Mediation vs arbitration: an analysis to determine which is more effective as mode of dispute resolution.

Abstract

The progressively global nature of the economy increases the probability of conflict amid geographically and culturally separated persons from diverse nations. Although court action is the most traditional resort, arbitration and mediation have gained popularity as viable alternatives. Arbitration involves the legally-binding settlement of a dispute outside the legal system by an independent party while mediation also involves an independent third party, who is normally a facilitator in reaching a consensus and the opinion of the third party is not inflicted on the clashing entities. Whether a dispute it settled by arbitration or mediation largely depends on the nature of the disagreement, the characteristics and desires of the parties involved and the viability of other methods of dispute settlement. The study will research on literature related to alternative dispute resolution, arbitration and mediation .It will look at cases/disputes in 2009 so as to enable investigation of the study's objective; which is to find out which method between arbitration and mediation is more effective and hence more preferred as a means of dispute resolution. The paper will also investigate the challenges facing mediation and arbitration and give recommendations.