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 in which the parties to the dispute participate in the selection of the fact finder (arbitrator) and the time table for events of the hearing to occur. 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, however there is the greater risk of having much higher costs awarded against the losing side. Furthermore, the parties still have the uncertainty of result 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 does not decide what facts are correct and what are wrong, nor does he decide who is at fault.  So in arbitration the arbitrator decides for the parties, in mediation the mediator facilitates the parties deciding for themselves.

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