Advantages of Signing An Arbitration Agreement
Arbitration has been a cornerstone in settling legal disputes during the last few decades. But is arbitration the best option for you? To find out, study the fundamentals of arbitration, including the benefits and drawbacks of this dispute-resolution approach, so you can decide whether to select arbitration or sign a contract with a forced arbitration provision. Some other things you can do are get the help of an experienced lawyer and check this out.
Advantages of arbitration
Arbitration proponents characterize it as a practical means to resolve conflicts and point to various advantages over litigation, court hearings, and trials.
- Minimizes hostility
Because parties in arbitration are frequently invited to engage completely and, in some cases, to assist in building the settlement, they are more likely to work together peacefully rather than grow their anguish and anger toward one another, as is often the litigation case.
- Often cheaper than litigation
Arbitration is growing more expensive as more established and experienced lawyers join the cause. It is not uncommon for well-known arbitrators, for example, to charge $3,000 to $4,000 a day for their services. In addition, most arbitration parties will retain attorneys to assist them through the procedure, increasing their costs. Nonetheless, because the procedure is faster and less involved than a court hearing, settling an issue through arbitration is usually significantly less expensive than continuing through litigation.
- Faster than litigation
According to a study conducted by the Federal Mediation and Conciliation Services, the average time from filing to decision in an arbitrated matter was around 475 days, whereas a similar case took anywhere from 18 months to three years to work its way through the courts.
- More flexible
Unlike trials, which must be organized around the requirements and availability of individuals involved, arbitration hearings may typically be set around the needs and availability of those involved, including weekends and nights.
- Rules of evidence and procedure are simplified.
Arbitration processes are less formal and more easily customized to the interests of the persons concerned since the frequently complicated rules of evidence and procedure do not apply. Importantly, arbitration avoids the discovery phase, which involves the taking and responding of interrogatories, depositions, and demands to produce documents and is frequently condemned as a delaying and game-playing approach in litigation. Most issues in arbitration, such as who will be summoned as a witness and what documents must be submitted, are resolved with a simple phone conversation.
- More privacy
Arbitration hearings are often held in secret. Parties may also agree to keep the procedures and the details of the conclusion private. Both of these measures can be beneficial if the subject of the disagreement could create humiliation or divulge private information, such as a company’s client list.
