By Bob Bailey, Director of the Center for the Study of Dispute Resolution and Assistant Dean
Once upon a time, litigation reigned as the legal mechanism for resolving disputes. Today, client counseling, negotiation, mediation, and arbitration processes resolve the vast majority of legal disputes. These dispute resolution processes formerly were called alternative dispute resolution (ADR), but now they, along with litigation, comprise the dispute resolution (DR) continuum.
Arbitration is the DR process that most resembles litigation. A key difference between litigation arbitration is that litigation is a public process while arbitration is a private process. As arbitration is a private process, for many disputants this aspect is an additional inducement for its use. Arbitration historically has been a more informal, efficient, and less costly dispute resolution process when compared with litigation. Further, arbitration typically involves much less discovery, thereby reducing the time and cost associated with bringing closure to a dispute. Finally, the parties select the arbitrator who often brings much expertise and knowledge to the legal area in dispute.
Today, arbitration is used to resolve commercial, employment, construction, labor, and insurance disputes to name a few of the areas where the parties choose arbitration. A hallmark of arbitration is that it is final and binding upon the parties. This attribute, as well as the very limited appeal available to the parties, makes arbitration a quicker and more final dispute resolution process for most disputes.
Finally, many of you may be aware of arbitration because of its presence in the news surrounding sports. Arbitration has been incorporated in most major league sports agreements because it is private and final and tends to leave the parties more satisfied with the outcome, especially as the parties select the arbitrator. This arbitrator selection process typically means the parties can select an arbitrator who is knowledgeable and familiar with their sport.