispute resolution. An individual agreeable to both parties acts as a mediator. The mediator is a disinterested third party who is skilled in getting parties to resolve their differences and thereby brings about a resolution of the dispute.
Each party in the process is typically represented by an attorney and often the attorneys can agree as to the identification of the issues, including the damages that are being sought.
Typically, each party sets forth a summary of the facts and identifies the issues as well as the amount of damages being sought and the opposing party describes the defenses and set offs that may exist. Then each party places this summary in writing and presents it to the mediator prior to the mediation session.
The mediator initially meets with both sides together and then works separately with each of the parties. Having a summary of information as well as direct contact with each party, the mediator can then utilize a number of techniques including an understanding of the case and of what is important to each party and the ability to assist both parties to find common ground to assist the parties in moving towards a settlement of their issues. Having first met with both parties together and then separately, the mediator then communicates with each opposing party and often the issues are resolved.
Alternative dispute resolution is considered by the courts as an effective way of resolving cases and judges often place the requirement that the parties participate in this mediation process in the Scheduling Order. The Scheduling Order is an order that establishes deadlines during litigation. Parties are required to participate in the mediation within a scheduled deadline.
Not every case referred to mediation results in resolution. Sometimes some of the issues are resolved and the remaining unresolved issues are litigated at the courthouse. If the parties do not reach an agreeable form of resolution, neither party is required to follow the recommended outcome proposed by the mediator.
Often alternative dispute resolution avoids the high cost of litigation and delays. It is typically very cost-effective. The parties equally share the cost of the mediator’s services, which cost is typically less than $600.
Another form of alternative dispute resolution is “binding arbitration”.
With binding arbitration, the parties go to a disinterested third party (the arbitrator) who hears the case as though it were tried in a courtroom however strict rules of evidence are not required.
Upon the completion of testimony from each of the parties, the arbitrator makes a decision and the parties must accept that decision. The arbitrator sets forth his or her decision in writing. As in mediation, the costs of arbitration are divided equally between the parties. Arbitration can be more expensive than mediation as a day of arbitration can run in the neighborhood of $1,200-$2,000. However, despite the costs of an arbitrator, typically binding arbitration is also very cost-effective.
Lawyers usually are familiar with the various forms of alternative dispute resolution and will recommend to their clients the use of mediation or binding arbitration as a tool to resolve their case.
I participate as a volunteer mediator at the District Court of Maryland for Howard County approximately 4 hours per month. On the day that I appear as a volunteer mediator, judges will assign to me cases that they think should be mediated. Each of the parties signs an agreement which includes the following: description of mediation, an acknowledgement that mediation is voluntary and that the parties can, at any time, decide they want to have the case heard before the district court judge. Further the signed agreement includes the terms that if, as, and when the parties come to an agreement, the agreement is placed in writing and presented to the Court and, at that time, the Court accepts the agreement and the parties are bound by their agreement.
Fred Antenberg is an attorney in Howard County, Maryland, providing legal services in surrounding Maryland counties and is familiar with both mediation and binding arbitration. Call Fred at 410 730-4404 to discuss how alternative dispute resolution may benefit your case.