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Arbitration is different from mediation, another form of alternative dispute resolution, because an arbitrator makes a decision deciding the dispute while a mediator attempts to facilitate a settlement among the disputing parties. A mediator has no power to force a settlement.
Arbitration is an out-of-court proceeding in which a neutral third party called an arbitrator hears evidence and then makes a binding decision. Arbitration is the most commonly used method of alternative dispute resolution (ADR), and you'll find an arbitration clause in the fine print of all kinds of contracts these days. Read on to find out whether you should include an arbitration clause in your agreement. Binding or Nonbinding Arbitration