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How does arbitration work in a construction law dispute?

Many contracts include provisions regarding how to deal with disputes. Construction law is no exception. Using arbitration instead of proceeding directly to a Massachusetts court can keep costs down and keep the dispute private, which could protect the parties involved from any potential negative repercussions from the public.

Before signing a contract that includes an arbitration provision, it may help to gain at least a rudimentary understanding of the process. One of the parties will submit a demand for arbitration to which the other party will respond after receiving notice from the organization providing the service. One such entity is the American Arbitration Association. 

Then the parties choose an arbitrator. This choice often depends on the type of dispute, which means that this person chosen will need to meet certain criteria, not the least of which is whether the individual has experience in the industry and understands the laws that apply to it. For instance, for a construction dispute, the arbitrator should have experience in the industry, experience with its law or preferably both.

Thereafter, the parties attend a preliminary hearing, prepare and exchange information, and then attend one or more hearings. After that, the arbitrator may allow the parties to provide additional information for consideration. The arbitrator then gives the parties a decision and an accompanying award, if applicable.

Remembering that this is a truncated version of arbitration, a Massachusetts business may have enough information to decide to sign a contract containing such a provision or using it if a dispute arises. Moving through the process will more than likely require some legal assistance in order to present the best case possible, especially since the decision may be binding. In a binding arbitration, whether under construction law or some other area of law, both parties agree to be bound by the decision made by the arbitrator, so typically, going to court thereafter will not be possible.

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