The Difference Between Arbitration and Mediation in California

The Difference Between Arbitration and Mediation in California

What is the difference between arbitration and mediation in California?  Do you need legal representation for a mediation and/or arbitration?  Arbitration and mediation are Alternative Dispute Resolution or ADR options versus going to trial over a business dispute, business litigation or a lawsuit.  The Watkins Firm has represented clients in mediation and arbitration as ADR attorneys in San Diego for more than four decades.  You should definitely have skilled, experienced representation when entering either a mediation or arbitration.

The Watkins Firm takes a unique approach to resolving disputes and business litigation.  The most effective strategy for resolving a business dispute or lawsuit is effective, leveraged negotiation.  Watkins Firm attorneys work to create a well-documented, thorough chronology and a mastery of any associated damages.  Our attorneys are able to negotiate a settlement that resolves the matter or helps the parties to move through the dispute and achieve the “benefit of the bargain” they originally intended in the vast majority of our business dispute cases.  When negotiation is unable to resolve part or all of a dispute, a lawsuit is often filed by one of the parties, and a settlement conference, mediation and arbitration are usually the next alternatives to consider.  Each has advantages and disadvantages, and our attorneys guide our clients through these decisions to put them in the best position to accomplish their goals and objectives.

Mediation is usually the fastest and least expensive tactic when compared with arbitration or trial before a San Diego Court.  In a mediation, a neutral third party expert (mediator) is selected by the parties in the dispute.  The mediator works with each party separately and then often collaboratively with the parties and their representation to identify potential solutions and seek agreement.  Mediation is confidential and does not become part of the public record.  This format is much less structured from a legal perspective, and the parties and our counsel have strong influence over the outcome in a mediation.  The recommendations of the mediator are not binding, and the mediator cannot enforce a settlement.  This is the potential disadvantage of mediation: you may invest the time and cost to mediate an issue and not reach resolution.  However, most mediations are able to resolve or settle at least part of the issues at hand, if not the entire matter.

On major difference between arbitration and mediation is arbitration is a much more structured legal environment.  Much like mediation, the parties select a third party neutral expert (arbiter) to hear the case.  The rules of motions and many other legal strategies which delay proceedings and add cost are eliminated in arbitration.  The Watkins Firm and the other party’s attorney will usually submit a brief to the arbiter outlining our positions in the dispute.  The arbiter will interview witnesses, gather testimony and evidence and render a decision.  You should never go to arbitration without the expert legal representation of the Watkins Firm.  The decision of the arbiter is final and binding, and can only be appealed if there is substantial evidence of fraud or collusion on the part of the arbiter and the other party.  This is very, very rare.  Your risk or contingent liabilities are substantially higher in arbitration, but usually much lower than if you pursue the case in Court.  The advantage of arbitration is you know the dispute will be resolved at the end of the arbitration.

Dan Watkins Founding Partner of the Watkins FirmPro-Tip: “In mediation, you bring in former superior court, like, Judge Jones. And he’s going to go back and forth and have the purpose of settlement on his mind, which is what we both want. And a lot of times here’s the thing why don’t settle. I’d say 50% of our cases don’t settle at mediation, but after a good mediation a month or two later, it’ll settle because of the mediation. Some mediators actually call us a month after when we came so close and say, Dan, what can I do? Do you want me to call the other side? I’ll say, yeah, good idea. Call the other side. And then he’ll call the other side. And they’ll their clients have calmed down. They’re relaxed and we’ll settle.  

Arbitration is when you have an agreement in your contract that says, I’m going to resolve this by arbitration and it’s usually quicker and cheaper, but you waive the right to a jury trial and the arbitrator himself can be very expensive. But in the long run, waiting to go to trial for two and a half years and waiting for a judge who has an overburdened docket can be just as risky.

So arbitrations are great. They cut to the chase and you really don’t have a lot of time for dramatics. You have to have accurate law and facts when you go in and it’s usually decided by your arbitration brief because the judge knows when he sees a case that has no merit or has great merit. So there’s a lot of different ways using the ADR formula to your benefit. Understanding them gives you the best result in 95% of the cases, which is how the Watkins firm has such a strong track record of resolving our client’s cases while protecting their goals and objectives.” – Dan Watkins, Founding Partner

Now you have a general overview of the difference between arbitration and mediation in San Diego and Southern California.  The decision to pursue mediation or arbitration is case specific and driven by the facts. We invite you to review our podcast Episode 11 – Resolving Business Disputes as well as the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.