Arbitration law is a process that involves the assistance of one or more neutral parties known as arbitrators. Arbitrators are charged with hearing evidence from numerous involved parties in a dispute, and their main duty is to issue an award deciding who gets what in order to resolve the situation. In some instances of arbitration law, an arbitrator may also issue an opinion in conjunction with the award, which is designed to explain the award and the reasoning that led to it. Arbitration law and mediation law are two different processes and should not be confused. The award and the opinion are not capable of being reviewed by a court, and there is no availability for appeal. The purpose of arbitration law is to serve as a substitution to a trial and a review of the decision by a trial court.
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Arbitration Law Defined
Arbitration, simply put, is a form of legal alternative dispute resolution that is used to dispute conflicts outside of the normal court system. Arbitration law involves allowing parties to dispute each side of the situation, and a neutral party known as an arbitrator is charged with making a decision about the dispute based on the facts rather than any personal bias. Arbitration law is a settlement technique that requires the use of a trained and certified third party that is responsible for imposing a final decision that cannot be appealed and that is completely legally binding for both sides of the dispute to follow. There are other types of alternative dispute resolution in addition to arbitration, including litigation, negotiation and mediation for example. There are traditional arbitration cases and also arbitration cases that fall into certain industries or categories, such as divorce arbitration and construction industry arbitration for example.
When is arbitration law the appropriate option?
In most situations, arbitration law is quicker, more cost effective and much more informal than other types of litigation. Unlike when it comes to litigation, there is a lot more control for parties in arbitration law who want to choose their judge or arbitrator, and they also have far greater control when it comes to determining not only when and where the matter will actually be decided, but also how it’s decided in some cases. Once the dates for the arbitration have been set, there does not need to be nearly as much worry regarding being taken off of the calendar or bumped because of another case.
The parties involved in arbitration are able to agree to which specific rules will preside over the case, as well as what types of evidence will be capable of being accepted during the arbitration process. For example, the parties involved in an arbitration case may agree in the provisions for their arbitration that evidence that may not normally be admissible in court be allowed into evidence without causing either party to incur any kind of extraordinary expenses in the process. The parties can also choose to agree on how the arbitrator actually goes about determining expenses, damages, attorney’s fees and costs for the arbitration law process as well. It is important to know that the arbitration law process is completely final. What this means is that once a decision has been made by the arbitrator or arbitrators, there is no appeal system to speak of. The award and opinion offered by an arbitrator following an arbitration process can only be vacated or set aside for very specific reasons that are not common.
When is Arbitration Law used?
Arbitration law is most commonly used for the purpose of resolving marital and commercial disputes. Arbitration law is especially popular when it comes to international transactions of a commercial basis, and resolving them fairly through the use of an unbiased third party, or an arbitrator. The use of arbitration law is a lot more controversial in nature when it comes to employment matters and consumer matters, because arbitration law is not typically voluntary in these situations, but rather is imposed upon either employees or consumers based on contracts forged in fine print, which denies individuals the right to make use of the trial court as they should be able to. Arbitration law is capable of being voluntary or mandatory in nature, and is capable of being either non-binding or binding in nature. Non-binding Arbitration law is similar to mediation when you look at it on the surface, but there is a principal distinction: Where a mediator would try to help find a middle ground where a compromise could be found, the purpose of an arbitrator is to remain completely removed from the process of the settlement, only giving a determination regarding liability and damages.
Advantages and Disadvantages of Arbitration Law
Arbitration law is often the solution for parties looking to resolve their dispute situations because arbitrators can be chosen that possess a specific level of expertise on a subject, and because arbitration law is often faster, more cost effective and more private than other alternative dispute resolution options. Arbitration is most often a lot quicker than litigation, and it involves an out of court settlement, which means more privacy for the involved parties. Arbitration rewards also tend to be much easier to enforce in most cases, thanks to the provisions set in the New York Convention of 1958.
There are also some disadvantages associated with Arbitration law, including the fact that arbitration agreements can sometimes be contained within ancillary agreements or buried within small print. When arbitration law happens to be binding and mandatory, parties have to waive their natural right to gain access to the court. Additionally, the parties in some arbitration agreements may be required to pay for the time the arbitrator spends working on the case, which can add additional, prohibitive legal costs, especially when it comes to smaller consumer disputes. Finally, discovery in the Arbitration law process may be more limited than in mediation or litigation.