Parties to an arbitration may be asked to pay for the time of the arbitrator, their own lawyers, if any, the rental of the space where the arbitration is held, or the costs of keeping a transcript of proceedings if one is wanted. Parties may agree to split the common costs, or to let the arbitrator allocate costs as part of the award.

Arbitrators have the power to order one of the parties to pay part of the legal costs of the other. Arbitrators should use the same rules as the courts in making this kind of decision, unless the parties agree otherwise.

It is often thought that arbitrations are cheaper than court-based litigation, because people may agree on a streamlined procedure and avoid delays that may occur in the formal court process.

However, an arbitration that is contested may turn out to be longer and more expensive than going directly to court. The parties may end up in court fighting about the arbitration as well as their original dispute.

Back ·  Table of Contents ·  Next