What is Arbitration and Its Advantages

What is Arbitration and Its Advantages

Arbitration has been a mainstay of legal dispute resolution for the past few decades. How does one determine if it’s the right solution for their complaint? What are the benefits and drawbacks of mediation, and why do most parties choose it over litigation?

There are a few things that you should know about this alternative dispute resolution system and how to identify if it’s the right solution for you. You’ll learn everything about arbitration as we discuss the ins and outs.

What is Arbitration? Why Does a Party Choose It Over Litigation?

A complaint or claim can be resolved through arbitration without having to go through the court system. Your lawyer will often recommend arbitration to resolve a specific claim. In arbitration, the complaint is presented to a neutral arbitrator who gives solutions to the lawsuit after hearing both sides.

The presentation can be made through documents which both parties submit to the arbitrator. In addition to the submission of documents, both parties will present a case in person. Traditionally, both parties are required to have their lawyers represent them. For instance, if you are dealing with divorce, a Cedar Park Divorce Lawyer can explain the process in greater detail and provide a more effective solution for your claim.

There is a primary difference between arbitration and litigation: arbitration does not involve the court system. Essentially, it’s a private dispute resolution process in which both parties agree on a resolution instead of bringing the matter to court. Alternative dispute resolution is often referred to as arbitration.

Arbitration has its advantages and disadvantages depending on the preference and determining point of the beholder. The stances of the parties are essential when it comes to the process. The pros and cons listed below can help you weigh your options to make a sound decision.


Proponents of arbitration commonly cite the advantages that arbitration often offers over litigation, court hearings, and trial as a way to resolve disputes efficiently.

  • Arbitration is more affordable compared to litigation.

Arbitration is less expensive since you will be paying the arbitrator less than the cost of bearing an expert witness on a court trial. The arbitrator’s fee is often split equally between the parties. Preparation costs are less than for a court trial.

Part of it is the simplified rules of evidence, which are more relaxed than those of a court by law. For example, if you have a witness who lives far away, bringing him or her in to testify is prohibitive. During the arbitration process, you may use the reports and documents provided by the other side.

  • Flexible

Since arbitration can be scheduled around the availability of all interested parties, it reduces the likelihood of overcrowding courtrooms, allowing you to hold the hearing during the weekdays or evenings as both parties agree upon.

  • Prevents hostility

Because both sides are encouraged to participate fully throughout the process, this will help structure the resolution in a better manner. Through both parties working together, this will decrease hostility and tension between the parties.

  • Simplified process

Arbitration proceedings are less stilted than traditional court procedures – making them easier to adapt to parties’ needs. In addition, arbitration doesn’t rely on the discovery process, which involves answering questions, taking depositions, and requesting documents — a tactic often derided as delaying and game-playing in litigation.

The majority of arbitration issues are handled by telephone call, such as whether a witness should be called and what documents must be produced.

  • Quicker decisions

The disputes are quickly resolved with arbitration and do not take a longer time compared to the court law process.

  • Confidential

Arbitration proceedings Don’t take place in open courts, and transcripts are not made publicly. This is highly valuable for most parties in several cases. Most parties agreed that the trial or hearing and terms of resolution should be private. This can protect both parties’ personal pieces of information.


Understanding the setbacks associated with this hearing can help you make a sound decision. Here’s what to expect with arbitration;

  • Both parties must waive the right to appeal a binding arbitration decision. Therefore, a party will have no opportunity to appeal a decision that they may feel is incorrect.
  • Arbitrators may consider evidence that is prohibited by the rules of evidence. However, a judge or a jury cannot assume some proof.
  • The arbitrator’s fee may make arbitration uneconomical when the dispute is complex, but the money involved is modest.
  • The testimony of a witness cannot be cross-examined if specific facts are presented by documents.
  • A contract that requires arbitration does not give the parties the flexibility to pick mediation only if both parties agree.
  • Arbitrators follow the law, but the standards they use are not clearly defined.
  • Discovery may be more limited in arbitration. Discovery in litigation is the process in which one party may be required to provide specific information or documents to the other party.

Final Words

Arbitration is a beneficial dispute resolution method, but it is essential to consider whether or not it is appropriate in a particular case. Consult your attorney about whether or not arbitration is reasonable in your case.

Written by Mia

Hey Everyone! This is Mia Shannon from Taxes. I'm 28 years old a professional blogger and writer. I've been blogging and writing for 10 years. Here I talk about various topics such as Fashion, Beauty, Health & Fitness, Lifestyle, and Home Hacks, etc. Read my latest stories.

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