Neutral third party mediator (or “neutral”) facilitates communication between parties and guides them in a voluntary settlement process.
Mediators do not impose a solution on the parties.
Requirements for mediators
If mediation is successful, a written settlement agreement between the parties follows; if not, the parties may proceed with litigation.
Description of the process.
Submission of a dispute to one or more impartial persons for a final and binding decision.
Process: submission, hearing, award
Parties may jointly select an arbitrator (or panel of arbitrators), subject to the arbitration provision in an existing contract.
Arbitration hearing is run like a trial, but with simplified rules of evidence.
An arbitrator’s decision (known as an “award”) is final and binding on the parties to the case (unless the parties have agreed to non-binding arbitration).
A contract may require the parties to the contract to submit all disputes to arbitration instead of litigation.
Arbitration clauses in contracts may specify choice of arbitrators and/or location of hearing, and may exclude some matters from the arbitration requirement.
Federal and state laws give courts the power to enforce arbitration agreements.
Widely used in banking, credit, brokerage, employment, and purchase agreements. Almost always used in labor union contracts.
Federal Arbitration Act reflects policy favoring arbitration...
Sec. 04: party may petition federal district court for an order compelling arbitration under an arbitration agreement.
Buckeye Check Cashing, Inc. v. Cardegna, (U.S. 2006) , p. 67.
Rule: A challenge to the validity of a contract as a whole, and not specifically to an arbitration clause contained in the contract, must be resolved by an arbitrator.
in consumer contracts that are oppressive for consumers.
NCR Corp. v. Korala Asoc., Ltd., (6th Cir. 2008), p. 72.
Rule: Under federal law, any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration.
Mandatory arbitration clauses in employment contracts are generally enforceable.
Some courts have overturned provisions in employment contracts requiring the parties to split costs when ...
Disadvantages of arbitration.
Court mandated mediation.
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