Cost Benefit Analysis
Clearly, use of Mediation as a first effort at resolving a dispute is the most cost effective. No formal presentation is required, the parties can prepare as much or as little as they believe necessary for a fair presentation of their case, and the cost is typically on the order of a few thousand dollars per side for the cost of a highly trained individual. Most mediations are completed the same day and the entire process from start (inception of the dispute) to finish (completion of the mediation) can be completed within 30 to 60 days.
Arbitration can also be effective but by its nature is still more time consuming than Mediation. Arbitration filing fees for Full Administered cases can run from a few hundred dollars to upwards of $50,000 for more complex cases. Arbitrator fees (different from the filing / administration fees) typically run $2,500 to $4,000 per day per arbitrator with each side generally paying one-half. The entire process from start (filing the Demand for Arbitration) to finish (receipt of the Arbitration Award usually takes between 4 to 11 months. While this may seem to be contrary to the concept of a fast resolution, compared to the typical 2 to 4 year time frame for resolving the same dispute through formal civil litigation – arbitration travels at the speed of light (courts generally work in terms of months and years, arbitration works in terms of days and weeks).