Mediation is a common way parties try to resolve a dispute before it results in a formal lawsuit or goes to trial. This often involves getting the parties together in the same building (not usually the same room) with a mediator (an uninvolved third party, often a lawyer). The mediator does not decide the case or make rulings like a judge but rather listens to what the parties have to say about their claims and helps them come to an agreement/settlement.

When mediation is successful, the parties have reached an agreement on how to resolve their dispute. Typically, the mediator will draft the agreement, and the parties will sign it.  At that point, the parties have a contract about how they agreed to end the dispute.  That contract is legally binding and can be enforced in court if either party fails to comply. 

Typically, when the parties agree to a mediation, they also agree to share the cost of the mediator.  However, mediation offers flexibility, so the final mediated agreement between the parties could specify a different method for the mediator’s fee to be paid.

The best aspect of mediation is that the parties have control over the outcome.  During mediation, the parties can work out a solution that they can agree upon.  During traditional litigation, parties must live with the decision made by the judge or jury.  Additionally, because the parties can engage in mediation at any time, they can resolve the matter more quickly and possibly at a lower expense.

Alternative dispute resolution (ADR) refers to a process that resolves a dispute in a manner other than through a formal trial in a courtroom. The most common forms of ADR are mediation and arbitration.  In mediation, the parties are encouraged to reach a joint resolution; the mediator does not decide the case but instead guides the parties through their issues.  In arbitration, the parties agree to be bound by the arbitrator's decision; the arbitrator is neutral and determines how to resolve the issue after hearing from both sides.