Arbitration is a quasi-judicial process in which a neutral person sits as a private judge and resolve the dispute of the parties in confidential manner.
We will assist you with Arbitration and Alternative Dispute Resolution (ADR) has four branches for dispute resolution process, mainly:
Arbitration is a private process, as the initiation of arbitration is under an agreement. It may be less adversarial, less formal or flexible with the adoption of similar procedure. Arbitration does not follow any formal rule of evidence. The findings are limited to some documents, with no interrogatories and depositions. The disputed parties select the adjudicators, which are selected on the basis of their experience and expertise. The decisions are not formally made as precedents to any other arbitration. The arbitrators are empowered only to grant compensatory damages including provisional relief.
In litigation, parties to the dispute have no voice in selection of adjudicators, Judge or jury. Adjudicators apply the laws and decisions of High Court and Supreme Court are precedents for subordinate courts. Remedy in the form of appeal against the decision of the court is available to the disputed parties. Remedies may include compensatory and punitive damages, injunctive relief. The complete process of litigation is generally expensive.
Advantages of Arbitration? Why Arbitration?
- Parties are free to appoint the person of their choice as arbitrators.
- Arbitration entitles the parties to agree upon procedural rules to be followed by the arbitral tribunal in conducting the procedure
- Much less expensive and less time consuming than court litigation
- Ensures a fair trial by an impartial tribunal
- Arbitration gives the parties freedom from d=judicial intervention, except where necessary
- Parties have the freedom to choose a place for the arbitration proceedings
- The proceeding are conducted in private and protected by the laws of confidentiality.
- An arbitral award has the enforceability of that of a decree of court.
Steps to arbitration proceedings
- The party that wants to start the arbitration will make a written request for arbitration, setting out the details of their claim. The party who files for arbitration is called the claimant. The other party is called the respondent.
- Arbitrators are appointed to decide the dispute.
- The parties are given an opportunity to argue their positions and provide evidence in support. Usually, this is done by the parties’ legal representatives, who may be internal representatives or external legal advisors. Legal representatives present their arguments through submissions, which can be written or oral (or both). When submissions are made orally, this is called a hearing, and is usually done in person, although it can also be by telephone or by videoconference.
- Having heard the parties’ arguments, the arbitrator(s) will decide the dispute, and make an award.
What is an Arbitration Agreement?
Section 7(1) of the Arbitration and Conciliation Act 1996 provides for the definition of Arbitration Agreement and defines as an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not.
Arbitration Agreement may contain exchange of letters or any other means of telecommunication which provides a record of the agreement, including communication through electronic means. It need not to be signed but must be in writing.
Types of Arbitration procedures
- Ad-hoc Arbitration - agreed to and arranged by the parties themselves without recourse to an arbitral Institution. It is to get the justice, in the balance of the unsettled part of the dispute only. It may be either International or domestic arbitration.
- Domestic Arbitration - the arbitral proceedings are held in India, and in accordance with India substantive and procedural laws, and the cause of action for the dispute has wholly arisen in India, where the parties are subject to the Indian jurisdiction.
- Institutional Arbitration - In order to facilitate the arbitral proceedings, section 6 of the act provides that the parties, or the tribunal, on the consent of the parties, can arrange arbitral assistance of a suitable institution. In other words, Institutional Arbitration is an arbitration done with the help of a well-known recognized manner of an institution.
- Statutory Arbitration - Where the reference to arbitration emanates from enactment of the Parliament or a state legislature, the arbitration is called statutory arbitration. It is conducted in accordance with the provisions of enactment which specifically provides for arbitration in the respective dispute arising on matters covered by the concerned enactment bye-laws are rules made thereunder having the force of law.
- Fast track Arbitration/Documents only Arbitration -
Fast Track arbitration is a time-bound arbitration, with stricter rules of procedure, which does not allow for any laxity or scope for extensions of time and delays. It is a kind of arbitration that is not oral and is based on the claim statement and statement of defence, and a written reply by the claimant, if any.
the reduced span of time makes it cost-effective.
- Look Sniff Arbitration - hybrid arbitration, and also known as quality arbitration. It is a combination of the arbitral process and expert opinion on the basis of the evidence and inspection of goods or commodities that are subject matter of the dispute placed before the arbitrator, who is selected based on his specialised knowledge expertise and experience in a particular area of trade or business. The arbitrator decides the dispute and makes his award the award related to the quality of price of the goods or both.
- Flip-Flop Arbitration - the parties formulate their respective cases beforehand. They then invite the arbitrator to choose one of the two. On the evidence adduced by the parties, the arbitrator decides which submission is the correct submission and then makes an award in favour of that party.
- International Commercial Arbitration - relating to disputes arising out of legal relationship, whether contractual or not, considered as commercial under the law in force in India
Yes, the decision taken by the arbitration court is binding on the [arties into the arbitration as a decision taken by any court of law making adjudication in the matter.
Generally, only the civil disputes are handled by the arbitration tribunal.
There is no hard and fast rule that the one is better than other, but generally arbitration is preferred more than the litigation as it is less expensive, it provides faster resolution than litigation through simpler rules and flexible time.
If the parties or not able to agree as to who will be the arbitrator or one of the parties is reluctant to co-operate in appointing the arbitrator, the other party will have to use Section 11 of the Arbitration and Conciliation Act, 1996 wherein the Chief Justice of a High Court or the Supreme Court are there doesn't it will appoint the arbitrator.
Fast Track arbitration are best suited in those cases which can be decided on the basis of documents, in which oral hearing and witnesses are not necessary.
Indian arbitration act does not specifically exclude any category of disputes as being not arbitral. However , section 34(2)(B) and 48(2) of the Indian arbitration act make it clear that an arbitral award will be set aside if the court finds that the subject matter of the dispute is not capable of settlement by arbitration under the laws of India for the time being in force.
- Disputes relating to rights and liabilities which give rise to or arising out of criminal offences
- Matrimonial disputes relating to divorce, judicial separation, restitution of conjugal rights, child custody, etc.
- Guardianship matters
- Insolvency and winding up matters
- Testamentary matters (Grant of probate, letters of Administration and succession certificate)
- Eviction of tenancy matters governed by special statutes where the tenant enjoy statutory protection against eviction and only the specified codes are conferred jurisdiction to grant eviction or decide the dispute
- Arbitration clause in a contract
- Separate arbitration agreement
- Arbitration agreement by incorporation
Yes, it is required that both the parties to attend the proceedings.
Depending on the rules and the parties' arbitration agreement, the date the award must be given to the parties may differ, but it is usually between 14 and 30 days from the close of hearings.