What Is Arbitration and How Much Will It Cost Me?

What Is Arbitration and How Much Will It Cost Me?

Although the legal term arbitration sounds like a phrase only found in union disputes in years gone past, it has become a more common procedure than many realize. Nowadays, the practice of arbitration has gained traction, and you will find it in credit card agreements, retail contracts, and employment contracts, among many other situations. You should know what it means.

According to statistics released by the Global Arbitration News company, there were approximately 7,222 arbitration cases globally in 2019. This figure has climbed in recent years, as in 2012, there were only 4,521 global arbitration cases. 

Most often, you will have no choice whether to agree to arbitration. Want to sign up for cable tv or a cell phone? Mandatory binding arbitration clause. Want to invest with a stockbroker? Again mandatory binding arbitration clause. Want to work for any large employer? You guessed it – you will have to agree to mandatory binding arbitration.

What Exactly Is Arbitration?

Unlike litigation, arbitration is a private process that allows disputing parties to agree that one or several individuals can come to a decision surrounding a dispute. This means no jury of your peers, no rules of evidence, probably no standard rules of procedure, and limited ability to appeal the arbitrator’s/arbitrators decision. The arbitrator(s) is the judge and the jury.

So who is an arbitrator? Usually, they are experienced or retired attorneys or, sometimes, retired judges. In many arbitration forums (private arbitration companies that will host an arbitration), you will get to pick your own arbitrator from a list of options. The other side will also get to pick an arbitrator of its choosing. Then, the two arbitrators will agree on a third arbitrator. If you go in front of a panel of three arbitrators, whoever gets two of the three votes will win.

You may have also heard of the term mediation. Arbitration is different from mediation in a few unique ways.

  • Mediation is a voluntary
  • It’s a structured settlement negotiation
  • A neutral party attempts to get the parties to agree to a solution.

In arbitration, however, if an agreement cannot be reached, the arbitrators will make a binding decision to resolve the matter.

The arbitration process does have similarities to a courtroom trial. Both parties involved in the dispute will make their opening statements and present the relevant evidence associated with the case to the arbitrators.

However, unlike the trial process, an arbitration case is usually resolved faster and is far less formal.

What we mean by this is that the parties involved don’t need to follow the various state and federal rules regarding evidence and have broader authority to consider whatever they find important. However, it may be helpful to seek legal advice from a local attorney with a solid community reputation.

Once an arbitration hearing has been completed, an arbitrator will then issue a decision. For example, the decision may include requiring one side to pay money or finding that neither side owes money.

Binding vs. Non-Binding Arbitration

arbitration cases can be a non-binding or binding process

Additionally, arbitration cases can be a non-binding or binding process. If your arbitration was binding, it means the decision is final and can be upheld by a court.

The outcome can also only be appealed under rare circumstances. However, suppose your arbitration case is non-binding. In that case, it means that the arbitrator’s decision is only an advisement that only becomes a final judgment if all parties agree to the decision.

The arbitration process is a bit more complicated than we have explained above. That’s why it would be best to consider hiring an attorney if you find yourself in arbitration of an important matter.

How Much Does Arbitration Cost?

In most instances, the arbitration process is less expensive than taking your case to court – one reason why it is favored by many large businesses. 

However, arbitrators charge a daily rate for their services which is different from most lawyers that charge a contingency fee. If the arbitration process is drawn out, it can cost you more than if you chose to initiate a lawsuit with an attorney.

In some cases, the party requiring you to arbitrate will pay for the entire arbitration process (other than your attorney fees). In other cases, an arbitration proceeding will stipulate that the losing party will be responsible for all the costs.

If you find yourself in an arbitration, it is critical that you identify the rules that the arbitration is subject to and familiarize yourself.

Why You Should Consider Hiring an Ohio Lawyer for the Arbitration Process

It is not a requirement that you hire a lawyer for your arbitration case, but it is recommended. If you hire a qualified lawyer to assist you with your arbitration claim, they will protect your rights and guide you through the arbitration process.

Below we have provided a few reasons why you should consider hiring an attorney to handle your arbitration proceedings.

Your attorney will:

  • Help you select an arbitration panel or arbitrator for your case;
  • Conduct and manage all legal research required;
  • Interview and prepare witnesses for your case;
  • Investigate all relevant evidence and gather important documents;
  • Present the arguments to the arbitrator on your behalf surrounding the discovery and admissibility of evidence;
  • Negotiate the ground rules with you and the other party involved in your dispute;
  • Question witnesses at your arbitration hearing and cross-examine them.

Get in Contact With an Ohio Lawyer to Discuss the Arbitration Process and Your Case Today

arbitration claims

Do you need help with your arbitration case? You may avoid an arbitration that would otherwise decrease your chances of success. If so, consider consulting an Ohio lawyer with relevant experience in this area of law. 

At The Henry Law Firm, we have been representing clients in Ohio for many years and have helped many with – and avoiding – their arbitration claims. Get in contact with our firm to set up an obligation-free consultation.

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