The Difference Between Arbitration and Adjudication

When trying to settle a dispute, there are many avenues one can take. Over the years it has become increasingly clear that court is not the only option out there. Alternative dispute resolution (“ADR”) processes have become more popular and widely accepted, especially since there are many benefits to them. They tend to be cheaper, cost less money, and allow you the opportunity to deal with your matter in both an efficient and effective way.

Arbitration and adjudication are terms that are commonly used together or interchangeably however, there are differences between the two that should be noted. By understanding the difference, you will be able to make a sound decision concerning which route is best for you and your matter.

What is Arbitration?
Arbitration is a voluntary form of ADR that involves parties meeting with an arbitrator to resolve their legal issues. This process is completed without the parties going to court. Arbitration is governed by both federal and provincial Arbitration Act legislations. As previously mentioned, arbitration is a great option because it allows parties to reach a resolve must faster than going through a long and onerous process. Arbitration is also noticeably cheaper compared to court. Many also choose this route because arbitration is private compared to a court hearing that may be open to the public, depending on the nature of the matter.

This process can also give both parties more control over the matter. You will be able to pick your own arbitrator, when you meet with the arbitrator, which documents you share as evidence, and even how you share such evidence. During arbitration, you will be given the chance to present evidence related to things like your income, employment, assets, and liabilities. If you are participating in family arbitration, you would typically also provide evidence related to the needs of your children and the ability for yourself and partner to care for your children.

What is an Arbitrator?
An arbitrator is a neutral party that is present to hear the sides of each party. Although they aren’t a judge, arbitrators act like judges within the process. Many arbitrators are lawyers, paralegals, or other professionals with specialized training like a psychologist. Once they have considered each side, the arbitrator will make a decision. It’s important to note that before arbitration begins, the parties must establish and agree on what the arbitrator will decide on. The arbitrator will be tasked with making decisions based on the applicable law.

The decision that the arbitrator makes is referred to as an award. This award is typically binding on both parties. Before engaging in arbitration, both parties must also seek legal advice. This is crucial because an award in arbitration cannot be enforced in court unless both sides have received legal advice. Before you and the other party hire an arbitrator, it is important to consider certain factors like their experience, their ability to listen and interact during an initial consultation, their ability to answer questions clearly, and the level of comfort felt in their presence.

These could all play a part in how your session is conducted and resolved. If you are looking for a certified arbitrator, you can use the ADR Connect tool provided by the ADR Institute of Ontario:(https://mbr.adric.ca/ADRIC/ADR_Connect/ADRAI/ADR_Connect/ADR_Connect_Search.aspx).

What is Adjudication?
Adjudication is another form of alternate dispute resolution that is commonly sought. In an adjudication, both parties present their dispute to an independent, neutral third party. The claimant will present their evidence and then the respondent will be given an opportunity to also present their evidence. Once complete, the adjudicator will make a decision within 30 days of receiving the claimant’s supporting documentation. This decision is commonly referred to as the determination.

An advantage of proceeding via the adjudication route is that the entire process is relatively quick. They are also much more cost-effective compared to court or arbitration. In adjudication, parties can also customize the process and decide on things like the actual process, the rules, and timelines surrounding the adjudication. A noted difference between adjudication and arbitration is that a decision in adjudication is only binding until a final decision is made in a subsequent proceeding.

That means that once a decision is received by an adjudicator, a party can still commence a proceeding through court or arbitration. Adjudication is commonly used in construction issues which assists greatly in resolving matters instead of potentially halting a project while waiting for a trial to commence. Adjudication can be considered the intermediate step before choosing arbitration or court as a next-step resolution.

What is an Adjudicator?
An adjudicator is an individual who hears the arguments of both parties in a disputed matter and then renders a determination. The adjudicator will consider the arguments from either side along with their accompanying supporting documents and evidence before providing their decision. If one or of both parties do not agree with the determination, they are free to seek other legal recourse through arbitration or court.

The distinction should be made that although a judge can be an adjudicator, not all adjudicators are formally trained judges. Most adjudicators have specialized knowledge in certain subject matters, so it is best to do your research and find one that has experience handling disputes similar to yours.  

Overall, it is positive that more channels are being provided for individuals to seek resolution on a legal matter without having to go to court. Arbitration and adjudication are both faster, cost-efficient, and personalized options for parties that want their issue dealt with as soon as possible. When faced with a legal dispute, always consider your options. Ample consideration could save you a lot of time and money!

If you have questions or concerns regarding which route you should take, contact Oduraa Legal Services today.

Information referenced from:
https://www.ontario.ca/page/family-arbitration
https://stepstojustice.ca/questions/family-law/what-arbitration/
https://odacc.ca/en/adjudication-process/#