What is the difference between litigation and arbitration?

Whether dealing with a contract dispute, family law issue or other legal matter, it is not uncommon to find yourself faced with a choice: litigate or arbitrate. There are a number of differences between the two legal process. This post will delve into some of the basics to give you a foundational understanding of how both works.

Option #1: Litigation

Litigation, arguably the more well-known of legal processes and fodder of legal dramas due to the possibility of a tense courtroom battle, a judge slamming a gavel, a jury patiently listening to witnesses.

This process is generally a public matter. A judge or jury will hear the evidence, review the information and determine which party is in the right. This final decision is often binding, unless a party chooses to appeal the court’s decision.

Option #2: Arbitration

Arbitration, in contrast, is a private process that allows disputing parties to present evidence and argue their case to an arbitrator. It is less formal then traditional litigation and generally takes less time to complete. Scheduling is less of an issue as the parties are not bound by the court’s calendar as they are during traditional litigation. As a result, arbitration can also be less costly.

Arbitration can occur one of two ways: (1) the parties have agreed to arbitrate in a written contract; or (2) the parties both consent to arbitration.

The final decision in an arbitration is generally a final decision in the case that is not appealable by either side. A judgment in arbitration is just as enforceable as a judgment obtained in litigation.

There are pros and cons about both litigation and arbitration which you should discuss with your attorney.