Participants
First, the parties agree to arbitration.
They file a written agreement to arbitrate which states that they will
abide by the decision and that they give up their right to settle the
dispute in any other manner. Many arbitration agreements are standard
contract clauses. Second, the parties choose a third party neutral,
who has the authority to decide on the solution to the dispute. The
parties can agree on the process such as limiting discovery, or choose
which laws to work with.
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Process
Normally, the plaintiff presents their
case to the arbitrator. The defendant then has the opportunity to dispute
the evidence and cross examine witnesses. The plaintiffs have the same
opportunity after the defendant presents their case.
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Solution
The arbitrator usually has 30 days to review
the evidence and render a decision. The arbitrator presents the parties
with a written decision which is filed in the court. The decision of
the arbitrator is legally binding by the power of the state in which
is was file in. When an arbitrator makes a decision, they have imposed
a reality on to the parties.
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Advantages
The decision from the arbitrator is much
faster than writing to get a trial date. The cost is much less than
litigation, generally because the legal fees for discovery are much
less. Although the parties give up their right to make their own decision
about the solution, they can still choose how to operate the process.
Arbitration is good to use with international disputes, where laws are
different. E. Disadvantages The written decision may not have an explanation,
and doesn't have to follow legal precedent fully. Once a decision has
been rendered, you also give up your right to an appeal in most cases.
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Energy
1. Channel\Speed
Arbitration is much faster than litigation.
Once an agreement to arbitrate has been filed, a decision could be made
as soon as 30 days. Discovery is usually limited, which would speed
up the proceedings. Because an arbitration decision is final, the time
would also be limited since there can be no appeals.
2. Encoder\Understandability
Depending upon the formality of the Arbitration,
the language used is generally formal, but not as formal as in litigation.
Because arbitration can be designed to fit the parties needs, an arbitrator
who is an expert is a particular field, may be able to understand the
dispute more fully than a judge who is only an expert in the law.
3. Decoder\Acceptance
Compliance is medium, depending upon the
relationship of the parties. Generally people don't like other people
making decisions that concern their life, so acceptability is low.
4. Message\Importance
- Because the decision is filed in the
courts, the importance can be high if there is respect for the law.
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