MEDOLA is a hybrid ADR mechanism that combines Mediation and Arbitration. It is designed to ensure a definitive resolution if the initial mediation fails.
The process typically follows these steps:
Mediation Phase: Parties attempt to reach a voluntary settlement with a mediator.
Transition: If mediation does not result in a settlement, the process shifts to arbitration.
Last-Offer Arbitration: In a classic MEDOLA setup, the mediator (now acting as an arbitrator) does not draft their own decision. Instead, they must choose between the "last best offers" submitted by each party. This incentivizes both sides to make highly reasonable, realistic offers during mediation to avoid the arbitrator picking the other party's proposal.
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