Financial Expert Witness Communication: A Practical Guide to Reporting and Testimony

CHAPTER 20 Alternative Dispute Resolution: Arbitration

THE ARBITRATION PROCESS

Arbitration is a frequently used form of alternative dispute resolution. It is less formal than litigation, but formalities are built into the process to ensure binding awards will be legally enforceable. Arbitration proceedings are often built into contracts as the agreed-upon form of dispute resolution. It is also a preferred form of resolution over formal litigation because of the perception that arbitration offers: (1) more control for the disputing parties, (2) an expeditious resolution, (3) a cost-effective solution, and (4) more privacy. However, because arbitration is less formal than litigation and the authorities of the arbitrator less powerful than a judge, arbitration can at times feel like a rodeo—hang on to that bull because it can be a fast, bumpy ride!

Arbitration is a process entered into by adversarial disputing parties wherein a neutral party, called an arbitrator, serves as the trier of fact to resolve the dispute. Arbitration awards are typically binding to the disputing parties. However, advisory awards are allowed if such treatment is agreed to in advance by the disputing parties. The arbitration process loosely follows the steps in the litigation process, with a few notable exceptions as discussed next.

STRUCTURE OF ARBITRATION

Similar to formal litigation, arbitration has ...