Arbitration is the determination
of the dispute by one or more independent third parties (the arbitrators)
rather than by a court. Arbitrators are appointed by the parties
to the dispute in accordance with the terms of an arbitration
agreement or in default by a court
The main Irish law governing arbitration is the Arbitration Act
of 1954 and the Arbitration Act 1980.
The advantages of arbitration
Firstly arbitration proceedings are held in private and are neither
known to nor reported by outsiders.
Secondly with the cooperation of the parties and the adoption
of the most suitable procedure for dispute, the arbitral process
can be expeditious and less expensive than court proceedings.
Thirdly because the arbitrator is usually chosen as an expert
in the field concerned, there is not the same need for numerous
expert witnesses.
Fourthly the arbitrator's award is final and binding on the disputants.
Unlike a court judgement which can be changed on appeal, there
are few grounds on which party can appeal to the courts to have
an arbitrator's award set aside. These grounds generally relate
to technical errors by the arbitrator and not to the starters
or resources of the parties.
The arbitration process
Where a dispute has arisen the first step is to appoint an arbitrator
this can be done before consulting a solicitor who services may
turn out to be a necessary. Normally one arbitrator is appointed
as multiple arbitrators are rarely needed except in complex international
disputes.
An arbitrator can be appointed in one of the following ways:
1. Where the dispute arises under a contract which contains an
arbitration clause, the provisions of that clause should be followed.
Unless the parties agree otherwise, this is obligatory and proceedings
may usually be initiated by any party.
2. The parties may agree between themselves on the selection of
an arbitrator but in practice this rarely occurs.
3. The parties may request the nomination of an arbitrator, for
appointment by the parties, by applying to the Chartered Institute
of Arbitrators at 8 Merrion Square Dublin 2. This method has the
advantage of ensuring the appointment of a trained arbitrator
being selected from the many available panels of members of different
disciplines.
4. Where there is no arbitration agreement, a party may apply
directly to the courts that a dispute be referred to arbitration.
If the application is successful, the court will appoint the arbitrator.
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The proceedings
Once an arbitrator has been appointed to hear the dispute, the
arbitrator will usually arranged a preliminary meeting between
himself and the representatives of the disputing parties to set
out the procedure to be followed for the hearing, the fees chargeable
by the arbitrator, and the timeframe for the hearing of the dispute.
The parties are free to either represent themselves or to have
a technical expert or a solicitor or barrister represent them.
All correspondence between the arbitrator and the disputing parties
is copied to all other parties at the same time. The time required
for the procedure is will vary between different disputes but
it should usually be possible to complete them all within 2 to
3 months. The arbitrator may direct that a full formal hearing
be arranged. The arbitrator will usually issue a direction on
the exchange of points of claim between the parties and the exchange
of supporting documentation.
The award
The arbitrator on payment of his fees will issue his award in
writing as soon as possible after the conclusion of the hearing.
The award will normally be a short statement setting out the payment
of damages and costs etc. Such award may be enforced through the
courts if necessary.
Mediation
Mediation involves a third-party
intervening, bringing proposals and counterproposals to the parties
and encouraging them to settle the matter.
Great emphasis has been placed in mediation as a
route of dispute resolution by the courts. For example in the
area of family law the parties wishing to negotiate terms of a
separation agreement may do so without the assistance of a mediator
or a solicitor representing spouse independently. Under Sections
5 and 6 of the Judicial Separation & Family Law Reform Act
1989, the solicitors acting for either party to a separation agreement
or to judicial separation proceedings are obliged, prior to instituting
such proceedings, to discuss with their clients the possibility
of reconciliation and or mediation to help affect a separation
on agreed basis.
The solicitors further obliged under this legislation
to supply the names and addresses of persons qualified to provide
a mediation service. Mediation is considered by the courts to
be suitable for delicate matters such as family law and that an
attempt should be made to avoid the adversarial approach is used
in court and in arbitration. Mediation is very suitable in these
situations as allows the parties to put forward their aside of
the dispute in a non-confrontational manner.
James Seymour is an associate member of the Chartered
Institute of Arbitrators (ACIArb) and can be contacted:
