Posts Tagged ‘ Binding Arbitration ’

Mandatory Binding Arbitration: Bet you have it, don’t even know it

November 27th, 2009. By Kristine B

Or know what the h*$$ it is…

So, the good news (that’s right, there is some good news these days) is that some companies are dropping the mandatory arbitration clauses in their contracts. Of course, not every company is doing this. And the truth is that most people sign contracts and have no idea that they have signed a mandatory arbitration clause (even I’ve done it). So, this week’s Pleading Ignorance looks at mandatory arbitration. Because what you don’t know about mandatory arbitration really can hurt you.

So, What is Arbitration, Anyway?

Arbitration is a method of resolving disputes that avoids going to court. Now, you may be thinking that avoiding court is good for you—and it can be—but it can also be a bad thing, which I will get into later.

Arbitration involves both sides of a dispute presenting their cases before either one arbitrator (kind of like a judge in a court case but with less power) or an arbitration panel. The arbitrator or the panel then determines who is in the right.

In binding arbitration, the arbitrator not only determines liability (i.e., who’s wrong) but also determines an award for the wronged party (if an award is necessary). Also, the arbitrator’s decision is final. That’s it. No appeals, no further dispute, nothing. Case closed. That can be a good thing, if you find yourself on the winning side but of course, if you’re on the losing side, you have no chance to appeal the decision.

In non-binding arbitration, liability is determined but no award is handed out. The arbitrator can merely suggest possible awards but the two sides do not have accept those suggestions.

Arbitration sounds okay so far, right? Read the rest of this entry »

Tags: Arbitration, Binding Arbitration, Pleading Ignorance
Posted in Emerging Issues, Pleading Ignorance | 2036No Comments »2009-11-27+15%3A33%3A11Kristine+B