Many legal disputes can be resolved through an Alternative Dispute Resolution (ADR) process rather than a traditional trial setting. Where the parties have attempted to resolve their issues independently but have been unsuccessful, they might seek the participation of a mediator. If mediation is an insufficient means for the parties to adequately address the conflict, then arbitration may be an excellent option. Arbitration is another form of ADR. During this process, a neutral arbitrator, or panel of arbitrators, reviews and examines the evidence in the case and issues a decision.
Voluntary and Mandatory Arbitration. Arbitration is typically triggered by a mandatory provision in a contract providing that any disputes arising from the parties’ agreement or transactions will be resolved through an arbitration proceeding. Various types of contracts incorporate an arbitration clause, such as employee, business, and consumer contracts. These clauses can be simple and straightforward or more complex, including provisions governing who will choose the arbitrator, how the arbitrator will be selected, where proceedings will take place and who is responsible for attorney’s fees. Some arbitration agreements require that disputes be arbitrated through an arbitration group or an organization selected in the arbitration agreement. In other cases, the parties can agree upon a particular arbitrator they want to use. Although parties typically agree to arbitrate a dispute by contract before a dispute arises, parties may also decide to submit to arbitration after a dispute arises. If a party refuses to comply with the agreement to arbitrate, or challenges the validity of the agreement, then the matter may be decided by way of a petition or motion to the court with jurisdiction, and the court determines whether to compel arbitration pursuant to the parties’ agreement.
In some cases specified by statute, a court may provide that it is in the best interests of justice to order that a dispute must be resolved through arbitration even though the parties have not agreed to arbitrate. If, for example, the amount in dispute pending in California state court exceeds $50,000, the dispute will be exempt from such mandatory arbitration and may proceed in court.
Binding and Non-Binding Arbitration. An arbitration decision can be either binding or non-binding. If it is binding, the decision may be enforceable as a judgment of the court.
In a binding arbitration, the decision made by the arbitrator is final. It cannot be appealed or revisited except in unusual circumstances, including fraud or misuse of power. In a non-binding arbitration, either party can reject the decision and request a subsequent trial. The decision to enter into a binding or non-binding arbitration is usually made in the early stages of the proceeding, and is often dictated by the parties pre-dispute agreement.
If you are party to a contract that requires arbitration and are facing an arbitration proceeding, obtaining professional and experienced legal advice will ensure that your rights and interests are protected. To find out how Mr. Coons can arbitrate your case, contact him at 949-333-0900 or visit his website at www.ShaneCoonsLaw.com for more information.