An arbitration agreement is simply a contract or provision of a contract that requires disputes to be resolved through a process called “arbitration” rather than in court. Arbitration agreements frequently appear in both employment discrimination and construction defect cases. In many ways the arbitration process mirrors that of the court process, however, there are several key distinctions, a few of which are outlined below:
No Jury
Unlike state or federal court, arbitration does not allow a jury trial. Instead, an arbitrator, a neutral party who is often an attorney or retired judge, makes the final decision on the case.
Expensive
Arbitration is much more expensive than state or federal court. Often the terms of an arbitration agreement outline each party’s financial responsibilities and whether expenses will be shared by the parties.
Private Proceeding
Arbitration is a private process, which means there is an element of confidentiality. Cases filed through arbitration are not made available through public records searches.
Location of Proceeding
An arbitration agreement may require the arbitration proceedings take place in another state and/or use laws of another state. This means that an arbitration agreement could require an Alabama resident to travel to another state for arbitration proceedings and may prohibit an Alabama resident from pursuing claims under Alabama state law.
Generally, arbitration agreements are enforceable in Alabama, however, there are circumstances wherein an agreement may be deemed unenforceable. If you have any questions about arbitration, whether an arbitration agreement is enforceable, or how arbitration impacts your claims, feel free to contact us at (205) 588-0699.