Business partners getting into conflicts with each other is commonplace. A few conflicts reach such a large scale that the partners have no other option at their disposal but to drag each other to court and settle matters legally. However, no one is quite eager to take this step as there are many things in their business that have to be kept confidential.
If they take the matter to court, all the confidential stuff will get exposed to the public. As a result, there are a lot of companies that choose forced arbitration. Through this, the rights of the employers get compromised. Fortunately, several ways can help you avoid court, and an arbitration agreement is one of them. What is an arbitration agreement, and why is it needed for your business? Get to know.
What is an Arbitration Agreement?
An arbitration agreement happens to be a simple agreement through which you can avoid facing court in case of a dispute. The parties involved in a dispute have lawyers handling their cases in an arbitration agreement. The lawyers would be studying the case in detail, exchange information about why the dispute happened, and bring the witnesses together. The statements of each party will be heard and recorded. Every minute details about the dispute will be taken into account and discussed. As the case nears its completion, the arbitrator will make the final decision based on all the evidence and facts presented by the party’s lawyers.
An arbitration agreement occurs in a conference room. And nobody but the jury, the disputing parties, and their lawyers attend the session. You need to keep one thing in mind. You can’t opt for arbitration if you don’t sign the agreement. By signing the agreement, the parties agree that they will have their dispute arbitrated within four walls and not take it to court. A majority of the arbitration agreements are signed when a business deal is about to begin, not before any dispute.
An Arbitration Agreement is Faster and Cheap
Those of you who know how the world of law works might be aware that the paperwork must be comprehensive. Aside from shelling out the court fees, you need to deal with all the paperwork. Filing the paperwork might be quite expensive and might burn a hole in your pocket.
This is quite normal when you want to settle things in court. With regards to the arbitration agreement, there is neither a court fee nor any paper filing charge. You automatically save money. On top of that, the entire procedure is much faster than court proceedings.
You Don’t Have to Depend on Jury.
When you are opting for an arbitration agreement, you can avoid the jury. That is, you don’t have to depend on the jury for taking your case forward. We can’t deny that a jury can prove quite a helping hand in such cases, but it can also put you under a lot of stress and give rise to many disputes.
There might be some confidential matters related to your business which you wouldn’t want to disclose in front of the court. However, the jury might expose them, and that leads to disputes. Moreover, why would you want the jury to get involved when resolving disputes through an arbitration agreement.
Arbitration Agreements Help You Avoid Hostility
Once a party takes a dispute to court, more disputes and conflicts will arise. It is possible that the hostility would never fade. As a result, the situation becomes quite complicated. Things can become so tough that you might not be able to do any more business with your partner henceforth.
While you are in an arbitration agreement, the calm and relaxed environment in a conference room will help you avoid hostility and a heated exchange of words with your partner. In such a situation, resolving a conflict becomes quite easier. In the presence of an arbitrator, the parties would eventually co-operate with each other. Consequently, you will find an amicable way to settle the dispute.
Arbitration agreements are highly confidential. There is no need to testify anything publicly. The details of the dispute will remain confined within the boundaries of the conference room where the arbitration takes place.