What is arbitration in the context of dispute resolution?

Arbitration is an out-of-court method for resolving disputes, which involves the submission of a conflict to one or more arbitrators who make a binding decision. This process allows parties to resolve their disputes without going through the more formal court system, which can be lengthy and costly. In arbitration, the parties generally agree beforehand to accept the arbitrator's decision, thus making it a private and less adversarial approach compared to litigation.

The out-of-court nature of arbitration provides several advantages, such as increased confidentiality, quicker resolution times, and often reduced legal fees compared to traditional court proceedings. As a result, many individuals and businesses prefer arbitration to resolve conflicts in commercial contracts or consumer agreements, leading to a more efficient dispute resolution process.