07. Arbitration

This is sometimes described as a 'private version' of going to court. It involves an independent arbitrator who is impartial (someone who doesn't take sides, and who won't gain or lose anything by the outcome). They will hear both sides of the disagreement and make a decision to solve the problem.

You and the other person or company must both agree to go to arbitration.

The process is confidential and so is any amount of compensation that the arbitrator awards. Sometimes the arbitrator makes their decision based on papers that each person gives them to support their case. At other times they hold a hearing where both sides can present their cases. However, this is usually less formal than a court hearing.

Arbitration is binding, so you can't take your case to court after the arbitrator has made a decision unless the arbitrator has made obvious legal mistake or behaved improperly.

When can I use arbitration?

Arbitration can be used for a range of problems. One area where it is often used is to deal with problems with goods and services.

Problems with goods and services

Trade associations for different companies often have arbitration schemes. Some of them run their own schemes, but others are run by an independent organisation called the Chartered Institute of Arbitrators (CIArb).

One example is the Association of British Travel Agents (ABTA), which can arbitrate on, for example, a disagreement about holidays.

If you have a complaint with a business, and they are a member of a trade association, ask the trade association whether they have an arbitration scheme to deal with your problem. You can also contact the Chartered Institute of Arbitrators to see which organisations they run arbitration schemes for (see page 14 for details of how to cantact them).