Arbitration

• Early Neutral Evaluation
• Expert Determination
• Mediation
• Adjudication

Parties are required to agree to submit disputes to arbitration as an alternative to litigation either through the provisions of their contract or by subsequent agreement. Arbitration can be a very flexible method of ADR. When managed correctly, that flexibility can be used to minimise costs by tailoring the proceedings to the circumstances of the dispute. Indeed, there is a general obligation on the tribunal under the Arbitration Act 1996 to so conduct the proceedings, avoid unnecessary delays and for the parties to co-operate with such expeditious conduct. It may not be said as a rule that arbitration is always cheaper than litigation. 

The intention of arbitration is that it provides a private forum for resolving disputes where the arbitrator is familiar with the core discipline at the heart of the dispute and is better able to understand the arguments put to him/her without lengthy explanations as to technical, commercial or legal issues. However, whilst arbitrators might well understand issues, the system is fundamentally adversarial and arbitrators should not interfere with the process by assisting either party in making their arguments for them. The parties should therefore engage such expertise as is appropriate to make their case and defend their position.

When entering into an agreement to refer disputes to arbitration, parties will generally agree to apply the procedural rules traditionally adopted in their industry or in the standard form of contract selected. Some of these procedures have been in existence for some time and perhaps do not sufficiently reflect current emphasis on achieving proportionality, i.e. keeping recoverable dispute costs in proportion to the sum in dispute. It is worthwhile considering whether the procedure you will be following is robust enough in this respect. If it isn't, consider amending it (at the outset of the contract) or suitably empowering the arbitrator to impose such procedures.

An adjudicator's decision that has not been accepted by one or more parties may, if the parties are so agreed, be referred to arbitration for a binding award. This process is not an appeal against the adjudicator's decision. The tribunal may look at the referred issues afresh without reference to the adjudicator's decision, save for accounting sums paid as a result of it.

Arbitration can vary greatly in procedural complexity from the submission of a case on a 'documents only' basis, where the parties may perhaps never meet or speak with the arbitrator, to full hearings lasting months that resemble court procedures. Unlike court procedures, arbitration is a private form of resolution and arbitrators will follow procedures to ensure that it remains so.

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