Q: What is the difference between arbitration and mediation in a construction case?
I am a construction firm with a client who has not paid me - $150,000 plus interest. Our contract calls for arbitration. The home owner (who is a lawyer) wants to do mediation. Is this a good idea?
A:
Mediation involves sitting down and trying to come to a mutually agreeable compromise. Usually both sides pay a mediator's fee in advance so if both sides want mediation, it suggests that both sides want to explore compromise.
The arbitration contract you refer to is binding, meaning at the end of the arbitration the arbitrator issues a decision that both sides have to accept.
If you are not willing to compromise and think you have a strong case you want arbitration. If you recognize weaknesses in your case and don't want to place yourself at the mercy of an arbitrator, consider mediation.
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