What is the difference between arbitration and going to court in Ontario?

Arbitration and court litigation are both adjudicative processes that produce a binding decision, but they differ significantly in procedure, cost, speed, and privacy. In arbitration, the parties agree to have their dispute decided by one or more private arbitrators — instead of a judge — under the Arbitration Act, 1991 (Ontario) or, for international commercial arbitrations, the International Commercial Arbitration Act, 2017.

Arbitration is often faster than court because the parties control the scheduling and the process is not subject to court backlog. It is also private — unlike court proceedings, which are generally public, arbitration hearings and awards are confidential. Many commercial contracts include a mandatory arbitration clause, meaning disputes must go to arbitration rather than court.

However, arbitration is not necessarily cheaper. Arbitrators charge for their time (unlike judges, who are publicly funded), and procedural rules often require counsel, so costs can still be significant. The ability to appeal an arbitration award is also very limited under Ontario law — courts will generally only set aside or review an arbitral award in narrow circumstances (such as procedural unfairness or a decision on a matter beyond the arbitrator's jurisdiction).

Whether arbitration or litigation is more appropriate depends on the nature of the dispute, what the contract says, the size of the claim, and the parties' priorities.