Make sure you read through any documents that detail how the arbitration will be used to resolve any disputes. Various types of arbitration may be referenced or used. Here are some examples of the most common ones.
Mandatory Arbitration
This may be referred to as quartered in arbitration or judicial arbitration. This is a scheme for the resolution of a pending court case, typically those that are valued at under $50,000 in damages. These still may be related to some court procedures, but use informal rules of evidence in advisory nonbinding arbitration that is ordered by the court. This is generally ordered in the early stages of a lawsuit to try to encourage people to come to terms of agreement on their own. The exact availability and requirements of using this process will depend on court procedures and local or state laws.
Non-Binding Arbitration
When an arbitrator issues an award after a hearing in non-binding arbitration, this means that the parties do not give up their right to a jury trial, and this agreement is not binding at all. The arbitrator's award, however, is instead a recommended or advisory opinion. Many cases go on to binding arbitration or settlement after this phase or may even continue on to a trial.
Baseball Arbitration
This binding arbitration type requires each of the parties to select one number that would resolve the case, and the arbitrator may choose only one of the figures as an award. This means there are only two possible outcomes and can greatly streamline the handling of the case.
High-Low Arbitration
In this situation, both parties must agree in advance to the parameters under which the arbitrator is allowed to render their award. This can include a preset high or low number. If the award is higher than the preset high, the plaintiff must accept the agreed-upon high. If the award is lower than the preset low, the defendant must pay the previously set low amount. If the amount is in between, the parties must agree to be bound by the arbitrator's figure, and the low or high figures are not necessarily shared with the arbitrator in these circumstances.