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It's The Law: Mediation Or Arbitration Can Resolve Dispute

Q: A friend of mine is in a big lawsuit. He told me the judge ordered the case to arbitration. I had a court case once that was ordered to mediation. I am not sure how the process is different. Can you explain?

A: Over the past 20 years, popularly appears alternative dispute resolution has become very popular among Florida judges, based upon many factors. Judges are often over whelmed with work load and delay in hearings and trials results. Most judges also believe that settlement is preferable to trial, in that the parties have some control over the outcome of settlement and a negotiated agreement is more likely to be followed than an edict by the judge. In addition, trials are expensive and require considerable judicial resources, not the least of which is the time required of jurors in jury trials.

There are many more qualified mediators and arbitrators today than 20 years ago, as the Florida Supreme Court has adopted and encouraged training and experience requirements for mediators and arbitrators. Consequently, judges routinely assign cases to either mediation or arbitration, and in some cases both, in an effort to resolve the dispute prior to using court time for trial.

In mediation, a mediator attempts to cajole the parties to a voluntary settlement of their dispute. In arbitration, an arbitrator renders a decision. A settlement agreement at mediation is intended to be final and takes the place of a judgment. A decision in arbitration is also final, but can be subject to appeal or, if the parties do not agree that the decision will be binding, either party may request a trial as if arbitration did not take place.

Mediation is the most common alternative dispute resolution ordered by a judge. The judge may order all or part of a contested civil matter to mediation. By Supreme Court rule, the parties have 10 days to agree on a mediator. If the parties cannot agree, the judge may appoint a mediator.

Mediation must be started within 60 days of the court’s order. Each party, or a representative having full authority to settle, along with the parties’ counsel of record must attend the mediation. To encourage settlement, mediation communications are confidential and cannot be used in court unless confidentiality has been waived or very limited exceptions under the statute are met.

At mediation, each party presents a summary of their position and the mediator than attempts to negotiate a mutually agreeable settlement. If successful, the case is finished. If not successful, the case proceeds to trial.

Arbitration involves presentation of each party’s position to an arbitrator, who renders an ultimate decision. Unless the parties agree, a court can only order the parties to non-binding arbitration. If either party is unhappy with the arbitrator’s decision in non-binding arbitration, that party can request a trial de novo, and the case is heard by the judge as if arbitration did not happen.

Parties can always voluntarily agree, or agree by contract, to binding arbitration. The decision of an arbitrator in binding arbitration is similar to that of a trial judge and is subject to appeal on only limited grounds.

As with mediation, the parties have 10 days from date of order to agree upon an arbitrator. If the parties cannot agree, the court appoints an arbitrator. In order to minimize expense and expedite proceedings, court rules provide for a streamlined procedure in non-binding arbitration. In non-binding arbitration, most of the evidence is presented in summary form by the attorneys for each party. Little or no testimony is presented. In binding arbitration, the proceeding is conducted similar to a trial.

Unlike mediation, arbitration proceedings are not confidential. In fact, any party may have a record and transcript made of the arbitration hearing.

The arbitrator is required to issue a written decision within 10 days of conclusion of the arbitration hearing. If a party is unsatisfied with the decision, he may request a trial de novo.

There is some risk of requesting a trial de novo. If the plaintiff requests a trial and obtains a judgment which is no more than 75% of the arbitration award, the court may award the defendant attorney fees and costs from time of arbitration through trial. If the defendant requests a trial de novo and judgment against the defendant is at least 25% more than the arbitration award, the judge may award the plaintiff attorney fees and costs.

In both mediation and arbitration the parties usually pay the mediator equally or arbitrator fee equally. If the case is resolved through the alternative dispute resolution substantial cost of trial are avoided and the dispute is ended.

Court ordered mediation and arbitration has replaced attorney to attorney negotiation in most cases. Some argue the procedures do not result in more settlements, but merely replace the older method of negotiation and settlement. Nevertheless, they appear to be here to stay. As with all litigation matters, representation by qualified counsel is important.

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