Arbitrators undertaking a dual role of arbitrator and mediator should understand the differences between arbitration and mediation and the measures that will ensure the effectiveness of a dispute resolution proceeding that combines elements of both processes.

I.       introduction

Parties sometimes request a neutral to serve in two capacities—as arbitrator and mediator—for the same dispute. Such hybrid proceedings may involve a mediation followed by an arbitration if the mediation is unsuccessful (med-arb) or an arbitration followed by a mediation (arb-med). In one arb-med process, the arbitrator’s award is withheld from the parties pending a mediation before the same neutral. Another hybrid process may involve commencement of an arbitration, followed by a midstream mediation, and then completion of the arbitration (arb-med-arb) if the case does not settle. Sometimes the process may go back and forth between the two modalities depending on the needs of the parties and the nature of the dispute.

Some parties may favor certain hybrid processes because the use of a single neutral in one combined process may lead to quicker and less costly dispute resolution. Hybrid processes also may have the advantage over pure mediation of ensuring that the dispute will be resolved. Other parties may believe that the prospect of arbitration before the same neutral that conducts the mediation creates incentives for the parties to settle and that the knowledge gained by the neutral during the mediation may lead to a more efficient and less costly arbitration if the case does not settle. Hybrid processes also may be attractive when the amount at stake is relatively small or when the parties’ interest in preserving their business relationship outweighs winning the particular dispute.