Arbitration is a private, out-of-court dispute resolution process—usually between parties to a contract—in which the dispute is resolved by one or more arbitrators rather than by judges and juries in the court system. Businesses often include an arbitration provision in the dispute resolution section of a wide variety of contracts or agreements with other business entities.

In Indiana, arbitration is governed by both state law and federal law, depending on the nature of the dispute. The Indiana Uniform Arbitration Act (IUAA) provides the framework for arbitration proceedings within the state. This Act outlines the procedures for initiating arbitration, selecting arbitrators, conducting hearings, and confirming, vacating, or modifying arbitration awards. Arbitration clauses are generally enforceable in Indiana, and courts will compel arbitration if there is a valid arbitration agreement between the parties and the dispute falls within the scope of that agreement. However, certain disputes may not be subject to arbitration if they involve issues of public policy or statutory rights that are non-waivable. On the federal level, the Federal Arbitration Act (FAA) may apply, particularly in cases involving interstate commerce or where federal law is implicated. The FAA similarly supports the enforcement of arbitration agreements and seeks to ensure that such agreements are treated on equal footing with other contracts. It's important for businesses to carefully draft arbitration provisions to ensure they meet legal requirements and accurately reflect the intentions of the parties.