Alternative dispute resolution (ADR) methods like arbitration allow you to resolve disputes between you and another party without going to court. We answered some frequently asked questions about arbitration to help you decide if it is the best for your case.
What Is Arbitration?
Arbitration is a legal process where parties agree to submit their disputes to one or more arbitrators who will make a binding decision on the dispute. Arbitration is a contract-based dispute resolution method. This means that parties must have an arbitration agreement before any of the parties can refer the dispute to arbitration.
What Is the Difference Between Arbitration and Mediation?
Both arbitration and mediation are alternatives to litigation, but they have some major differences. In arbitration, the arbitrator(s) will analyze the case and the evidence before them to arrive at a decision. The decision, which is called an award, is binding on both parties.
However, in mediation, a neutral, trained mediator works to help the disputing parties agree on their own. Mediators do not make decisions or rulings. Rather, they help the parties reach a consensus. The agreement only becomes binding on the parties when they sign it.
What Is the Difference Between Arbitration and Conciliation?
In arbitration, the neutral third party makes a binding decision after analyzing the case and the evidence. Parties rarely control the outcome. However, in conciliation, the work of the neutral third party, known as the conciliator, is to facilitate communication and negotiation between the parties to help them settle.
Also, arbitration is still adversarial. Parties present their case to get the arbitrator(s) to rule in their favor. However, conciliation is more collaborative, and the goal is to get the parties to communicate and negotiate.
Is Arbitration Legally Binding?
Yes. Once the arbitrator(s) issues an award, it is binding on the parties and it’s enforceable.
What Are the Advantages and Disadvantages of Arbitration?
Arbitration as a form of ADR has its pros and cons.
Advantages of Arbitration
Some of the advantages include:
- Speedier resolution of disputes: Because parties have more flexibility and control in scheduling hearings, they can resolve disputes faster.
- Confidentiality: Arbitration hearings are private, unlike litigation, which is open to the public. The confidential nature of arbitration proceedings allows parties to keep sensitive information about their business away from the public eye.
- Cost: Because parties can decide how fast they want to resolve disputes, arbitration proceedings generally cost less than litigation.
- Binding Award: Arbitration awards are usually final and binding. This provides a degree of certainty and closure to the dispute.
Disadvantages of Arbitration
Legal arbitration still has some disadvantages, including:
- No appeals: In most cases, the arbitration decision is final, and there is no formal appeals process. So, even if you believe the outcome was unjust or biased, you cannot appeal it.
- Limited discovery: The discovery process in arbitration is limited compared to court litigation, which could affect your ability to gather evidence.
- Limited remedies: In some cases, arbitrators may not have the authority to grant some specific types of remedies, which may be what you seek in a case.
Although arbitration is a great way to resolve disputes, it may not be ideal for all types of cases. If another person’s negligence has injured you, the best option is still to hire a personal injury lawyer to help you pursue compensation. They can do so by negotiating a settlement with insurance companies or filing a lawsuit in court. Our experienced personal injury lawyers at Morris & Dewett Injury Lawyers are ready to help you seek justice in your case. Contact us to discover how we can help.