What is the difference between Mediation and Arbitration?

Previously, parties in litigation have proposed more frequent use of arbitration as an alternative method to the courts, to resolve disputes. Arbitration is a forum outside the courts which is stipulated by the Arbitration Act. The parties to the dispute participate in the selection of the fact finder (arbitrator) and the timetable for the events of the hearing. Like litigation, arbitration is an exploration of the facts with the arbitrator acting as the fact and fault finder. Arbitration procedures and rules are more flexible and less formal than the courts but the costs and time associated with this process may not be significantly different than litigation, and there is also a greater risk of much higher costs being awarded against the losing side. Furthermore, the parties still have the uncertainty of what the result will be and, once instigated, the parties lose control of the process.

With mediation, the mediator is a neutral non biased person that facilitates negotiation between the parties. He or she does not decide which facts are correct and which are wrong, nor does he or she decide who is at fault. So, in arbitration the arbitrator decides for the parties. In mediation, the mediator facilitates the parties to decide for themselves.

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