Explain Arbitration Agreement under Adr

Arbitration agreements are becoming increasingly popular as a means of resolving disputes between parties. This type of agreement falls under alternative dispute resolution (ADR) and is often included in contracts or employment agreements. In this article, we will explain what an arbitration agreement is and how it works.

What is an Arbitration Agreement?

An arbitration agreement is a contract between two or more parties that outlines how a dispute between them will be resolved. In this agreement, the parties agree to submit their dispute to an arbitration hearing instead of going to court. The arbitrator is a neutral third party who listens to both sides of the argument and makes a final decision. The arbitration agreement will often specify the procedure for selecting an arbitrator and the rules of the arbitration hearing.

Why have an Arbitration Agreement?

Arbitration agreements have become increasingly popular as a quicker and more affordable alternative to litigation. By agreeing to use arbitration, the parties can avoid the lengthy and costly process of going to court. Additionally, arbitration hearings are often private and not open to the public, which can help keep sensitive information confidential.

How does an Arbitration Agreement work?

Once a dispute arises between the parties, the arbitration process will begin. The parties will select an arbitrator who will conduct the hearing and impose a final and binding decision. The arbitrator`s decision is final and cannot be appealed, except in very limited circumstances.

Arbitration hearings can be conducted in person or over the phone, depending on the terms of the arbitration agreement. During the hearing, both sides will present their case and provide evidence to support their argument. The arbitrator will then weigh the evidence and make a final decision.

Enforcing an Arbitration Agreement

Enforcing an arbitration agreement may require legal assistance. The parties may need to file a motion to compel arbitration or obtain an order from a court that requires the other party to participate in the arbitration process.

In conclusion, an arbitration agreement is a contract between two or more parties that outlines how a dispute between them will be resolved. The arbitration process is often seen as a quicker and more affordable alternative to going to court. If you are considering including an arbitration agreement in your contract or employment agreement, we recommend consulting with a legal professional experienced in ADR to ensure the terms are clear, concise, and enforceable.