Litigation
Litigation
Litigation is the process of taking a case through court. In litigation process, a case (called suit or lawsuit) is brought before a court of law suitably empowered (having the jurisdiction) to hear the case, by the parties involved (the litigants) for resolution (the judgment).
Arbitration
Arbitration is the process of bringing a business dispute before a disinterested third party for resolution. The third party, an arbitrator, hears the evidence brought by both sides and makes a decision. Sometimes that decision is binding on the parties.
Arbitration is a form of alternative dispute resolution (ADR), used in place of in the litigation hope of settling a dispute without the cost and time of going to court.
The arbitration process is private, between the two parties and informal, while litigation is a formal process conducted in a public courtroom.
Arbitration vs. Litigation
|
Arbitration |
Litigation |
Private/Public |
Private – between the two parties |
Public – in a courtroom |
Type of Proceeding |
Civil – private |
Civil and criminal |
Evidence allowed |
Limited evidentiary process |
Rules of evidence allowed |
How arbitrator/judge selected |
Parties select arbitrator |
Court appoints judge – parties have limited input |
Formality |
Informal |
Formal |
Appeal available |
Usually binding; no appeal possible |
Appeal possible |
Use of attorneys |
At discretion of parties; limited |
Extensive use of attorneys |
Waiting time for case to be heard |
As soon as arbitrator selected; short |
Must wait for case to be scheduled; long |
Costs |
Fee for arbitrator, attorneys |
Court costs, attorney fees; costly |