The "Legal-Ease" Glossary
This is a way for two parties to resolve a dispute out of court with the help of a neutral third party (the mediator).
A mediator actively participates in the discussion and directs both parties toward a fair agreement. Many people choose mediation over litigation because it's usually cheaper and quicker than going to court.
Many, but not all, mediations end with a settlement. Mediation should not be confused with arbitration, in which the neutral third party acts more as a silent judge than a third voice in the dispute's discussion.
Often, disputing parties prefer to settle their issues by way of mediation because…
- It’s more cost-effective for all parties involved. Though both parties will likely want their lawyers involved, the legal teams won’t have to prep for trial, which cuts costs considerably. Plus, you and the other party will split the cost of hiring a mediator.
- Both parties are likely to end up satisfied with the agreement. This is essential if you want to preserve a relationship with the other party.
- It’s quicker than litigation. A case that goes to trial can take years to resolve. Mediated cases can be handled in a few hours.
- It’s more informal than arbitration or litigation. There are no formal rules of evidence or procedure in mediation. Usually, the mediator and the disputing parties establish their own rules for how to proceed.
- Privacy remains intact. No parties are allowed to publicize what happens in the mediation room. Additionally, whatever is discussed can’t be used in court at a later date.
In some contracts, it makes sense to include a mediation or arbitration clause as part of a dispute resolution agreement. That way, you have a chance to work out issues before they become a full-blown lawsuit.
To learn more, read the blog post “How to Avoid a Malpractice / E&O Lawsuit after You’re Sued.”
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