Operating a business, with its multiple moving parts and partners, can come with its fair share of disputes. It is not uncommon for business partners or trading partners to end up in contract disputes or other disagreements. The critical component of any professional relationship is to resolve conflict amicably without the costly and often nasty litigation process. Arbitration is a way of keeping arguments civil and outside of the courtroom, which can save your company money in the long run and possibly salvage a relationship through mutual respect. However, before deciding on arbitration, it is essential to understand the process.
Alternative Dispute Resolution
Arbitration is a form of dispute settlement outside of the realm of litigation. The correct term for arbitrative resolutions is alternative dispute resolutions. The purpose of the process is to resolve disagreements in a cost-effective and timely manner.
For successful arbitration, you will need a neutral third-party professional to oversee the talks. The professional must be licensed to oversee arbitration, and one of the most renowned organizations is the American Arbitration Association.
The arbitrator is the final decision-maker. They listen to each side of an argument and weigh opinions against the facts to determine a fair outcome. Unfortunately, depending on the situation, the arbitrator’s decision may not be legally binding.
The Arbitration Process
More often than not, arbitration is the result of a contractual or legal obligation to attempt to resolve business conflicts outside of court. While the process is handled outside of court, it is still encouraged that each party has legal representation serving their interest.
In most cases, arbitration begins when one party feels that a business disagreement has reached an impasse and files a Demand for Arbitration. The arbitration organization will notify the opposing party of the demand, and the arbitration case will proceed.
Each party weighs in on the selection of an arbitrator who will oversee the initial hearing. During the hearing, each party can present their case and provide any witnesses or documents about the disagreement. Once each side has given their case and provided any documents requested, the arbitrator will make a final decision, which may include monetary damages or equitable relief.
If you are in the midst of a business dispute, then arbitration is one way to handle the disagreement. However, before filing a demand for arbitration, it is an excellent idea to seek legal counsel from a business lawyer in Wilkes-Barre, PA, like from Hoegen & Associates, P.C.