ARBITRATION

A method of alternative dispute resolution in which the disputing parties agree to abide by the decision of an arbitrator(s).

The submission of a dispute to an impartial third person or persons. The arbitrator or arbitrators are selected directly by the parties or are chosen in accordance with the terms of a contract in which the parties have agreed to use a court-ordered arbitrator or an arbitrator from the American Arbitration Association. If there is no contract, usually each party chooses an arbitrator and the two arbitrators select a third. When parties submit to arbitration, they agree to be bound by and comply with the arbitrators' decision. The arbitrators' decision is given after an informal proceeding where each side presents evidence and witnesses.

Some arbitration proceedings are mandatory (enforced by statute), such as many labor disputes. Other arbitration proceedings are selected in advance and written into contracts. In fact, many couples who sign cohabitation agreements or divorce agreements include a clause agreeing to go to arbitration if any dispute should arise, thereby avoiding the delay, expense, bitterness and formality of litigation. Other arbitration proceedings are chosen by the disputing parties after the conflict arises, but are also to avoid the delay, expense, bitterness and formality of courts.

An agreement to submit a dispute for a hearing and binding decision by a third-party, an arbitrator(s), who is neither a judge or a Court - (read more on Arbitration)
  

Submitting a controversy to an impartial person, the arbitrator,chosen by the two parties in the dispute to determine an equitable settlement.Where the parties agree to be bound by the determination of the arbitrator, theprocess is called binding arbitration. In labor law, arbitration has become animportant means of settling disputes, and the majority of labor contractsprovide for arbitration of disputes over the meaning of contract clauses.