GROUP 6

HOW IS ARBITRATION DONE???

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PAYAL, SHUBHRA VISHNU SONI AYUSH SNEHA JHA SIDHARTH MISHRA SHUBHRA SRIVASTAVA PAYAL

WHAT IS ARBITRATION?
GROUP 6

Arbitration, a form of alternative dispute resolution (ADR), is a legal technique for the resolution of disputes outside the courts, where the parties to a dispute refer it to one or more persons (the "arbitrators", "arbiters" or "arbitral tribunal"), by whose decision (the "award") they agree to be bound. It is a settlement technique in which a third party reviews the case and imposes a decision that is legally binding for both sides. 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 disputes to arbitration, without knowing, specifically, what disputes will ever occur) and can be either binding or non-binding. Non-binding arbitration is, on the surface, similar to mediation. However, the principal distinction is that whereas a mediator will try to help the parties find a middle ground on which to compromise, the (non-binding) arbitrator remains totally removed from the settlement process and will only give a determination of liability and, resolution of commercial disputes, particularly in the context of international commercial transactions if appropriate, an indication of the quantum of damages payable. Arbitration is a proceeding in which a dispute is resolved by an impartial adjudicator whose decision the parties to the dispute have agreed, or legislation has decreed, will be final and binding.

Arbitration is a procedure in which a dispute is submitted, by agreement of the parties, to one or more arbitrators who make a binding decision on the dispute. In choosing arbitration, the parties opt for a private dispute resolution procedure instead of going to court.

ADVANTAGES AND DISADVANTAGES OF ARBITRATION

Parties often seek to resolve their disputes through arbitration because of a number of perceived potential advantages over judicial proceedings:

when the subject matter of the dispute is highly technical, arbitrators with an appropriate degree of expertise can be appointed (as one cannot "choose the judge" in litigation) Arbitration is often faster than litigation in court. Arbitration can be cheaper and more flexible for business Arbitral proceedings and an arbitral award are generally non-public, and can be made confidential.
DISADVANTAGES

Arbitration may be subject to pressures from powerful law firms

representing the stronger and wealthier party Arbitration agreements are sometimes contained in ancillary 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 decides the case in some arbitration agreements, the parties are required to pay for the arbitrators, which adds an additional layer of legal cost that can be prohibitive, especially in small consumer disputes in some arbitration agreements and systems, the recovery of attorneys' fees is unavailable, making it difficult or impossible for consumers or employees to get legal representation however most arbitration codes and agreements provide for the same relief that could be granted in court 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 employee there are very limited avenues for appeal, which means that an erroneous decision cannot be easily overturned

ARBITRATION IS NOT APPLICABLE IN FOLLOWING SITUTIONS:

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: 1. Matters relating to crimes, status and family law are generally not considered to be arbitral, as the power of the parties to enter into an agreement upon these matters is at least restricted. However, most other disputes that involve private rights between two parties can be resolved using arbitration. In some disputes, parts of claims may be arbitral 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. 2. 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

MEANING OF ARBITRAL TRIBUNAL

The term arbitral tribunal is used to denote the arbitrator or arbitrators sitting to determine the dispute. The composition of the arbitral tribunal can vary enormously, with either a sole arbitrator sitting, two or more arbitrators, with or without a chairman or umpire, and various other combinations.
In most jurisdictions, an arbitrator enjoys immunity from liability for anything done or omitted whilst acting as arbitrator unless the arbitrator acts in bad faith.

Duties of the tribunal

The duties of a tribunal will be determined by a combination of the provisions of the arbitration agreement and by the procedural laws which apply in the seat of the arbitration. The extent to which the laws of the seat of the arbitration permit "party autonomy" (the ability of the parties to set out their own procedures and regulations) determines the interplay between the two. However, in almost all countries the tribunal owes several non-derivable duties. These will normally be:

to act fairly and impartially between the parties, and to allow each party a reasonable opportunity to put their case and to deal with the case of their opponent (sometimes shortened to: complying with the rules of "natural justice"); and to adopt procedures suitable to the circumstances of the particular case, so as to provide a fair means for resolution of the dispute

ARBITRAL AWARDS
Although arbitration awards are characteristically an award of damages against a party, in many jurisdictions tribunals have a range of remedies that can form a part of the award. These may include: 1. payment of a sum of money (conventional damages) 2. the making of a "declaration" as to any matter to be determined in the proceedings 3. in some jurisdictions, the tribunal may have the same power as a court to: 1. Order a party to do or refrain from doing something ("injunctive relief") to order specific performance of a contract. 2. To order the rectification, setting aside or cancellation of a deed or other document. 4. In other jurisdictions, however, unless the parties have expressly granted the arbitrators the right to decide such matters, the tribunal's powers may be limited to deciding whether a party is entitled to damages. It may not have the legal authority to order injunctive relief, issue a declaration, or rectify a contract, such powers being reserved to the exclusive jurisdiction of the courts

TYPES OF ARBITRATION
1. Judicial Arbitration is, usually, not arbitration at all, but merely a court process which refers to itself arbitration, such as small claims arbitration before the County Courts. 2. High-Low Arbitration, or Bracketed Arbitration, is an arbitration wherein the parties to the dispute agree in advance the limits within which the arbitral tribunal must render its award. It is only generally useful where liability is not in dispute, and the only issue between the parties is the amount of compensation. If the award is lower than the agreed minimum, then the defendant only need pay the lower limit; if the award is higher than the agreed maximum, the claimant will receive the upper limit. If the award falls within the agreed range, then the parties are bound by the actual award amount. Practice varies as to whether the figures may or may not be revealed to the tribunal, or whether the tribunal is even advised of the parties' agreement. 3. Non-Binding Arbitration is a process which is conducted as if it were a conventional arbitration, except that the award issued by the tribunal is not binding on the parties, and they retain their rights to bring a claim before the courts or other arbitration tribunal; the award is in the form of an independent assessment of the merits of the case, designated to facilitate an out-of-court settlement. 4.Pendulum Arbitration refers to a determination in industrial disputes where an arbitrator has to resolve a claim between a trade union and management by making a determination of which of the two sides has the more reasonable position.

INDEX

1. Meaning of arbitration. 2. Characteristics of arbitration. 3. Advantages and Disadvantages 4. Types of arbitration 5. How Arbitration Works 6. Arbitral tribunal 7. Arbitral awards 8. Situations where arbitration is not applicable.

Characteristics of arbitration

Arbitration is consensual

Arbitration can only take place if both parties have agreed to it. In the case of future disputes arising under a contract, the parties insert an arbitration clause in the relevant contract. An existing dispute can be referred to arbitration by means of submission of agreement between the parties. In contrast to mediation, a party cannot unilaterally withdraw from arbitration.

The parties choose the arbitrator(s)

The parties can select a sole arbitrator together. If they choose to have a three-member arbitral tribunal, each party appoints one of the arbitrators; those two persons then agree on the presiding arbitrator. Arbitration is neutral In addition to their selection of neutrals of appropriate nationality, parties are able to choose such important elements as the applicable law, language and venue of the arbitration. This allows them to ensure that no party enjoys a home court advantages.