If your business is involved in a disagreement, it can be time-consuming and disruptive. Preparing for court and waiting for a hearing date is often a lengthy process. This is why alternative dispute resolution, such as arbitration, is increasingly used by businesses to find effective solutions without recourse to litigation.
What is arbitration?
Arbitration is a form of dispute resolution that can result in a legally binding decision. This differs from mediation, where the parties involved have to work together to agree upon the desired outcome. In arbitration, the arbitrator will impose a decision that will be enforceable in the same way as a court judgment.
The arbitration process
Arbitration is a voluntary process, so both parties must agree in advance to enter into it and that they will be bound by the arbitrator’s decision. It is not possible to take a case to court once it has been decided by an arbitrator save some very exceptional circumstances.
A commercial contract will often have clauses setting out how disputes are to be dealt with and arbitration may be stipulated.
The first step is usually a formal ‘request for arbitration’ or ‘notice to arbitrate’ document. This should be drafted in accordance with the rules of the arbitration institution that will govern the proceedings.
The notice should mention the disputed issue and may also include the name of a potential arbitrator.
The party responding to the notice can also nominate an arbitrator.
You should take legal advice before signing a document agreeing to enter into and be bound by arbitration. The agreement will set out how the process will take place including whether there will be one or three arbitrators, how the arbitrator will be selected, where the arbitration will take place and what arbitration rules will apply.
Once the arbitrator is in place, meetings will be held to determine the issues to be decided and a timetable for exchanging evidence.
There will generally be a number of hearings with the opportunity for witnesses and experts to be questioned and arguments made.
The arbitrator will make an award setting out their determination of the case. This can only generally be challenged if they have made an error of law. Otherwise, the award is legally binding and enforceable by either party.
For more information about dealing with legal disputes without resorting to court action see our article about Commercial dispute resolution.
The benefits of using arbitration
There are several benefits to using the arbitration process instead of court litigation. It is generally faster and more cost-effective. It offers more flexibility, including in the outcome that can be awarded by the arbitrator.
All of the issues discussed remain confidential, whereas with court proceedings, documents filed with the court will usually become a matter of public record.
The parties have some control over the process and can agree on certain details such as which arbitrator to use, what timescale to work to, when to hold hearings and how formal the procedure will be.
It is also possible to elect to deal with the matter on submission of documents only and to have short hearings, rather than lengthier court-style hearings.
Contact us
At Witan Solicitors, we have in-depth expertise in helping clients resolve legal disputes. If you are considering arbitration or another form of alternative dispute resolution, we can advise you as to the benefits for your particular situation, put a robust case together on your behalf and represent you throughout the proceedings. Our dispute resolution solicitors understand the importance of resolving your business difficulties and we have an excellent track record of success in helping clients end legal disagreements quickly and efficiently.
If you are involved in a legal dispute and you would like to discuss the options available to you, email us at info@witansolicitors.co.uk or fill in our contact form and we will be happy to help you. We have offices in London, Birmingham and Northampton.
