Arbitration Services
What is Arbitration?
In an arbitration, a neutral third party, called an arbitrator, is selected to issue a legally binding ruling in a dispute between two or more parties. Unlike mediation, where the mediator helps parties reach a non-binding agreement, the arbitrator’s final decision is legally binding and enforceable in court, much like a judge’s ruling.
Numerous legal issues, such as those involving contracts, employment, property, and other areas, can be settled through arbitration. Arbitration is becoming increasingly common in Ontario as a faster, more flexible, and private means for parties to resolve disputes compared to traditional court proceedings.
Benefits of Arbitration:
- Binding Decision: The arbitrator's decision is final and legally enforceable.
- Quicker Resolution: Arbitration is generally faster than going through the formal court system.
- Confidentiality: Arbitration proceedings are private, which can be appealing for businesses or individuals seeking to keep their matters out of the public eye.
- Flexibility: The process can be tailored to meet the needs of the parties involved, including choosing the arbitrator, setting timelines, and determining procedural rules.
- Cost-Effective: Arbitration can often be less costly than prolonged court battles, especially in complex cases.
Steps in the Arbitration Process
1. Referral to Arbitration Services
The arbitration process typically begins when the parties involved agree to resolve their dispute through arbitration. Arbitration can be voluntary, or the parties may be contractually obligated to arbitrate a dispute. Referrals to arbitration can come from:
- Voluntary agreement: Both parties mutually agree to resolve the dispute through arbitration.
- Contractual obligation: Many business contracts or employment agreements include arbitration clauses that require arbitration in case of a dispute.
- Court referral: In some cases, a court may suggest or require arbitration as a means of resolving the dispute outside of litigation.
2. Selecting the Arbitrator
Once arbitration has been agreed upon, the next step is to choose an arbitrator. The arbitrator is a neutral third party who has the necessary expertise in the subject matter of the dispute. The parties involved may:
- Select a single arbitrator: Both parties mutually agree on one arbitrator.
- Form a panel: For more complex cases, a panel of arbitrators (usually three) may be chosen.
The arbitrator or arbitration panel will set the rules of the proceedings, including scheduling hearings and determining how evidence will be presented.
3. Pre-Arbitration Conference
Before the formal arbitration hearing, a pre-arbitration conference may be held. During this conference, the arbitrator will:
- Clarify the issues to be addressed.
- Discuss procedural matters and the rules for presenting evidence.
- Set a schedule for the arbitration hearing.
- Confirm the availability of all necessary documentation and witnesses.
This pre-conference helps ensure that both parties understand the arbitration process and agree on the basic framework before the formal hearing begins.
4. Arbitration Hearing
The arbitration hearing is where the parties present their case to the arbitrator. This hearing is typically more informal than a courtroom trial but still structured. During the hearing:
- The arbitrator listens to the arguments from both sides.
- Evidence is presented, which may include documents, witness testimony, or expert opinions.
- The parties have the opportunity to make their case and cross-examine witnesses if applicable.
The arbitrator controls the process and may ask questions or clarify points to ensure that all relevant information is provided. The hearing is usually conducted in person, but it can also take place via video or teleconference, depending on the preferences of the parties and the arbitrator.
5. Award Issued by the Arbitrator
After the arbitration hearing, the arbitrator will deliberate and issue an award, which is a formal written decision. The award will outline the arbitrator’s findings, the reasoning behind the decision, and the final resolution of the dispute. The award may address:
- The terms of settlement or resolution.
- Financial awards or penalties (if applicable).
- Any corrective actions or actions that must be taken by the parties involved.
The arbitrator’s award is binding and legally enforceable, meaning the parties must comply with the terms of the award. If one party refuses to comply, the other party may seek enforcement through the courts.
6. Post-Arbitration and Enforcement
Once the arbitrator has issued the award, the parties must comply with the decision. If either party fails to do so, the award can be enforced in court. The steps for enforcing an arbitration award include the following:
- Filing the award with the court: The party seeking enforcement can file the arbitration award with the Ontario Superior Court of Justice, where it will be recognized as a court order.
- Seeking judicial assistance: If necessary, a party can request the court to take further action to compel compliance with the award.
In most cases, arbitration awards are adhered to without the need for enforcement, as they are legally binding, and both parties have agreed to abide by the arbitrator’s decision in advance.
Why Choose Arbitration?
Arbitration has several benefits over conventional court proceedings, and many people and corporations choose it for the following:
Binding Decisions
The parties involved can rest easy knowing that the arbitrator’s ruling is final and enforced by law.
Faster and More Efficient
It typically takes less time and money than going through the legal system.
Privacy
Control Over the Process
Cost-Effective
Control Over the Process
Arbitration is an effective, efficient, and flexible method of resolving disputes in Ontario, whether for commercial, contractual, or other types of disagreements. By choosing arbitration, parties can resolve their issues quickly and with minimal public exposure.
Links to Arbitration Resources in Ontario
1. Accredited Mediators in Ontario Ontario Association for Family Mediation (OAFM)
- Website: https://www.oafm.on.ca/mediator-search/ Family Dispute Resolution Institute of Ontario (FDRIO)
- Website: https://fdrio.ca/about-us-old__trashed/member-directory/#/cid/1851/id/201
2. Ontario Court of Justice – Arbitration Resources
The Ontario Courts’ website provides resources for individuals or businesses seeking information on arbitration services and how to use them within the legal system.