How is arbitration different from litigation?

14 Jun, 2021

On Behalf of Mack & Mack Attorneys | business law

If you are embroiled in a business dispute, you have multiple options as to how to resolve it. It is generally better to avoid the courtroom if at all possible, given how expensive and time-consuming litigation is.

One popular alternative dispute resolution method is arbitration. According to FindLaw, arbitration involves hiring an arbitrator or a panel of arbitrators to act as a judge to issue a “ruling” on your dispute.

What does arbitration look like?

Arbitration can actually take multiple forms. One of the advantages of arbitration is that it is more malleable than litigation because it does not involve strict legal processes. Usually, both parties agree on an arbitrator or a panel of arbitrators. Then, both sides will present their side of the case. After, the arbitrator will issue a ruling on the case.

One of the advantages of arbitration is that you can choose who the arbitrator is. Depending on your dispute, it might be useful to have somebody who is a subject matter expert. A judge is an expert of law, but not necessarily on your business vertical. Keep in mind that arbitration is generally a binding process, which means that if you choose arbitration you typically give up the right to litigate if you are not happy with the decision the arbitrators make.

When can I arbitrate a dispute?

You can arbitrate any potential dispute, provided it is not criminal in nature. However, just because one party wishes to arbitrate rather than litigate, this does not remove the right of the other party to take the matter to court. Both parties need to agree upon litigation in order for it to be a valid dispute resolution option.

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