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Most contracts state that in the event of a dispute, it must be referred to arbitration, usually by an advocate. This can be very expensive. A far better alternative is mediation. Here’s how it works –

The two processes are very different. The easiest to grasp is arbitration as it is clearly defined by the Arbitration Act.

Anyone can be an arbitrator as long as all parties to the dispute agree upon whom it should be.

The arbitrator determines the procedure and his or her job is to hear evidence from all parties, consider the facts and the law and then make a binding ruling.

This ruling cannot be challenged in court, unless the arbitrator was negligent.

Because he must consider the relevant law, it is normal to appoint an advocate for the job.

As an Internationally accredited financial mediator, I take a completely different approach.

A mediator’s job is to explore the underlying reasons for the dispute, which are often voiced in monetary terms, but may well boil down to hurt pride, invasion of privacy, feeling cheated, broken promises etc. He, or she, does this by interviewing the parties separately and in complete confidence. The parties will be in separate rooms and the mediator moves between them, gradually developing a sense of a win/win solution. He/she then subtly tests this idea on a “How would you feel if …?” kind of approach. With skill, the mediation can (and should) be over in two days or less and ends with the parties signing an agreement setting out the solution.

If the mediation fails, the case will usually then go to arbitration or litigation but the mediator cannot be forced by a court of law to disclose anything that was discussed during the mediation.

The fee for mediation is paid up front as there is no guarantee of success and is usually shared by the parties to the dispute.

Unfortunately, in my view, the courts are sometimes insisting that a case be referred to mediation before it is brought before the courts. This sets a negative environment with little chance of success as mediation works best when all parties are looking for a settlement rather than a fight.


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Looking for even more informative content? Check out the books I have written which have proved to be very popular.

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