Mandatory Arbitration Law and Legal Definition

Mandatory arbitration is a form of alternative dispute resolution in which two or more parties are required to submit their dispute to an arbitrator. Such parties should not opt for litigation. It is a contract term that prevents judicial attention from disputes.

In mandatory arbitration, the parties to arbitration will submit their evidence before a selected neutral arbitrator. After that the arbitrators will determine the amount of the arbitration award. If one of the litigants refuses to accept the arbitration award, a lawsuit can be filed to have a trial de novo before a court of law.