Compromissory arbitration is a voluntary method of resolving disputes between two parties. It involves a neutral third party who makes a decision that both parties agree to abide by. This type of arbitration is commonly used in international disputes and is based on a mutual promise to define the scope of the disagreement. It differs from other forms of arbitration, such as grievance arbitration or interest arbitration, which are designed to address specific types of conflicts. Both parties must agree to the process in order for compromissory arbitration to take place.
Compromissory arbitration involves the resolution of disputes between two parties with the assistance of a neutral third party. The third party is mutually agreed upon by both parties and their decision is legally binding. For instance, in international arbitration, two companies from different countries may opt for compromissory arbitration to settle their dispute. They would sign a mutual agreement outlining the scope of the dispute and commit to following the arbitrator’s decision. Similarly, two individuals may choose to resolve their dispute through arbitration instead of going to court. They would select an arbitrator and agree to abide by their decision. It is important to note that compromissory arbitration differs from voluntary arbitration, where both parties agree to arbitration without any prior agreement.
Compromissory arbitration is a form of alternative dispute resolution where parties agree to submit their dispute to an arbitrator or panel of arbitrators who will make a binding decision.
Yes, compromissory arbitration is legally binding. Once the parties agree to submit their dispute to arbitration, they are bound by the decision made by the arbitrator(s).
Yes, parties can choose to opt for compromissory arbitration instead of going to court. It is a voluntary process that allows parties to resolve their disputes outside of the traditional court system.
Compromissory arbitration can be used to resolve a wide range of disputes, including commercial disputes, employment disputes, construction disputes, and even family law disputes.
While both compromissory arbitration and mediation are forms of alternative dispute resolution, they differ in their outcomes. In mediation, the mediator helps the parties reach a mutually acceptable agreement, whereas in compromissory arbitration, the arbitrator(s) make a binding decision.
In most cases, the decision made in compromissory arbitration is final and binding. However, there may be limited grounds for appeal, such as if there was a procedural error or if the arbitrator(s) exceeded their authority.
The parties involved in the dispute typically have the freedom to choose their arbitrator(s). It is important to select an arbitrator who is impartial, experienced, and knowledgeable in the relevant area of law.
Some advantages of compromissory arbitration include its flexibility, confidentiality, and the ability to choose an arbitrator with expertise in the specific subject matter of the dispute. It is also generally a faster and more cost-effective process compared to litigation.
Yes, the decision made in compromissory arbitration can be enforced through the courts. Once the decision is rendered, it can be converted into a court judgment, which can then be enforced like any other court judgment.
In most cases, once the parties have agreed to compromissory arbitration and the decision has been made, they are bound by that decision and cannot pursue litigation. However, it is important to review the specific terms of the arbitration agreement to determine the parties’ rights and obligations in such situations.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 25th April 2024.
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