What Is Arbitration? Explained in 60 Seconds
Arbitration is a private way to resolve disputes outside the courts. The parties agree to use arbitration and jointly choose a neutral arbitrator, whose binding decision is called an award. Appeals are very limited.
This video is general information, not legal advice. Arbitration rules vary by country and by contract — speak to a qualified lawyer about your situation.
Key takeaways
- Parties agree in advance to arbitrate, usually through a contract clause.
- They choose a neutral arbitrator together.
- The arbitrator’s decision, called an award, is binding.
- Disliking the result is not enough to appeal in court.
- The New York Convention allows awards to be enforced in over 170 countries.
What this video covers
The video explains arbitration as a private way to resolve disputes outside the courts. It introduces the idea through a missing sandwich: all the evidence points to Gerald the goose, and the dispute is settled by arbitration instead of going to court. First, the parties agree in advance to use arbitration, usually through an arbitration clause in their contract. Next, they choose a neutral arbitrator together. The video describes this person as a private judge. The arbitrator’s decision is called an award, and it is binding. The video then explains that appeals are very limited: a party cannot go to court simply because they dislike the result. Finally, it covers enforcement. Thanks to the New York Convention, arbitration awards can be enforced in over 170 countries. The video also explains that arbitration is usually faster and more confidential than court, which is why it is common in international business contracts. It suggests checking your contracts because they may already contain an arbitration clause. The video provides general information, not legal advice: rules vary by country and contract, so it recommends speaking to a qualified lawyer about your situation.
