Arbitration is an effective way of obtaining a final and binding decision on a dispute or a series of disputes, without reference to a court of law. It is a private method of resolving disputes and the jurisdiction of the arbitral tribunal is derived solely from the express or implied agreement of the parties. Parties who agree to arbitrate disputes renounce their right of recourse to the courts of law in respect of any such dispute. Arbitration differs from mediation and from the courts of law in a number of ways.
Mediation is a process of ‘facilitated negotiation’. It is not focused on determining who is ‘right’ or who has the law on his or her side. It is focused on coming up with the best solution that both parties can accept. It is about finding a ‘win-win’ solution. Mediation is about engaging in a constructive exchange. Therefore it takes place exclusively on a voluntary basis, and the entire process is non-binding for the parties up to the moment they resolve to sign the settlement.