Advantages and Disadvantages of Arbitration In Construction
Looking for advantages and disadvantages of Arbitration In Construction?
We have collected some solid points that will help you understand the pros and cons of Arbitration In Construction in detail.
But first, let’s understand the topic:
What is Arbitration In Construction?
Arbitration in construction is a process where a neutral person, called an arbitrator, helps solve disputes between parties involved in a construction project. This is done outside the court, making it faster and less formal.
What are the advantages and disadvantages of Arbitration In Construction
The following are the advantages and disadvantages of Arbitration In Construction:
| Advantages | Disadvantages |
|---|---|
| Faster dispute resolution | Can be costly |
| Lower costs than court | Limited appeal options |
| Privacy in proceedings | May lack transparency |
| Expert arbitrators in construction | Potential for bias |
| Flexible process and schedule | Time-consuming process |
Advantages of Arbitration In Construction
- Faster dispute resolution – Arbitration in construction offers a quicker way to resolve disagreements than traditional court proceedings, which often involve lengthy and time-consuming processes.
- Lower costs than court – It’s a cost-effective method as well, since it tends to be less expensive than taking a dispute to court, reducing financial strain.
- Privacy in proceedings – The proceedings are private, meaning the details remain confidential and don’t become public record, preserving reputations.
- Expert arbitrators in construction – The process benefits from expert arbitrators who have specific knowledge and experience in the construction field, leading to informed decisions.
- Flexible process and schedule – Finally, arbitration provides a flexible process and schedule, allowing parties to agree on times and dates that suit them, reducing disruption to business operations.
Disadvantages of Arbitration In Construction
- Can be costly – Arbitration in construction can lead to high costs due to the fees of arbitrators and other related expenses.
- Limited appeal options – The process offers limited options for appeal, which means that parties may have to accept an unfavorable decision.
- May lack transparency – There might be a lack of transparency as proceedings and decisions are typically private and confidential.
- Potential for bias – There’s a potential for bias as the arbitrator is usually chosen by the parties involved, raising questions about impartiality.
- Time-consuming process – It can be a time-consuming process, as scheduling conflicts and complex issues can prolong the resolution.
That’s it.
Also see:
- Advantages and disadvantages of Arbitration Agreement
- Advantages and disadvantages of Arbitration
- Advantages and disadvantages of Arbitrage Pricing Theory
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