Arbitration for Alternative Dispute Resolution
Arbitration agreements have made their way into our everyday life. Going to a new doctor requires signing an arbitration agreement form. Starting a new job requires signing an arbitration agreement. They are present in credit card agreements, cell phone purchases and service, nursing home documents, tickets to vacation, real estate leases and most every commercial contract or business transaction. Refusing to sign an arbitration agreement can cost you a job offer, medical care by the doctor of your choice or any other service or purchase.
Arbitration is a legal course of action that is initiated to resolve civil disputes without the formality of court. It is an alternative dispute strategy designed to deal with our litigious country. In the case of medical disputes, physicians are utilizing arbitration in an effort to reduce their liability, which could impact on their medical malpractice insurance and the professional reviews of their practice. For all commercial businesses, avoiding the formalized court system by engaging in the arbitration process is more cost effective and less time consuming. The hearings can generally be scheduled around the party’s availability and are held in private. Another important aspect is that court records are for public viewing, which can be damaging to a corporation’s reputation. Arbitration records are kept private.
The process of arbitration requires that a neutral third party be retained to listen to both sides of a dispute and make a decision. Based on the agreement of the parties in dispute, the arbitration decision can be binding or non-binding. A binding agreement means that the decision is final. A binding agreement can only be contested in court under the premise that the decision was based on fraud, bias or misconduct of the arbitrator. A non-binding agreement indicates that the award is advisory and must be accepted by both parties. The arbitrator is often chosen for their expertise and competence on the subject that is being disputed. The cost of this service is usually split between both parties, unless a different agreement was reached prior to the proceedings.
There are distinct disadvantages to the usage of arbitration as well as advantages. If one of the parties in dispute feels the decision of a binding agreement is illogical or unfair, there is little recourse. Private hearings tend to be more biased, as there is no legal oversight and the disputes are not available for public review. The choice of an arbitrator by a corporation might well mean that the arbitrator is more likely to favor that corporation. A jury trial can be viewed as having more objectivity, as the judge instructs the jury on the law that must be used to decide a case. It can also be said that arbitrators tend to be more fact based and logical, whereas jurors in a trial tend to look at the fairness of a case. Arbitration is a stream lined process, involving less discovery in the case. While this saves time and reduces costs, it may result in leaving out important evidence for the arbitrator to review. There is also the feeling that arbitration is coercive, that is, the person signing an arbitration agreement really does not understand the legal implications of it until they are in a dispute.
While arbitration, as an alternative dispute resolution, can be a viable solution in resolving disputes, it is important to obtain legal counsel for representation in any dispute. The Boutty Law Firm has extensive experience in resolution strategies in contracts and business transactions. Our team can weigh the pros and cons of arbitration versus a court trial for your dispute. We will defend your rights and advocate for the best possible outcome. Contact us at (407) 537-0543.