Dispute Resolution Management

One method is not necessarily preferable over the other. It all depends on the unique circumstances. The most important and crucial question to address is "What outcome best serves the interest?" 

Depending on the specific circumstances, arbitration could be an alternative to traditional litigation. However, it is important to strategize beforehand- If the parties have agreed to arbitrate a dispute in the contract terms, when the dispute arises, the parties should seek arbitration as agreed.  

Mediation is generally preferred because it is cost- effective, less time consuming and less disruptive. It also empowers the parties in the sense that the parties are "their own decision- makers". However, not all disputes or commercial relationships are "fit" for mediation. In a given specific circumstance, arbitration, litigation or another ADR method may be a more suitable avenue to pursue.