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Resolving Contract Disputes through Arbitration

When you sign a business contract, whether it is an employment contract or any other type of contract, there is often a clause about how you will resolve any disputes that arise between you and the other party included in the contract. In many contracts, this clause states that any disputes that arise are to be resolved through arbitration.

Arbitration is a form of alternative dispute resolution (ADR). It, along with other types of ADR, like mediation and collaborative law, exist to make it easier for parties to resolve their disputes by keeping them out of the courtroom. Going to court to resolve a dispute through litigation is often time-consuming and expensive. Litigation can also cause involved parties to suffer from negatively-impacted reputations with the public because court cases can be accessed by the public.

How Does Arbitration Work?

Arbitration works through facilitation by an arbitrator. The arbitrator can be an individual or a group of individuals who have been appointed to play this role. Decisions made by the arbitrator are legally binding and may not be appealed unless the contract specifically states otherwise. Because of this, think carefully before signing a contract that requires you to resolve issues through arbitration. Sometimes, contracts state that arbitration is the preferred option, rather than a requirement.

Generally, the arbitrator is also determined in the contract. Once it is determined that the dispute between the parties involved in the contract is to be resolved through arbitration, the date and time of the arbitration hearing is set. The hearing usually occurs in a neutral, low-key setting like the arbitrator’s office.

During the hearing, each party presents his or her side of the dispute. This may include demonstrations, testimonies about how one party did not work in accordance with the requirements in the contract, the use of pay stubs or other financial records to show that one party made incorrect or late payments, and any other piece of evidence that shows how the breach occurred. Each litigant also may testify about his or her experience with the contract in order to show why the arbitrator should rule in his or her favor. Once all evidence, testimonies, and closing remarks have been presented, the arbitrator makes their ruling. The rules of evidence only apply to the extent to the arbitrator(s) want them to apply.

An arbitrator is not a judge and as such, is not bound to the rules that govern judges. An arbitrator must simply make a ruling in accordance with what he, she, or they feel is fair given the circumstances presented. In most cases, this ruling is delivered to the parties involved in writing.

Work with a West Palm Beach Business Lawyer

Arbitration is an important tool for resolving contract disputes. When you work with others through a contract, you can expect to solve disputes that arise through this method. To learn more about arbitration or for legal representation when you need it, work with an experienced West Palm Beach business attorney. Contact the Law Offices of Larry E. Bray P.A. today to schedule your initial legal consultation with our firm.

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