Advantages and Disadvantages of Arbitration and Small Claims Lawsuits



An arbitration hearing may be a better choice than trial for a pro se petitioner (someone representing themselves without a lawyer). Let's review the advantages and disadvantages of both forums...

Advantages of a Small Claims Trial

  • It breaks the deadlock when negotiations stall.

  • A judge or jury decides the outcome of your claim.

  • Filing fees are often less than the cost of arbitration.

  • The court verdict is immediate.

Disadvantages of a Small Claims Trial

  • Your case will be moved along as quickly as possible.

  • A judge can be curt and short of patience.

  • You'll be limited on the monetary amount you can sue for.

  • Either side can appeal the decision to a higher court.

Advantages of Binding Arbitration

  • Arbitration breaks the deadlock when negotiations stall.

  • The arbitrator may have only one or two hearings per day, and will have plenty of time to hear both sides of the claim.

  • The arbitrator is usually very patient.

  • The defending attorneys can't file any legal pleadings to slow the claim down.

  • The decision of the arbitrator is final and can't be appealed.

Disadvantages of Binding Arbitration

  • An arbitrator's fees can be twice as high as the court filing fee.

  • The arbitrator's decision is usually not immediate. You may have to wait a week or more to receive the decision in the mail.

  • The arbitrator's decision is final and can't be appealed.

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