Negotiation, Mediation, Arbitration

Mediation and Arbitration: Introducing Canada’s “Med-Arb” Rules

Med-arb: A hybrid approach to Alternative Dispute Resolution

Comprised of negotiation, mediation and arbitration, most Canadians have heard of Alternative Dispute Resolution (ADR) before. However, the new term “med-arb” is set to become more familiar this year. In December, the ADR Institute of Canada saw their med-arb guidelines approved with new rules that are in the final polishing stages. The first country to release guidelines of this kind, this means there will soon be a formal hybrid approach to dispute resolution that combines the advantages of both mediation and arbitration.

Is med-arb even a new concept?

While the forthcoming official med-arb guidelines are a world first, a fusion of mediation and arbitration is not a new concept. Since dispute resolution processes are tailored to the parties involved, some practitioners have already experimented with med-arb with applications varying by province. However, the new guidelines will forge a greater understanding for everybody involved.

How does med-arb work?

Firstly, disagreeing parties must first agree on the terms of the med-arb process itself. After that, the parties will attempt to reach a settlement through mediation. In isolation, this is the process whereby an unbiased third party helps find a mutually agreeable solution. Usually, when mediation is unsuccessful, disagreeing parties move to arbitration. With med-arb however, the mediator can assume the role of an arbitrator before making a binding decision based on his or her judgements. This differs from regular arbitration where both parties can choose whether an arbitrator’s decision is binding or not.

What are the advantages of med-arb?

Advantages of med-arb include speed of resolution. Since the mediator can make a binding decision, disagreeing parties will be more eager to reach an agreement. Should this occur, the arbitration phase of med-arb is rendered unnecessary. Med-arb is more cost-effective than traditional ADR methods, too. Since one person plays the role of both mediator and arbitrator, arbitration doesn’t need to start fresh. This saves time and money for the parties involved.

What are the disadvantages of med-arb?

In regular arbitration, all case details are confidential between arbitrator and one party. In med-arb however, the mediator-turned-arbitrator may experience a blurring of what’s confidential information and what’s jointly shared information. This could potentially lead to each party withholding confidential information that could influence the mediator-turned-arbitrator’s final binding decision. Parties could skirt this issue by choosing traditional mediation and arbitration rather than med-arb. However, this would involve higher costs.

When will Canada’s med-arb guidelines be published?

Currently, there is no set date for when the ADR Institute of Canada’s med-arb guidelines will be published. A hot topic since the framework was drafted last July, Canadian practitioners are watching on keenly. It’s costly for individuals to experience unresolved conflict and disputes. The new med-arb guidelines won’t suit everyone but at least they’ll provide disagreeing parties another way to reach a resolution, avoiding litigation in turn.

To determine if ADR methods are right for you, read our recent blog or contact Sicotte Guilbault today. Our professionals have many years of experience working Alternative Dispute Resolution cases. We take time to understand the uniqueness of your situation and will choose the approach that best suits you.

by: Stéphane Hutt - Partner
posted on: March 20, 2020