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Parties involved in arbitration are effectively
opting out of the court system and submitting their dispute for
resolution by a neutral, third party arbitrator. Arbitration is
generally faster, less expensive and more informal than going to court.
It also has the advantage of being private and confidential.
Federal, state and county laws govern the
arbitration process in conjunction with published Rules of Arbitration used by most
professional arbitrators. Within the limits permitted by law, parties
are free to negotiate some of the ground rules for their arbitration,
such as the number of arbitrators or High-Low parameters. Such
agreed provisions are included in a written Contract to Arbitrate.
Binding arbitration clauses can also be written into most kinds of
contracts, requiring any dispute arising out of the contract to be
resolved by arbitration instead of litigation. A Notice of Intent to
Arbitrate (also called a "Demand for Arbitration") is used to
initiate arbitration under an arbitration clause.
The decision of an arbitrator is as binding on the
parties to the arbitration as a court judgment and can be enforced by
the courts, if necessary.
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