Presentation 9 PDF

PRESENTATION 9 ADVANTAGES AND DISADVANTAGES Parties often seek to resolve disputes through arbitration because of a number of perceived potential advantages over judicial proceedings In contrast to litigation, where one cannot "choose the judge", arbitration allows the parties to choose their own tr...

PRESENTATION 9 ADVANTAGES AND DISADVANTAGES Parties often seek to resolve disputes through arbitration because of a number of perceived potential advantages over judicial proceedings In contrast to litigation, where one cannot "choose the judge", arbitration allows the parties to choose their own tribunal. This is especially useful when the subject matter of the dispute is highly technical: arbitrators with an appropriate degree of expertise (for example, quantity surveying expertise, in the case of a construction dispute, or expertise in commercial property law, in the case of a real estate dispute) can be chosen Arbitration is often faster than litigation in court.. : Arbitral proceedings and an arbitral award are generally non-public, and can be made confidential 2 ADVANTAGES CONTINUED: In arbitral proceedings the language of arbitration may be chosen, whereas in judicial proceedings the official language of the country of the competent court will be automatically applied Because of the provisions of the New York Convention 1958, arbitration awards are generally easier to enforce in other nations than court verdicts In most legal systems there are very limited avenues for appeal of an arbitral award, which is sometimes an advantage because it limits the duration of the dispute and any associated liability... 3 ADVANTAGES CONTINUED: Arbitration can be either voluntary or mandatory (although mandatory arbitration can only come from a statute or from a contract that is voluntarily entered into, where the parties agree to hold all existing or future disputes to arbitration, without necessarily knowing, specifically, what disputes will ever occur). 4 SOME OF THE DISADVANTAGES INCLUDE: Arbitration agreements are sometimes contained in supplementary agreements, or in small print in other agreements, and consumers and employees often do not know in advance that they have agreed to mandatory binding pre-dispute arbitration by purchasing a product or taking a job If the arbitration is mandatory and binding, the parties waive their rights to access the courts and to have a judge or jury decide the case If the arbitrator or the arbitration forum depends on the corporation for repeat business, there may be an inherent incentive to rule against the consumer or employe There are very limited avenues for appeal, which means that an erroneous decision cannot be easily overturned Although usually thought to be speedier, when there are multiple arbitrators on the panel, juggling their schedules for hearing dates in long cases can lead to delays.... e 5 DISADVANTAGES …… In some legal systems, arbitration awards have fewer enforcement options than judgments; although in the United States arbitration awards are enforced in the same manner as court judgments and have the same effect. Arbitrators are generally unable to enforce interlocutory measures against a party, making it easier for a party to take steps to avoid enforcement of member or a small group of members in arbitration due to increasing legal fees, without explaining to the members the adverse consequences of an unfavorable ruling. Discovery may be more limited in arbitration or entirely nonexistent. The potential to generate billings by attorneys may be less than pursuing the dispute through trial. Unlike court judgments, arbitration awards themselves are not directly enforceable. A party seeking to enforce an arbitration award must resort to judicial remedies, called an action to "confirm" an award. 6 DO ALL DISPUTES COULD BE RESOLVED BY ARBITRATION? By their nature, the subject matter of some disputes is not capable of arbitration. In general, two groups of legal procedures cannot be subjected to arbitration Procedures which necessarily lead to a determination which the parties to the dispute may not enter into an agreement upon: Some court procedures lead to judgments which bind all members of the general public, or public authorities in their capacity as such, or third parties, or which are being conducted in the public interest. For example, until the 1980s, antitrust matters were not arbitrable in the United States. Matters relating to crimes, status and family law are generally not considered to be arbitrable, as the power of the parties to enter into an agreement upon these matters is at least restricted : 7 CONTINUED However, most other disputes that involve private rights between two parties can be resolved using arbitration. In some disputes, parts of claims may be arbitrable and other parts not. For example, in a dispute over patent infringement, a determination of whether a patent has been infringed could be adjudicated upon by an arbitration tribunal, but the validity of a patent could not: As patents are subject to a system of public registration, an arbitral panel would have no power to order the relevant body to rectify any patent registration based upon its determination. CONTINUED Some legal orders exclude or restrict the possibility of arbitration for reasons of the protection of weaker members of the public, e.g. consumers. Examples: German law excludes disputes over the rental of living space from any form of arbitration, while arbitration agreements with consumers are only considered valid if they are signed by either party, and if the signed document does not bear any other content than the arbitration agreement SAUDI LAW OF ARBITRATION. ROYAL DECREE NO. M/ 34 1/1 Arbitration Agreement: it is an agreement between two or more parties to refer 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 non-contractual. An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate arbitration agreement. 2. Without prejudice to provisions of Islamic Sharia and international conventions to which the Kingdom is a party, the provisions of this Law shall apply to any arbitration regardless of the nature of the legal relationship subject of the dispute, if this arbitration takes place in the Kingdom or is an international commercial arbitration taking place abroad and the parties thereof agree that the arbitration be subject to the provisions of this Law. 10 CONTINUED Art.2. para.2 The provisions of this Law shall not apply to personal status disputes or matters not subject to reconciliation. Article 4 In cases where this Law allows the parties to arbitration to choose the procedure to be followed in a certain issue, this shall include the right of the two parties to authorize a third party to choose that procedure. A third party in this respect includes any individual, tribunal, organization, or arbitration center within the Kingdom or abroad.. 11