Alternative Dispute Resolution: Mediation v Arbitration

If your case has started and you’re worried about the most effective strategy going forwards, our will provide a second opinion on the merits of your case and whether settlement can be reached without litigation. Instruct us to advise you on alternative means to resolve a dispute, be it through negotiation, mediation or arbitration at any stage of your case.

If you have a dispute that is subject to an arbitration clause, our team of alternative dispute solicitors and barristers have extensive experience in overseeing all manner of arbitration. We provide authoritative advise on single issue disputes to high value, complex cross-border disputes for individuals, SMEs and companies.

Our firm is unique in that we are based in a leading set of barristers chambers with access to top level QCs and we are based opposite the International Arbitration Centre.

What is arbitration?

Arbitration is a form of alternative dispute resolution where an impartial arbitrator makes a final and binding decision to settle a dispute between the parties. Arbitration is utilised as an alternative to litigation as means of resolving disputes without involving the courts.

Arbitration is fundamentally based on all parties agreeing to submit the dispute in question to arbitration, for example, by way of an arbitration agreement or a clause in a contract relating to the resolution of disputes.

Advantages of arbitration

• In disputes where the subject matter is highly technical, arbitrators with an appropriate degree of expertise can be appointed (for example in construction disputes).
• The arbitration process on the whole is faster than court proceedings (especially at the moment with the courts experiencing delays due to COVID-19).
• Arbitration may be cheaper and offer more flexible for companies.
• Arbitral awards are generally non-public and can be made confidential (unlike in litigation where judgments are publicly available).
• Arbitration awards are generally easier to enforce in other countries than court judgments.
• If you are successful in arbitration, there are limited avenues for the other party to appeal an arbitral award.

How does arbitration differ from litigation?

• Contractual foundation: arbitration is based on contract with the rights and duties of the parties to arbitrate arise from the contract itself.
• Location: the parties can choose the location of arbitration proceedings.
• Appointment of the arbitrator/panel: the parties are able to choose the arbitral tribunal.
• Primacy of confidentiality: arbitration is ordinarily confidental
• Finality of the decision: a decision by an arbitral tribunal is usually final and cannot be appealed (however a court may set aside an award in exceptional circumstances)
• Enforceability: tribunal decisions are widely enforceable given the primacy of a number of conventions such as the New York Convention

What is an arbitration agreement?

This is either a free standing agreement or a clause in a contract whereby the parties agree to refer any disputes between them for a binding decision by an arbitrator or arbitral panel chosen by the parties. An arbitration agreement does not necessarily preclude court proceedings (which will depend on the arbitration law of the seat of arbitration).

The arbitration agreement will determine important elements of the process, including the number of people on the tribunal, how the arbitrators are selected, where the arbitration takes place and whether the arbitration is conducted in accordance with the rules of a particular arbitration institution or whether it will be ad hoc.

What is mediation?

Mediation makes use of a neutral third party to find an agreement between parties, utilising their expertise. The mediator importantly does not form a decision on the case, they are there simply to facilitate an agreement. However, that is not to say that a mediator will not look at the facts of a case as they may be called to evaluate the strengths and weaknesses of a particular matter.

Mediation provides a forum for which parties can develop an understanding of their respective cases, enabling established or new options for resolution to be proposed

What are the advantages of mediation?

• Time: Whilst pursuing litigation can take months or years, mediation can be undertaken within a few days. This can pose a significant saving of time for your case.
• Costs: Similarly, due to the time savings, most matters can be resolved efficiently saving both sides significant costs.
• Control: With ADR the parties have control over how they proceed with their matter, as they can decide which form best suits their interests. For example, whether or not they want the decision to be legally binding.
• Confidentiality: Mediation is usually conducted confidentially, which enables full and frank negotiations.
• Business Relationships: Pursuing ADR as a form of reaching a settlement increases the likelihood of maintaining relationships, as settlements are reached with consent of both parties.
• Requirement: Parties in contentious disputes are required by the Courts to attempt ADR and may make adverse costs orders against parties which refuse.

What are the disadvantages of mediation?

• Costs: the double edged sword. Whilst mediation is seen as a method to save costs, if unsuccessful it will add time and costs to the dispute.
• Strategy: the risk with mediation is that you expose your litigation strategy by inadvertently releasing information to the other side.
• Voluntary nature: As mediation is a non-binding form of ADR uncooperative parties may use it as an opportunity to build legal costs and not act in good faith.
• Disclosure: mediators do not have the ability to order or require parties to disclose documents which may be essential to an effective mediation.

Should a solicitor attend mediation?

It is usual for your solicitors to attend the mediation (if instructed to do so), unless it is a low value claim and costs are an issue. Solicitors can serve a useful role in advising you on settlement proposals, which is particularly important in larger and more complex claims.

Why you should consider ADR

Time: Whilst pursuing litigation can take months or years, most forms of ADR can be undertaken within a few days. This can pose a significant saving of time for your case.

Costs: Similarly, due to the time savings, most matters can be resolved efficiently saving both sides significant costs.

Control: With ADR the parties have control over how they proceed with their matter, as they can decide which form best suits their interests. For example, whether or not they want the decision to be legally binding.

Confidentiality: The aforementioned procedures are usually conducted confidentially, which enables full and frank negotiations.

Business Relationships: Pursuing ADR as a form of reaching a settlement increases the likelihood of maintaining relationships, as settlements are reached with consent of both parties.

Requirement: Parties in contentious disputes are required by the Courts to attempt ADR and may make adverse costs orders against parties which refuse.

Our Alternative Dispute Resolution Service

We do things differently to other law firms in England & Wales. We will consider your case with you (no matter at what stage your case is at i.e. the pre-action stage, once a claim is issued, when pleadings are submitted, before a Costs & Case Management Conference, before a contemplated mediation). At any stage, if you are unhappy with the way your case is progressing, we provide an alternative dispute resolution service to consider the merits of your case, and if ADR is appropriate, we will transfer the handling of your case to us.

Book an Initial Consultation with Our Expert Alternative Dispute Resolution Lawyers

Our London Alternative Dispute Resolution (ADR) Solicitors and Barristers provide bespoke ADR and litigation advice. We invite you to contact us so one of our legal team can assess your dispute.

Our multi-disciplinary practice consists of dispute resolution specialist solicitors and barristers who have market-leading experience in handling multi-million pound litigation cases and have a proven track record of bringing complex claims to settlement though alternative forms of dispute resolution (“ADR”), when necessary.

We can subsequently provide urgent help, advice or representation from our expert team of leading ADR lawyers. Call or email us to start the process of instructing us; our ADR team are waiting to help.