Mediation is the process by which a mediator, who is an independent, impartial, and respected third party (called a conciliator or mediator), tries to resolve a disagreement of the opposing parties by helping and supporting them to negotiate and agree on a solution.

There are a number of significant benefits of mediation compared to litigation or arbitration. 

1. Party’s Control of the Outcome of the Dispute:

In litigation and arbitration, a third party such as a judge or an arbitrator has definitive authority to give a binding decision on the dispute.  The judge or arbitrator requires the parties to make arguments and produce evidence, and will make a finding as to the facts based on the evidence and apply the appropriate law to the facts to reach a decision.

In mediation, the parties have the authority to decide how to resolve their dispute and choose a mediator to help and support the negotiations between the parties.  A Mediator does not have any authority to make a binding decision, but his/her skills are crucial for the success of the mediation process, to deal with not only legal issues or disputed matters but also emotional issues or future-oriented issues, with the goal of reaching a constructive resolution of the dispute between the parties. 

2. Cost-effective and Speedy:

Litigation and arbitration costs are usually highly unpredictable, involving expensive legal fees for litigation and arbitration as well as the fee for arbitrators.  Results can take from six months to a few years to be achieved. 

Mediation on the other hand, as a voluntary process, is controlled and arranged by the parties to fit their own timelines and usually involves just enough time for some preparation and a one-day mediation session.  The costs are consequently minimized and much more predictable for each party.

3. Greater Satisfaction:

In litigation and arbitration, parties focus on defeating the other party by arguing and producing enormous evidence.  As a war of attrition, regardless of the outcome, both parties are usually exhausted and often dissatisfied with the cost, stress, uncertainty and acrimony associated with the dispute. 

In mediation, a skilled mediator helps the parties focus on effectively communicating with each other and finding a mutually suitable resolution, as opposed to attacking one another and seeking the defeat of the other side.  Mediation aims at forging constructive solutions to the problems at the heart of the parties’ dispute, reinforcing the positive relationship between the parties, and often enabling them to continue working together in the future.

Even in cases when the parties cannot reach a settlement on the day of the mediation session, it is common for the parties to continue negotiating with their improved relationship following the mediation because many issues have already been discussed and the parties have the motivation to expand on the progress that has already been achieved.  

4. Confidentiality

In litigation, almost all arguments and evidence are part of the public record, so parties may be unable to keep the facts of the dispute and their important information confidential.  This may seriously damage the business and reputation of both parties.

In mediation, all information, discussions, evidence, etc. are completely confidential and the parties do not have to worry about the disclosure of their confidential information.