Mediation and arbitration are methods of alternative dispute resolution (“ADR”). Their purpose is to save time and money by resolving disputes without going to court. Mediation involves a neutral person who attempts to help the parties resolve their dispute through discussion and compromise. A mediator does not make rulings or decisions. Consequently, mediation is always informal and non-binding. Arbitration involves a neutral person who acts as a surrogate judge. An arbitrator considers the position of each side, and the applicable law then makes a ruling. The parties decide in advance whether the ruling will be binding or non-binding.

Most governing documents require some form of ADR, but there is wide variation regarding the type of ADR required and the situations where the requirement applies. Regardless of what the governing documents say about ADR, there are certain circumstances when the law requires at least an attempt at ADR as a prerequisite to beginning any legal process.