Expert: Timmy Chou - 11/24/2008

Question
Can a party harm its own case during arbitration proceeding?

Answer
Thank you for your question!

As I always mention to questioners, mediators act as neutral third parties to disputes and never "get involved" in judging the merits of conflict, but merely use special techniques to help the parties decide how to negotiate their own settlement.

In my experience there is a wide variety of arbitration customs and procedures.  I have have seen more differences than similarities across venues, industries and states.

A party can certainly harm its own case in an arbitration.  Some arbitrations are more like a mini-trial.  In these venues you should be prepared to argue your position and potentially to refute the other sides' argument.  Other arbitrations are more of a negotiation and can take on more of a character of "splitting the difference".  You will be wise to speak with people who have participated with the particular process before to get clues about how things are likely to be conducted--and prepare accordingly.

In all my answers, and for your information, the pros and cons of the types of dispute resolution are provided below.

GOOD LUCK!


Arbitration, Mediation, and Litigation

Arbitration: the referral of a dispute to one or more impartial persons for final and binding determination outside of the judicial system

Benefits of Arbitration:

    Confidential, no public record
    Limited exchange of documentation, information
    Quick, don't have to wait for a court date
    Arbitrators have expertise in the subject matter and are trained in conflict resolution
    Cheaper than litigation
    Preserves business relationships

Negatives of Arbitration

    It's a compromise, no %100 winner
    Complex arbitration can be costly
    If not satisfied, may litigate the arbitration procedure
    Poor results with an unskilled arbitrator
    Both parties must agree to cooperate in the process

Mediation: the process by which parties submit their dispute to a neutral third party (the mediator) who works with the parties to reach a settlement of their dispute.

Benefits of Mediation:

    Neutral mediator can objectively suggest alternatives not considered before
    Parties are directly engaged in negotiating the settlement
    Can be quicker than litigation
    Less costly than litigation
    Preserves business relationships
    85% of American Arbitration Association cases mediated find successful solutions

Negatives of Mediation

    may not reach a binding decision
    unskilled mediator

Litigation: using the judicial system to resolve disputes

Benefits of litigation:

    a clear winner and loser
    uses a prescribed set of procedures
    more predictable outcomes
    is final

Negatives of Litigation:

    waiting for court dates can do more harm
    usually more expensive than mediation and arbitration
    part of the public record