Arbitration Can Be Expensive

Arbitration is an extremely popular mechanism for the resolution of commercial disputes.  One of the main advertised benefits of arbitration is that it is more cost-effective than traditional litigation.  While this is often true, it does not mean that arbitration is always cheap.  Indeed, filing, administrative, and arbitrator fees in major disputes can be substantial. 

In addition, while arbitration costs are typically recoverable by the prevailing party, the risk of losing alone can deter parties from bringing an arbitration to enforce their rights.

An Illustration

Experienced arbitrators often charge several hundred dollars per hour.  In the example of a three-arbitrator panel – which is common in commercial arbitration – a two-week hearing at the average cost of $500/hour will cost $120,000 in arbitrator fees alone.  This does not include additional fees for conferences, motion practice, interim awards, and the final award.  In total, arbitration fees alone can have a cost in the mid-six-figures. 

How Parabellum Helps

Parabellum provides funding to assist parties in arbitration.  Our funding is always non-recourse.  That means we bear the risk of sunken costs and fees for unsuccessful claims.

Arbitration has many benefits, but its costs should not be prohibitive.  Contact us to learn how we can defray arbitration costs and enable your business to succeed and collect on its claims.