Arbitration and How it Helps in Legal Cases
New York City business Lawyers deal with different iterations of civil law. Sometimes, this requires them to appear in court. Other times, New York attorneys try to avoid a trial through the act of arbitration. Here’s more information on the practice and how it helps in legal cases.
How does Arbitration work?
Arbitration is used as an out-of-court resolution between two parties. This can happen between a set of attorneys or with the presence of a plaintiff and defendant. While it has some features of a court proceeding, arbitration normally takes place in a meeting room. For instance, a conference room at the courthouse, a space in one of the firms’, or a neutral location.
The act of arbitration doesn’t take place at the offices of a law firm such as VMW LAW, unless both parties’ consent to this proceeding. However, arbitration is something that is included in many business contracts. For instance, a business acquisition attorney adds it as a clause to a relevant agreement. It must be signed by the company owner and legal representatives.
Binding and Non-Binding
There are two types of arbitration: binding and non-binding. In binding arbitration, the parties agree to the decision of the arbitrator and waive their right to a court trial. In non-binding arbitration, if a party doesn’t agree with the decision, it could opt to move the proceedings to a trial.
Selection of an Arbitrator
Normally, a sitting judge isn’t considered an arbitrator. It is usually someone who is retired from the bench. Additionally, an arbitrator could be someone certified by the American Arbitration Association (AAA). Therefore, arbitrators could be subject matter experts (SME) within their field.
Attorneys can select a single arbitrator to listen to arguments and determine a ruling. However, it’s more common to involve a panel of three arbitrators. Each party chooses someone while the third is selected by the other two arbitrators.
As an example, arbitration is requested in a dispute between a startup company and a customer. The New York small business attorney would select one arbitrator. The attorney for the customer, which could be another business, selects another arbitrator. Then, these two arbitrators review the situation and request a third arbitrator that best fits the scenario.
The way arbitrators’ rule isn’t much different than a sitting judge. They must adhere to ethics codes developed by the AAA and the American Bar Association (ABA). They must also show neutrality no matter who selects them.
How Arbitration Helps
There are several ways that arbitration benefits both parties.
Benefit No. 1: Confidentiality
Although there is a record of the proceedings, what is said during arbitration remains confident. It’s not heard by the press, a courthouse of spectators, and 12 jurors. Thus, NY business law attorneys, may feel more comfortable revealing more sensitive information. This is could increase the chances of obtaining the best outcome.
Benefit No. 2: Less Complicated
Since the arbitrators tend to be experts within their fields, arbitration is less complicated. Plus, they’re able to absorb more specific information for consideration. For instance, NY business law attorneys may be more willing to discussing issues related to the current market. It’s easier for them to do this than to bring several experts to court.
Benefit No. 3: Less Expensive
A court trial costs more for both the law firm and the client. This is due to factors like scheduling, research, jury selection, and the trial itself. On the other hand, most of the fees related to arbitration are for the conference room, court reporter, and arbitrators.
Benefit No.4: Finality
If binding arbitration is selected, then the results are final. On the other hand, the results of a trial could be appealed for years. Thus, your case remains in perpetual limbo.
In the end, arbitration may be the best way to go in civil lawsuits. If this is something you’d like to proceed with, contact VMW LAW for more information.