Mediation is a non-binding Alternative Dispute Resolution procedure for the settlement of disputes. "Non-binding" means that you control the outcome and are not required to settle your case. Although there is a trained mediator who "facilitates" the proceedings, there is no Judge (or Arbitrator) making a decision or imposing his or her will upon you. The mediator is neutral and will remain impartial in the proceedings, meaning that they do not "sides." You retain control as to whether, and, if so, under what terms, the case settles. The matters discussed at the mediation are confidential, so you cannot generally subpoena the mediator to testify and you cannot use what one party says (or doesn't say) at the mediation against them in Court. In a typical mediation, if the parties are not able to settle their case, then the parties still have the ability to go to the Judge for a decision.
Mediation has been a very successful method for resolving disputes in divorce and other family law cases (which could include paternity cases, modifications, enforcement actions, grandparent rights cases, and child custody cases). The only proviso is that the parties (and their attorneys) must genuinely intend to put forth a good-faith effort to settle their disputes. Most mediators also do not take mediation cases when there have been allegations of domestic violence during the relationship. In most divorce and family cases, the reality is that the parties know each other very well and -- despite what is commonly said during these highly charged cases -- have the ability to resolve their disputes peacefully and fairly. The legal proceedings are no different. Additionally, when there are children involved, the parties will have to deal with one another for many years after the legal case ends. Therefore, the amicable settlement of the dispute is very important.
Another realistic observation that can be made from sucessful mediations is that the parties are much more likely to comply with a settlement that is reached by agreement, than with a Court's order that is arbitrarily imposed upon a party.
Most of the time, the mediator will begin the proceedings in one room with all of the parties (although in some highly-contentious case, the parties stay apart the entire mediation). In the joint session, the mediator will lay out the ground rules and then allow each party (or their attorneys) to make a position statement. Although each mediator may handle things slightly differently, most attorney-based mediation models then separate the parties out into different "caucus" rooms. It is at this point that the mediator will meet with each side separately to learn more about the case from the perspective of each party. Once the mediator has a relatively good grasp of the case from each side, he or she will keep going from room to room in an effort to settle or "compromise" the case. A compromise is just that -- not the ideal outcome, but something that can be lived with in an effort to settle the dispute. If an agreement cannot be reached then at some point, the mediator may declare an "impasse."
If, however, an agreement is reached, then the Texas mediator will reduce all of the agreements to writing so that there is no confusion about what deal was struck. If all of the issues in the case are dealt with at the mediation, then usually the parties will be able to obtain Judgment based upon the written settlement agreement.