Arbitration

TABLE OF CONTENTS/QUESTIONS

  1. WHAT IS ARBITRATION?
  2. HOW IS ARBITRATION DIFFERENT FROM MEDIATION?
  3. WHAT ARE SOME DISADVANTAGES OF ARBITRATION?
  4. IS ARBITRATION AGREED OR ORDERED?
  5. IS ARBITRATION CONFIDENTIAL?
  6. DO I HAVE TO HAVE AN ATTORNEY REPRESENT ME AT ARBITRATION?
  7. CAN WE ARBITRATE WITHOUT AN ARBITRATOR?
  8. WHO PAYS FOR ARBITRATION?
  9. IS ARBITRATION "BINDING"?
  10. OKAY, WHAT REALLY HAPPENS AT ARBITRATION?
  11. WHO CAN BE AN ARBITRATOR?
  12. CAN YOU ACT AS OUR ARBITRATOR?
  1. WHAT IS ARBITRATION?

    Arbitration, a form of alternative dispute resolution (ADR), is a way to resolve disputes outside the courts. The dispute will be decided by one or more persons (the "arbitrators", "arbiters" or "arbitral tribunal"), which renders the "arbitration award". An arbitration award is legally binding on both sides and enforceable in the courts. Arbitration is often used for the resolution of commercial disputes, and is also frequently employed in consumer and employment matters. Arbitration may be mandated by the terms of employment or commercial contracts and may include a waiver of the right to bring a class action claim. Mandatory consumer and employment arbitration should be distinguished from consensual arbitration, particularly commercial arbitration.

  2. HOW IS ARBITRATION DIFFERENT FROM MEDIATION?

    Mediation is when a third party assists the parties in hopefully coming to a settlement. Arbitration is when, instead of using the judge and jury in the courts, the parties use an arbitrator who essentially takes on the roles of a typical judge and jury and listens to the evidence and arguments and makes a decision regarding who prevails and what damages, if any, are awarded.

  3. WHAT ARE SOME ADVANTAGES OF ARBITRATION?
    1. Parties often seek to resolve disputes through arbitration because of a number of perceived potential advantages over judicial proceedings.
    2. In contrast to litigation, where one cannot "choose the judge", arbitration usually allows the parties the option to choose their arbitrator. This is especially useful when the subject matter of the dispute is highly technical because arbitrators, with an appropriate degree of expertise, can be chosen (for example, quantity surveying expertise in the case of a construction dispute, or expertise in commercial property law in the case of a real estate dispute).
    3. Arbitration is often faster than litigation in court.
    4. Arbitral proceedings and arbitral awards are generally non-public, and can be made confidential.
    5. In most legal systems there are very limited avenues for appeal of an arbitral award, which is sometimes an advantage because it limits the duration of the dispute and any associated liability.
    6. Arbitration awards can be enforced in the same manner as court judgments and have the same effect.
  4. WHAT ARE SOME DISADVANTAGES OF ARBITRATION?
    1. Arbitration must be paid for by the parties including at the beginning and during the process. In the court system, the government pays for the judge; in arbitration, the parties pay for the arbitrator.
    2. Arbitration agreements are sometimes contained in the "fine print" or in ancillary agreements, and consumers and employees often do not realize that they have agreed to mandatory binding pre-dispute arbitration by purchasing a product or taking a job.
    3. If the arbitration is mandatory and binding, the parties waive their rights to access the courts, including the right to have a judge or jury decide the case.
    4. If the arbitrator depends on the corporation for repeat business, there may be an inherent incentive to rule against the consumer or employee.
    5. There are very limited avenues for appeal, which means that an erroneous decision cannot be easily overturned.
    6. Discovery may be more limited in arbitration or entirely nonexistent.
    7. Unlike court judgments, arbitration awards themselves are not directly enforceable. A party seeking to enforce an arbitration award must resort to judicial remedies, sometimes called an action to "confirm" an award.
  5. IS ARBITRATION AGREED OR ORDERED?

    In Texas, the Court never orders arbitration unless it is an order to confirm a previous agreement to arbitrate which one party is attempting to dishonor. Arbitration is either agreed pursuant to a contract, or agreed upon by parties who prefer to settle their dispute through arbitration rather than formal litigation.

  6. IS ARBITRATION CONFIDENTIAL?

    No, unless such is agreed to by the parties. However, the arbitration is not public record such as a typical court filing. Thus, the ability for a member of the public to find out about arbitrations is much more limited (if not impossible) than the ability to find out about lawsuits that are in the public domain.

  7. DO I HAVE TO HAVE AN ATTORNEY REPRESENT ME AT ARBITRATION?

    No, but representing oneself in arbitration would be akin to representing oneself at trial, which is known as " pro se" representation. Pro se representation is not advisable, especially in complicated matters that involve significant amounts of money.

  8. CAN WE ARBITRATE WITHOUT AN ARBITRATOR?

    No. An arbitration without an arbitrator is like a trial without a judge or jury.

  9. WHO PAYS FOR ARBITRATION?

    Unlike the court system, which pays for the judge and jury with public funds, arbitration is paid for by the parties (typically starting at the very beginning). The fees will depend on the arbitrator, and the fee arrangements are typically flat fee, hourly fee, or blended fee. Hiring an arbitrator can be similar to hiring an attorney, in terms of fees.

  10. IS ARBITRATION "BINDING"?

    Typically "yes," though the parties can agree that it not be binding.

  11. OKAY, WHAT REALLY HAPPENS AT ARBITRATION?

    The arbitration process can be adjusted by the arbitrator and parties to fit the needs of the specific case. In general, an arbitrator performs the same roles as a judge and jury, but is usually more accessible and responsive than the typical court system.

  12. WHO CAN BE AN ARBITRATOR?

    The parties can choose anyone they want to be an arbitrator. Typically, it is preferred to choose someone with experience in arbitration or civil litigation and who has experience with the type of claim to be resolved.

  13. CAN YOU ACT AS OUR ARBITRATOR?

    I can for the right case. If you want to use me, just call.

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