Myths About Arbitrating Business Disputes
Litigation is not the only option for resolving business disputes. There are alternatives to litigation, and often, these alternatives are less time-consuming and less expensive than litigation. One of the most common alternative dispute resolution (ADR) methods is arbitration. Arbitration involves the disputing parties agreeing to have their case heard by a qualified arbitrator or a panel of arbitrators. It is up to the arbitrator or panel of arbitrators to make the final decision. While the use of arbitration has risen over time, there are some persistent misconceptions about the process. In this article, we debunk some of the most prevalent myths about arbitrating business disputes.Myth #1: Arbitration Offers No Advantage Over Litigation
There are several benefits of arbitration. First, arbitration is usually faster and less expensive than litigation. Second, disputing parties have the ability to choose the arbitrator(s). The ability to select the arbitrator(s) is particularly crucial where the issue at hand involves matters of an industry-specific or technical nature. Arbitration also offers confidentiality, something that litigation does not offer.Myth #2: Arbitration is Always Cheaper Than Litigation
The truth is arbitration can be more expensive than litigation. First, well-known and experienced arbitrators may be costly. Second, if you hire an attorney, you will need to pay them. However, it is always advisable to hire an attorney. Additionally, the costs of arbitration may go up if you do a complete and thorough discovery. However, in most cases, arbitration is less expensive than litigation.Myth #3: Arbitration is Always Faster Than Litigation
Whether arbitration turns out to be faster than litigation largely depends on several factors. Some of the factors that can influence how long it takes for a business dispute to be resolved through arbitration include the behavior of the parties, the rules of the arbitration service, including the procedural rules, and the complexity of the case. However, often, arbitration is faster than litigation.Myth #4: Arbitrators Do Not Follow the Law
This myth stems from the fact that arbitration is a less formal method of resolving disputes than litigation. But the truth is that arbitrators are required to follow the law, and they do follow the law. However, with the arbitration process, disputing parties can choose which rules and procedures to follow. In such cases, arbitrators will follow the chosen rules and procedures. But even when disputing parties select the rules and procedures, arbitrators must still ensure the principles of equity are upheld.Myth #5: An Arbitration Award Cannot Be Enforced Easily
After an arbitrator or arbitration panel issues an award, a party can seek to enforce the award through the courts. Often, the court will enforce an arbitration award. Only under a few circumstances, such as if a public policy was violated or fraud was involved, will the court refuse to enforce an arbitration award.
It is crucial to note that enforcement procedures may vary depending on the jurisdiction. A qualified business attorney can guide you on how to enforce an arbitration award in your jurisdiction.Contact a Qualified San Jose Business Attorney
For more information or legal help, contact our experienced Silicon Valley business attorneys at SAC Attorneys LLP today.