A procedure where disputes may be resolved out of court using a neutral third party (arbitrator) or parties (an arbitration panel.) The process is similar to court and the arbitration uses the same rules of procedure and evidence although less formal and more quickly. The goal of arbitration is a quicker, lower cost solution to resolving disputes than using the court system. A binding arbitration is one where the arbitrator can impose a decision that may be limited by the parties, such as a minimum and maximum award. In a non-binding arbitration, the arbitrator can make recommends but the decision is not imposed upon the parties and is more suggestive of where the parties should settle. Many contracts require arbitration in the event a dispute arises and a reputed arbitration group from whom to select an arbitrator or a panel. This is problematic when large companies may have influence on the arbitrators as opposed to a judge in a court of law.
Law Dictionary – Alternative Legal Definition
In practice. The investigation and determination of a matter or matters of difference between contending parties, by one or more unofficial persons, chosen by the parties, and called “arbitrators,” or “referees.” Duren v. Getchell, 55 Me. 241; Henderson v. Beaton; 52 Tex. 43; Boy den v. Lamb, 152 Mass. 416, 25 N. E. 609; In re Curtis Castle Arbitration, 64 Conn. 501, 30 Atl. 769, 42 Am. St. Rep. 200. Compulsory arbitration is that which takes place when the consent of one of the parties is enforced by statutory provisions. Voluntary arbitration is that which takes place by mutual and free consent of the parties. In a wide sense, this term may embrace the whole method of thus settling controversies, and thus include all the various steps. But in more strict use, the decision is separately spoken of, and called an “award,” and the “arbitration” denotes only the submission and hearing. Arbitration clanse. A clause inserted in a contract providing for compulsory arbitration in case of dispute as to rights or liabilities under it; ineffectual if it purports to oust the courts of jurisdiction entirely., See Perry v. Cobb, 88 Me 435, 34 Atl. 278, 49 L. R. A. 389. Arbitration of exchange. This takes place where a merchant pays his debts in one country by a bill of exchange upon another.