An arbitration agreement serves as an effective tool, providing important benefits and protections to companies seeking dispute resolution involving customers.
Working with an arbitrator who likely is a former judge or attorney who has extensive experience in the field, the parties will present their side of the story to the arbitrator in an effort to win their case.
Arbitration provides several benefits
An arbitration agreement provides a number of benefits with the most obvious: avoiding a courtroom. Here are additional benefits that an arbitration agreement may provide companies that have disputes with customers:
- Flexibility on rulings: Arbitrators have the ability to devise creative resolutions that may not otherwise be possible if a matter ends up in litigation.
- Economic efficiency: Litigation is expensive. Depositions and evidence collecting cost money and time, which can take years to wind its way through the courts. Arbitration can make things go much faster, at a much lesser cost to companies.
- Confidential: Litigation is a matter of public record. Arbitration is not. A confidentiality order created at the beginning of the process addresses each facet of the arbitration. This would include the hearing, exchange of documents and orders from the arbitrator.
Such key points provide reassurance to companies that rely on arbitration agreements. In short, you can know what to expect from the outset of the process. You can have a much better idea of a worst-case scenario, and take steps to prevent things from happening in the future.
Consider arbitration clauses in your agreements
Should you frequently do business with consumers, especially in circumstances where goods are sold nationwide, you may wish to include an arbitration provision in any contracts or terms-of-service agreements with your consumers. Doing so can help you and your company limit the potential dangers of litigation that may result should a dispute arise.