Arbitration

• most formal type of ADR
• parties agree to let a 3rd party make a binding decision
• the small claims procedure is a form of arbitration
• many businesses, trade unions and professions use arbitration to settle disputes that arises
• governed by the Arbitration Act 1996
• Scott v Avery clause - used in business contracts to state that they will use arbitration
• chose a date and time and they can be as formal/informal as the parties want
• ‘paper arbitration’ - all done through paper - can opt for a hearing
• formal - can use witnesses
• can chose the arbitrator and can be a panel
• the decisions is made by the arbitrator and is final. could be a delay if the arbitrator referres a point of law
• pro - choice of arbitrator
• pro - hearing is chosen on a mutually good time
• pro - procedure is flexible
• pro - private
• pro - quicker
• pro - cheaper
• pro - reaches a binding decision, enforceable through the courts
• con - no legal aid available
• con - some cases include legal issues that unqualified arbitrators can not deal with
• con - professional arbitrators can be expensive
• con - can be expensive for a formal hearing
• con - rights of appeal are limited, rare and difficult
• con - decision by arbitrator cannot always be enforced in the same way as a court judgement
• con - delays for commercial and international arbitration may be the same as court