Defining ADR Methods for CRE

Q: Today, many owners are using “alternative dispute resolution” (ADR) methods—mediation and arbitration—to resolve their differences with tenants out of court. How do mediation and arbitration differ?

A: The first difference is who hears the dispute. In mediation, a single mediator facilitates a discussion between the parties. But with arbitration, the dispute is heard by either one arbitrator or a panel of three arbitrators. The second difference is who decides the dispute. The mediator does not resolve the dispute, but helps the parties reach a resolution. The mediator has no decision-making authority and is really an “agent of reality” (or neutral), whose role is to get the parties talking and defuse hostilities so they can fashion their own resolution. But the mediator can propose solutions and use his knowledge and experience to help the parties resolve their differences. In essence, the mediator acts as an educator, a diplomat, a translator, an interpreter, and a communicator. With arbitration, the arbitrator or panel of arbitrators decides the dispute after weighing the merits of both sides of the dispute. For advice about which form of ADR is best for a property owner, type the article title “Know When to Use Specific ADR Methods”into the search field above.