Understanding Arbitration In California

Arbitration is a form of alternative dispute resolution (ADR) where parties submit a dispute to a neutral third party, an arbitrator. The arbitrator makes a decision, which is often binding. Unlike litigation, it is characterized by:

• Less formality
• Confidentiality
• Speed

The process can be conducted online, in private, and without the need to follow the rules of evidence in a court of law.

When Does Arbitration Apply?

This form of dispute resolution applies when:

• There is an arbitration agreement between the parties
• The contract contains a binding arbitration clause
• The parties voluntarily choose arbitration in the course of a dispute

However, arbitration is most commonly used in:

• Commercial contracts
• Labor relations
• International transactions
• Consumer and service provider disputes

For example, when an employee signs an employment contract stating that any disputes will be resolved by arbitration, the employee loses the right to go to court. As the National Employment Law Project points out, more than 60 million employees in the U.S. are bound by binding arbitration agreements. This means that a significant portion of employment disputes do not proceed to court, but are handled through closed arbitration proceedings.

How Does Arbitration Work?

The arbitration process can vary depending on the specific agreement and the organization that administers the process. However, common steps include:

1. Initiation – one party files a request for arbitration.

2. Selection of an arbitrator – the parties jointly select one or more arbitrators.

3. Preparation – the parties submit documents, evidence and testimony.

4. Hearing – the arbitrator hears the parties’ arguments and may ask questions.

5. Decision – the arbitrator makes a final decision that is enforceable.

Arbitrators’ decisions are recognized and enforced by the courts, making arbitration a powerful tool. However, it should be kept in mind that the possibilities of appeal are limited.

Advantages and Disadvantages of Arbitration

This process has several important advantages:

1. Speed. A decision can be made within a few months

2. Confidentiality. The court holds hearings in private

3. Conservation of resources. With the right strategy, costs can be lower than in court

4. Specialization of arbitrators. In complex cases, the parties can select an arbitrator with relevant expertise

5. Minimization of hostility. It is more informal, which reduces the intensity of the conflict

Despite its advantages, arbitration has its disadvantages:

1. Limited appeal. Even if there is an error by the arbitrator, there can be no review unless there are special grounds

2. High costs. The services of professional arbitrators are often expensive

3. Potential bias. In consumer and employment contexts, arbitrators may be loyal to the companies that are often their clients

That’s why it’s important to have competent representation. A professional lawyer can help clients not only prepare effectively, but also defend against procedural irregularities.

Who Does Arbitration?

Lawyers who specialize in dispute resolution and contract law conduct proceedings to resolve disputes outside of court. Their work includes:

• Analyzing contracts for dispute resolution provisions
• Advising clients on dispute resolution strategies
• Preparing pleadings and exhibits
• Attending hearings
• Defending the client before the arbitrator
• Enforcement of the arbitral award in court

Our attorneys have experience and a deep understanding of both the federal and California legal nuances of the process. We represent both corporate clients and individuals in dispute resolution matters. According to the American Arbitration Association (AAA) a professional lawyer must not only have a solid understanding of the law, but also be able to:

• Strategically assess risk
• Manage the evidentiary record
• Communicate effectively with the arbitrators

In addition, JAMS provides a detailed definition of arbitration and an explanation of the standards followed by arbitrators in the United States.

Why It is Important to Seek Legal Counsel?

Although arbitration may seem more informal than litigation, it is not necessarily easier, as several common factors can still impact outcomes. Mistakes in the documents, missed deadlines for evidence, and weak legal arguments can each result in a significant loss for the claimant. That is why assistance from a qualified attorney, such as those at KAASS LAW, is essential for building a strong legal defense.

Conclusion

Arbitration is a powerful tool for those who want to avoid protracted litigation and reach a resolution quickly and confidentially. However, it requires:

• A thorough understanding of the process
• The ability to work with dispute resolution institutions
• The right choice of strategy.

This is why the assistance of qualified counsel is critical. Our firm provides comprehensive services, including:

• Contract analysis
• Strategic support
• Trial advocacy

If you have a dispute that is subject to alternative dispute resolution or would like to include an arbitration clause in a contract, contact us. Call us at 844-522-7752 for a free consultation.