What is the difference between arbitration and court

If there is no pre-dispute agreement to arbitrate, the parties will have the freedom to choose how to resolve the dispute.

While arbitration and court litigation are often placed at odds, there are a few similarities between the two systems that may make choosing one or the other a difficult one. Yet the differences between the two systems allow savvy litigants to choose the best venue for their dispute.

The similarities and differences provide a window into the factors that will need to be considered as the parties decide whether arbitration or litigation will be the best option for their dispute. Reading through the differences listed above, a few advantages and disadvantages may be fairly evident. Factors like cost, speed, and privacy lean strongly toward arbitration. As evidenced above, there are some great advantages to choosing to use arbitration, but there are also some disadvantages.

The same is true for traditional litigation. Litigation is often more expensive and time-consuming, but it often allows the parties to fully flesh out their issue and allow a third party to decide. Choosing to use arbitration or allowing a dispute to be resolved through litigation is not an easy decision. Two of the most popular options are to settle the dispute in a courtroom or to take the matter into arbitration. The arbitration and mediation lawyers at Hendershot Cowart P.

Essentially, litigation means taking a dispute to court. Both sides present their case before a judge or jury, who will then render a decision. Arbitration, on the other hand, is a private process in which both parties agree that an arbitrator a neutral third party will render a binding decision.

Like litigation, both sides have a lawyer in arbitration, and both make arguments and present evidence to support their case. There are several differences between arbitration and litigation. The most significant difference is that litigation is handled in the court and must adhere to the strict laws and statutes that govern court proceedings.

Arbitration is handled outside of the courts and can be a much speedier and informal process. However, arbitration can only take place if it is provided for in a contract or agreed upon by the parties. Like arbitration, mediation is an alternative to litigation. However, mediation is merely a negotiation, and there is no guarantee that the parties will come to a resolution.

In fact, many judges — especially in larger metropolitan areas — will not let a case go to trial without mediation and automatically include a mediation deadline in the docket control order or scheduling order which is issued shortly after a lawsuit is filed. Create a personalised ads profile. Select personalised ads. Apply market research to generate audience insights. Measure content performance. Develop and improve products. List of Partners vendors. Table of Contents Expand.

Table of Contents. Arbitration vs. Mandatory Arbitration. Which Is Best for Your Business? By Jean Murray. Learn about our editorial policies. Key Takeaways Arbitration and litigation are different ways to settle business disputes.

Arbitration processes are overseen by an arbitrator, while litigation is under control of a judge. The decision of a judge can be appealed, while the decision of an arbitrator is usually binding on both parties and has limited appeal rights. Mandatory arbitration clauses are common in many business contracts. Time is Money in Resolving Disputes A report by the American Arbitration Association showed that resolution times in health care cases were resolved in a shorter time with arbitration than with U.

What is binding arbitration? Some arbitration may be non-binding, depending on contract language or the situation. What's the difference between mediation and arbitration? How long does arbitration take? Article Sources. Your Privacy Rights. Through provisions set forth in a construction agreement or upon mutual agreement of the parties once arbitration has commenced, the parties have the opportunity to establish rules and limits for pre-hearing exchange of documents or interrogation of witnesses, the manner in which an arbitration hearing will be conducted and the level of detail to be included in an arbitration award.

Arbitration often is less costly than court litigation, primarily due to the compressed schedule for the completion of discovery and trial. In court litigation, significant expenses are devoted to pre-trial discovery processes, such as written interrogatories and depositions of witnesses. However, the discovery process that is prevalent in litigation increasingly has become a regular part of arbitration as well, thus increasing costs.

The soundness of any adjudication is largely dependent upon the quality of the arbitrator or trial judge. In the arbitration process, the parties select the arbitrator s. Any pre-hearing disputes between the parties are decided by the same arbitrator s that ultimately decide the case. In contrast, in many courts, no individual judge is assigned to a case and, therefore, multiple judges may be involved in adjudicating pre-trial disputes.

The judge is assigned by the court without input from the parties. Thus, arbitration affords the parties the ability to select the decider, whereas court litigation does not.