A binding mediation is a negotiation between two or more adverse parties with a neutral party acting as a mediator. Often retired judges act as mediators. The plaintiff and defendant enter the negotiation with the judge acting as a go between and the parties try to reach a settlement. If a settlement cannot be reached, the judge steps in and decides a fair amount to award the plaintiff for his or her injuries sustained in the accident.
An arbitration is a hearing where an arbitrator, or panel of arbitrators, act as judge and jury. The arbitrator(s) hears testimony and looks at evidence, and then makes a finding for the plaintiff or the defendant. If the arbitrator finds for the plaintiff, he or she will then decide the amount of money to award.
An arbitration or mediation can be very beneficial to both plaintiffs and defendants / insurance companies. For a plaintiff, it can save time and money. It can often take years for a lawsuit to make its way through the courthouse. A mediation or arbitration can shorten the wait from years to months for a resolution. Further, it is much less expensive to go to arbitration than to put on a trial in court.
Defendants and their insurance carriers also save greatly on litigation expenses with arbitration or mediation. Further, insurance companies can limit their exposure. Mediations and arbitrations have high/low dollar limits which are predetermined by the parties.
For example, an arbitration involving a personal injury auto accident may have a high/low of $25,000 to $100,000. This means the plaintiff cannot be awarded greater than $100,000 and cannot be awarded less than $25,000. If the arbitrator comes back with an award of $120,000, the plaintiff can only be awarded the high figure of $100,000. But, if the judge finds the defendant not guilty, the plaintiff still receives the low figure of $25,000. Both sides have limited their risk by agreeing upon a high and low dollar amount.
Motor vehicle insurance policies call for binding arbitration on uninsured and underinsured motorist claims (UM claims) if a settlement cannot be agreed upon by the parties. The high would be the limits of the insurance policy and the low would be zero, unless the parties agree to some other figure. If an accident has left you injured, we are standing by 24 hours a day, seven days a week to take your call locally at (312) 924-7575 or toll free at (855) LAW-CHICAGO (529-2442). We offer a free case consultation to all injury victims without any obligation on the part of the person who was injured. Do not wait if you have been injured - call us now and let us help you.
If you have a case you think would benefit from arbitration or mediation, request a Free Case Consultation or call (855) LAW-CHICAGO to speak with a lawyer now.