With regards to forms of alternative dispute resolution, or ADR, arbitration is one of the most widely popular methods ascribed to for resolving all types of disputes. The process of a solution stemming from arbitration begins with a dispute between two or more parties. The disputing parties will then seek the, through their mutual agreement, an impartial arbitrator, who will be the third party making the decision of the resolution of the dispute. Arbitrators will hear both parties statement, observe evidence, and hear all arguments from both parties involved in the dispute and render a decision based on these factors.
Typically, arbitration is only applicable to civil cases, which involve individuals and parties in a civil dispute, which can potentially stem from a criminal action. Arbitration can occur inside the courts, where it is known as judicial arbitration, or arbitration can occur outside the courts, where it is referred to as commercial or private arbitration. Generally speaking, dispute resolution via arbitration is one of the most preferred methods by businesses involved in a number of industries due to the clear advantages of the arbitration process. Some of the major American industries that frequently engage in arbitration to resolve outstanding disputes include:
Even the vast majority of local, state, and federal courts will uphold decisions reached through private arbitration. For this and other reasons, the decisions rendered by an arbitrator are in fact as finalized as would be a judgment in the court of law. The Federal Arbitration Act provides for the enforcement of arbitration decision except for in situations of corruption or behemoth inequality in the arbitrator’s decision.
The process of arbitration presents several possible benefits to companies, individuals, and other parties involved in a dispute. Foremost, the costs associated with arbitration process are significantly lower than those associated with civil litigation. Typically, cost cuts of twenty to fifty percent are experienced by parties resolving disputes through arbitration rather than civil litigation. Additionally, the time involved in the arbitration process is significantly less than that occurring in a judicial setting, which will in turn, reduce the attorney fees necessary, expert witness fees, and court costs. Also, there is a very short, if any, discovery period associated with arbitration, which greatly reduces the time period and legal footwork necessary during arbitration.
Aside from cost, the other advantages of arbitration will include the promptness in which decisions can be achieve, in comparison to courtrooms, judges, and juries. Both parties can also select an arbitrator with specific knowledge, experience, and insight into the arena of the dispute that most judges and juries will not possess prior to a potential civil trial. For this reason, decisions from an arbitrator are considered to be delivered much more competently than those of the modern legal system at times, which also improves the equality of the decision rendered.
Additionally, the process of arbitration is private and confidential. Hearings can be completely void of any press or other parties not related to the dispute, which is essential if the matter at hand is regarding malpractice, incompetence, fraud, or some other potentially embarrassing item for a company or individual. Likewise, the decisions rendered by an arbitrator can also remain sealed from the eyes of the public and media as well.
If you or your company is considering using arbitration as a means of alternative dispute resolution, contact an expert arbitration attorney in your area today.