Arbitrator

Definition

An arbitrator is an impartial third party who is appointed to resolve a dispute between two or more parties through a process known as arbitration. Unlike mediation, where the mediator facilitates negotiation, an arbitrator has the authority to make a binding decision based on the evidence and arguments presented. This role is crucial in various dispute resolution processes, providing a structured and formal avenue for conflict resolution outside of traditional court settings.

5 Must Know Facts For Your Next Test

1. Arbitrators are typically selected based on their expertise in the relevant field or industry related to the dispute.
2. The arbitration process is generally less formal than court proceedings, but the decisions made by arbitrators are legally binding and enforceable in most jurisdictions.
3. Parties often choose arbitration because it can be faster and less expensive than traditional litigation, providing a more efficient resolution to disputes.
4. Arbitration can be voluntary, where parties agree to it, or mandatory, often stipulated by contractual agreements.
5. Arbitrators can issue awards that include monetary compensation or specific performance requirements, depending on the nature of the dispute.

Review Questions

• How does the role of an arbitrator differ from that of a mediator in dispute resolution processes?
  • An arbitrator's role is distinct from that of a mediator in that an arbitrator makes a binding decision after evaluating evidence and arguments presented by both parties, while a mediator facilitates discussions without imposing any decisions. Mediation focuses on helping parties find common ground and reach their own agreement, whereas arbitration provides a more formal structure where the arbitrator serves as the decision-maker. This difference highlights the varying levels of authority and involvement that each role has in resolving disputes.
• Discuss how the choice of arbitration impacts the overall effectiveness of dispute resolution between parties.
  • Choosing arbitration can significantly impact the effectiveness of dispute resolution due to its binding nature and streamlined process. Arbitration often leads to quicker resolutions compared to court proceedings, which can be protracted and costly. Additionally, parties may prefer arbitration for its confidentiality and flexibility in terms of selecting an arbitrator with relevant expertise. However, it also means that parties must adhere to the arbitrator's decision, which can be seen as limiting their control over the outcome compared to mediation.
• Evaluate the implications of having an arbitrator decide on a dispute as opposed to a traditional court setting, particularly in terms of enforceability and appeal options.
  • Having an arbitrator decide on a dispute carries significant implications compared to a traditional court setting. The decisions made by arbitrators are typically enforceable under laws such as the Federal Arbitration Act, making them legally binding without lengthy appeals processes. In contrast, court rulings may involve multiple layers of appeal, which can prolong disputes. However, the scope for appealing an arbitrator's decision is very limited, which can be beneficial for ensuring finality but may raise concerns for parties dissatisfied with the outcome. This trade-off between expediency and limited recourse illustrates key differences in how disputes are resolved through arbitration versus litigation.

Related terms

Arbitration: A method of dispute resolution in which an arbitrator makes a binding decision after hearing arguments and evidence from both parties.

Mediator: A neutral third party who facilitates discussion and negotiation between disputing parties to help them reach a voluntary agreement.

Dispute Resolution Clause: A provision in a contract that outlines the process for resolving disputes, including whether arbitration or mediation will be used.