Private Arbitration: Can It Help Me Resolve My Legal Problem?

Private Arbitration: Can It Help Me Resolve My Legal Problem?

Private arbitration is an agreed upon method for parties to resolve current or future legal disputes in lieu of traditional court litigation.  Often times, private arbitration is simpler, faster, and cheaper than going to court to trial in civil cases.  However, this is not always the true.  And, sometimes, a public forum is desired to resolve a particular legal dispute over this private method of alternative dispute resolution where proceeding are often confidential and can act to shade the actions of parties in the wrong.  Therefore, you should understand your options and agreements when considering this alternative method of dispute resolution.

Parties can agree in advance to use private arbitration to resolve future legal disputes by contract.  You may have consciously or unknowingly agreed to this alternative dispute resolution mechanism when applying for a credit card, or when buying a good or service online.  Often, private arbitration provisions are buried in the terms and conditions that apply to extensions of credit, or other purchases.  

So, be careful what you “click” since you are binding yourself by contract.  In some limited circumstances, mandatory arbitration clauses can be legally challenged.  But, many businesses use private arbitration clauses to gain a future litigation advantage over a consumer and fighting about this issue after the fact is costly and difficult.  So, please read the applicable terms and conditions that apply to your agreement before you “agree”.  If you unknowingly find yourself in this situation, you should talk to an attorney to consider your legal options if a dispute arises.

Other times, businesses make a concerted effort to utilize private arbitration prospectively when entering into contracts like commercial leases, employment agreements, real estate purchases, or business purchases.  A good and valid reason to do so is to keep related proprietary, confidential, or personal information confidential and otherwise not subject to the exposure of a public trial. There are important advantages to this approach in the right circumstances.  Again, please seek experienced legal counsel when considering this option in any contract your might consider agreeing to be a party to.

A good local resource for businesses and individuals with private arbitration needs is the Arbitration Service of Portland (ASP), which not only provides contractual language to select ASP as a forum for private arbitration but also for arbitration services in other situations.  You can learn more about ASP here: http://www.arbserve.com/

Some private attorneys also serve as arbitrators and provide similar services.  When selecting an arbitrator, you should consider his/her experience and your given legal dispute to ensure that your case is treated competently and fairly.  Reviewing an attorney’s website to determine related practice areas and the local state bar are good steps to take when considering this option.

Another advantage of private arbitration is that it may be simpler to navigate than a traditional trial process in court if you represent yourself.  But, rules, timelines, and deadlines still apply. And, often, private arbitration will result in an arbitration award that can be filed in court to create a judgment and/or lien against the losing party and/or their Oregon real property. Consequently, you should seek competent legal counsel when considering using a mandatory arbitration clause in your contracts and also when you are involved in a lawsuit that is governed by a private arbitration agreement.

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