When a dispute arises, going to court is not always the only available option. Some disputes may be resolved through mediation — a structured process in which the parties attempt to reach an agreed solution with the assistance of an independent mediator.
What is mediation?
A mediator helps the parties communicate, understand the issues and explore possible solutions.
The mediator does not decide who is right or wrong and cannot impose a settlement. The parties remain responsible for deciding whether to settle and what terms they are prepared to accept.
How is mediation different from arbitration and litigation?
| Feature | Mediation | Arbitration | Litigation |
|---|---|---|---|
| Who determines the outcome? | The parties | The arbitrator | The court |
| Role of the neutral person | Helps the parties negotiate | Hears the dispute and makes an award | Hears the case and gives judgment |
| Is a decision imposed? | No | Yes | Yes |
| Usual outcome | Agreed settlement | Arbitral award | Court judgment |
| Nature of process | Cooperative and flexible | Adjudicative | Adjudicative |
| Privacy | Generally private | Generally private | Conducted through the court system |
| Preserving relationships | Often helpful | Less collaborative | Usually adversarial |
In litigation and arbitration, each party presents its case to a third party who determines the outcome. Mediation instead allows the parties themselves to develop and accept a solution.
When may mediation be suitable?
Mediation may be useful where:
- the parties have an ongoing business, professional or personal relationship;
- both sides want to avoid the cost and delay of prolonged proceedings;
- confidentiality is important;
- the dispute involves more than a simple question of who is legally right;
- a practical or commercial solution is needed;
- the parties want greater control over the outcome; or
- court proceedings have already begun, but settlement remains possible.
Examples include disputes involving unpaid invoices, contracts, the supply of goods or services, construction projects, partnerships, leases or family-owned businesses.
What solutions can be reached?
Depending on the dispute, the parties might agree on payment by instalments, revised deadlines, completion or correction of work, return or replacement of goods, a new commercial arrangement, an apology or clarification, confidentiality obligations, or an agreed conclusion to their relationship.
These solutions are possible because mediation allows the parties to consider their underlying interests — not only their strict legal positions.
When may mediation not be appropriate?
Immediate court action may be necessary where urgent interim protection is required, evidence or property must be preserved, or a party needs an authoritative judicial determination.
Mediation may also be ineffective where a party participates only to delay proceedings, refuses to provide necessary information or has no genuine intention of exploring settlement. Any serious imbalance between the parties must also be considered and appropriately managed.
Does agreeing to mediate mean accepting a compromise?
No. Agreeing to participate in mediation is not the same as agreeing to settle.
A party may attend, consider the available options and decide that no acceptable settlement is possible. If mediation does not produce an agreement, the dispute may proceed through the appropriate legal process.
A different way of approaching disputes
Mediation does not replace the courts or arbitration. Each process serves a different purpose. Its value lies in offering parties an opportunity to resolve a dispute through informed discussion and voluntary agreement.
Continue this series
Mediation Is Assisted Negotiation
Preparing for Mediation: What to Do and What Not to Do
Sri Lanka’s New Civil and Commercial Mediation Law
Note: This article provides general legal information and does not constitute legal advice. Advice appropriate to the circumstances of the particular dispute should be obtained where necessary.
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