Arbitration is a popular way to avoid outright litigation in construction disputes. According to FindLaw, arbitration is similar to litigation, but it is often much cheaper and more streamlined.

What is arbitration?

With arbitration, the parties either hire a single arbitrator or a panel of arbitrators. With a panel of arbitrators, both sides will often pick equal numbers of arbitrators. The arbitrators then hear the case and make a decision.

Most of the time, arbitration is similar to litigation in that the decision made by the arbitrator’s is binding. However, there is also the option to make arbitration non-binding if the parties desire this. With non binding arbitration you may end up in court if both parties are not satisfied with the decision of the arbitrators.

How is this different from litigation?

Litigation involves a neutral, randomly-selected judge. Depending on the nature of your dispute, it may be beneficial for both you and the other party to hire an arbitrator that has experience in your specific field. Additionally, you will not need to sit in the court docket for months to wait for the court system to hear your case. Arbitration can often happen immediately.

Arbitration can also be cheaper in many instances, particularly if the parties elect to hire only one arbitrator. However, this is not always the case and it is possible for arbitration to be more expensive than litigation. It is likely that arbitration will still be faster, though.