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.
In North Carolina, arbitration is governed by both state and federal law. The North Carolina Arbitration Act (NCAA), found in Chapter 1, Article 45C of the North Carolina General Statutes, provides the framework for conducting arbitration proceedings within the state. This Act outlines the procedures for initiating arbitration, selecting arbitrators, and conducting the arbitration process. It also addresses the enforceability of arbitration agreements and the confirmation, vacating, modifying, or correcting of arbitration awards. Additionally, the Federal Arbitration Act (FAA) may apply to arbitration agreements that involve interstate commerce, preempting state law to the extent of any conflict. Arbitration in North Carolina is a consensual process, meaning that both parties must agree to arbitrate either before or after a dispute arises, typically through an arbitration clause in a contract. The outcome of arbitration, known as an arbitration award, is generally binding on the parties and can be enforced in court, subject to limited grounds for appeal or challenge under the NCAA and the FAA.