Mediation & arbitration

Mediation and arbitration are powerful tools used to settle disputes without court action but they are very different things.

A mediator facilitates the negotiation process between two parties who voluntarily consent to find a solution to the problem. A mediator does not take sides and works to find ways for the parties to reach consensus, resolution and agreed compromise.

Arbitration is a process of dispute resolution and involves the appointment of an independent third party (who is usually an expert in the disputed area) who hears both sides of the dispute and then reaches a decision in favour of one party. In a practical sense, arbitration is quite similar to litigation – except that arbitrations are conducted outside of court.

Arbitration

  • A mediator is an independent third party
  • A mediator will assist parties to identify matters in dispute
  • A mediation will consider options for settlement
  • Mediation can enable settlement solutions that a Court cannot
  • Arbitration is more structured and formal than mediation
  • Arbitration can be more flexible and efficient than litigation
  • Arbitration can often be finalised sooner than litigation.

How does a mediation or arbitration operate? 

Many courts now require parties to mediate with a Registrar, to resolve or narrow the issues in dispute before incurring the cost of trial. In WA, almost all Supreme Court and District Court matters must go through a mediation process before they can move on to a trial and a final hearing.

Mediation is an opportunity for the parties and their lawyers to talk through a problem and reach their own agreement, with the support of a mediator, and allows parties to achieve outcomes that may not be available at trial.

Parties are not bound to settle at mediation, and it can occur multiple times for any dispute. An advantage of mediation is that it allows the possibility of all parties getting some form of outcome, where a final hearing or trial is usually just win or lose.

A mediator will speak directly to parties, and anything said will be confidential. Each party will have an opportunity to explain their position. Options for how to settle or agree are developed and explored and mediation can often take an entire day, or even longer.

 

Unlike mediation, Arbitration involves the appointment of an independent third party (the arbitrator) to make a decision on the dispute. This method requires each party to present their case and their evidence in an arbitration proceeding. Typically, the parties will also agree to treat the arbitrator’s final decision as binding by agreement, often well before the dispute arises because it is contained in a dispute resolution clause in their terms and conditions or other contracts.

The Australian Centre for International Commercial Arbitration (ACICA) is a dispute resolution body that offers arbitration and mediation services. A commercial contract can specify that ACICA will administer a mediation or arbitration session, meaning the relevant ACICA Rules will apply to the proceedings.

We are very experienced in mediation and arbitration and can guide you through either process, handling all aspects of the dispute and helping you gain the right outcome.

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