Arbitration vs Mediation – Reaching an Amicable Separation Agreement

When we talk about divorce, the first thing that often springs to mind is the huge personal and financial burden that can come with it. But with the right preparation, these can be avoided.

There are numerous ways to negotiate through separation or divorce, whatever the circumstances, to reach a fair and equitable solution for both parties.

Alternative dispute resolution refers to a range of approaches, as alternatives to litigation that are considerably less emotionally charged and often conclude much faster than a court case.

Today, we’ll explain how arbitration and mediation work, the differences between the two, and why they may be suitable solutions to proceed through your separation.

Arbitration and Mediation Explained

We’ll start by comparing these two dispute resolution options.

Mediation means that the separating couple negotiates directly. The mediator is a neutral third party to help both parties reach an agreement, drawing on their expertise to offer guidance.

The mediator doesn’t make judgments but will advise on the strengths and weaknesses of any arguments or disagreements.

Arbitration is slightly different. While the arbitrator is still an impartial individual, in this method the arbitrator does make binding, final, decisions with the aim of settling disputes fairly.

Where there is a conflict that the parties cannot reasonably reach an agreement on, arbitration may be the best route to avoid litigation.

The Pros and Cons of Mediation

Mediation tends to be the fastest route to a resolution, often taking as little as a few days, compared to months or possibly years in a court case.

That equally means that the costs are considerably reduced.

While mediation involves a third party, the ex-partners retain control and aren’t reliant on a judge or arbitrator to make decisions.

Another advantage is that mediation is normally confidential, so the negotiations can be open and frank.

Disadvantages include:

• • The possibility that mediation will be unsuccessful. In this case, the costs may end up being higher since the parties will need to progress to arbitration or litigation.
  • You may compromise future litigation strategies during negotiations involving information sharing.
  • Parties that choose to be uncooperative may scupper the mediation results. Given that agreements aren’t always binding, it can be weaponised to build additional legal costs for the other individual.

Note that mediators can only work with the available information and cannot order either party to disclose documents or information they believe are relevant.

Therefore, mediation works well when undertaken in good faith but has some pitfalls if one party decides not to cooperate.

Legal Support With Mediation

Solicitors rarely attend mediation unless they have been asked to participate or manage discussions relating to costs in a low-value separation agreement.

As family law experts, The Law Firm Group supports clients with advising on the alternative dispute resolutions we think are most suitable for your circumstances and helping you understand the options, and likely legal outcomes, before making informed decisions.

The Advantages and Disadvantages of Arbitration

As we’ve seen, arbitration is a similar out of court alternative resolution method but involves a third-party arbitrator who makes decisions about the outcome of the process.

Technical divorce or separations requiring expertise often benefit from arbitration, such as a business dispute or an issue relating to contracts.

Arbitration, like mediation, is much faster than a court case and is usually more flexible and cost-effective.

Once there is a successful agreement the other party has limited opportunities to appeal, so it can be an optimal solution where you want a final outcome without much possibility to be contested.

However, that applies both ways. So you must be prepared to uphold the decision given by your arbitrator.

Arbitration Agreements

The process before arbitration includes an agreement or contract clause where both participating parties confirm that they will refer disputes and conflicts to the arbitration process for an arbitrator (or arbitration panel) to reach a binding decision.

Choosing arbitration doesn’t necessarily preclude court action, but the initial agreement will look at:

• • Appointing an arbitrator or arbitration panel.
  • The selection process for arbitrators.
  • Where and when the arbitration should occur.

One of the benefits here is that the individuals have a say in the structure applied to the arbitration and the procedures followed.

Until the agreement is formalised and the process begins, the separating partners can agree to amend or limit the extent of the arbitration, sometimes solely to resolve particularly complex or financial conflicts.

Choosing Between Arbitration and Mediation

Mediation offers an opportunity for ex-partners to reach agreements in an informal setting, although the outcomes are non-binding from a legal perspective.

A mediator doesn’t judge the case but supports dialogue and assists the parties in reaching a conclusion.

Arbitration is closer to a relaxed court process, where the arbitrator or panel makes a final decision, which both parties agree to comply with before the process starts.

Therefore the best approach for you depends on the situation, the complexity of the conflicts you wish to resolve and the attitude of both individuals towards reaching an outcome they feel happy with.

Mediation and arbitration may both be faster and less costly than court proceedings.

Still, there is a possibility that even after attempting an alternative dispute resolution method, the situation escalates to litigation.

If your separation or divorce has an element of confidentiality, such as discussing income from commercially sensitive projects or disclosing evidence that you wish to preserve away from the public domain, an alternative dispute resolution may be preferable.

Whatever is said in a mediation or arbitration meeting is kept between the parties and the official. Even if negotiations fall apart, the courts won’t consider any information shared before litigation.

Expert Legal Advice on Alternative Dispute Resolutions for Separations

For more advice about dispute resolution approaches in separation or divorce, please contact The Law Firm Group.

Our experienced, qualified family law solicitors can steer you through the options, recommending solutions that we believe are to your benefit and most likely to result in the successful outcome you are seeking.