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The role of arbitration in a business dispute

On Behalf of | Mar 23, 2023 | Mediation & Arbitration

When a dispute arises between you and a business partner, it has the potential to escalate to the point of affecting the entire company. It is important to resolve the dispute in a timely manner and to explore all available options for doing so.

The first avenue that might come to mind is to take the matter to court, though your partnership agreement might outline certain alternative dispute resolutions that you should follow in the event of a disagreement. One such resolution method is arbitration, which you can utilize to the fullest by understanding how it compares to other business dispute resolution options.

Arbitration may be a preferable alternative to courtroom litigation

The arbitration process is similar to standard courtroom procedures, but decisions made by an arbitrator are not necessarily legally binding in the same way as a judge’s ruling. Arbitration is also not a public affair, meaning that your privacy and that of your business remain protected. The flexibility of the arbitration process compared to standard litigation allows it to either be a primary resolution method or a starting point for a broader resolution strategy.

Arbitration can provide a more definitive conclusion than mediation

Partners entering a business dispute also have the option to utilize mediation services offered by the California Civil Rights Department. While mediation can facilitate an amicable and mutually-beneficial outcome, there is the possibility that you might not find a happy compromise. An arbitrator’s decision can grant a sense of finality, especially if both parties agree to abide by that decision ahead of time.

There are several ways to resolve a business dispute and none offer a one-size-fits-all solution. Arbitration is one option that fulfills the role of providing an impartial judgment without risking privacy or legally-binding consequences.