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More people are relying on arbitration each day, as it is being advertised as the better alternative for litigation, wether we agree with this notion or not, the fact that the number of arbitral proceedings is increasing is proven and known in the legal-commercial field.
In this article, the writer will try to shed the light on some of the aspects and factors that different parties shall evaluate before considering refering to arbitration.
Arbitration could take a longer – than expected- time:
Arbitration is supposed to consume less time when compared to litigation, however,there is more than one -loopwhole- that parties could use to delay the arbitration proceedings, the first starts with the arbitrators selecting, a process and in the case of a three-arbitrators panel could take months, another aspect is the flexibility within the arbitration proceedings ,that can be misused by the parties, especially if the arbitration agreement allows it, the act of parties lengthening the proceedings by calling extensive fact witnesses and experts has been common recently, hence, parties must evaluate the evidences in their case before proceeding to arbitration especially the number of fact witnesses, the years of dispute and the avilabality of data.
Arbitrators, how many? and how?:
A single arbitrator may be the best solution if cost and time are significant considerations. However, if the dispute is complicated and needs multidimensional knowledge, a three-arbitrator panel may be preferable. A panel of three certainly allows for a more vigorous debate than a single arbitrator. The arbitration provision should, ideally, explain how and when such decision-makers will be chosen, as well as the requisite credentials.
The procedure for appointing an arbitrator is frequently outlined in the arbitration clause, Qualifications are often specified by both parties or worked out in pre-arbitration discussions.
Parties shall Consider the selection of arbitrators to include industry expertise and abilities in a dispute-resolution context. Any arbitrator should also have significant expertise handling complicated cases as it is known that arbitration may be a difficult process.
selecting a panel of arbitrators can result in many delays owing to schedule problems, which rarely occurs when a single arbitrator is in charge, all of which adds to the time and money necessary to complete the proceeding,moreover ,arbitrators are not bound by the same rules of evidence as judges in civil courts and may be willing to accept practically any evidence or testimony that the parties deem significant. In complicated disputes, this may require lengthy hearings for both fact and expert witnesses, as well as many expert reports, reply reports, and sur-rebuttal findings, all of which could cost hundreds of thousands of dollars, lastly, it is essential for the parties and before entering the arbitration proceedings to agree on the legal fees and all the other costs in order to get the full picture before starting the whole arbitration process.
The Arbitral Award:
The judgment of an arbitrator is generally final, with limited appealing rights in many jurisdictions. That inevitability is most frequently questioned in situations when the arbitrator denies or refuses to hear significant evidence that one party claims should have been permitted, Because of the possibility of an appeal on such grounds, many arbitrators offer the parties a lot more flexibility in presenting their claims,Experts may be allowed to cover more area than under stringent evidence standards in a court environment,moreover , Privacy and finality may be interconnected concerns, both parties may be driven to an arbitral setting in order to guarantee completeness and privacy, not only about the final decision , but also over their own corporate practices, information, and other evidence that may encourage unwanted attention from a variety of other parties – the press, competitors and regulatory authorities.
Arbitration offers key advantages over litigation, but it needs a high level of forethought and planning to be successful. T the less you detail in the original arbitration clause, the more power you give over the processes and the more probably you will meet unforeseen problems, or at minimum a route on which you can’t control.
Author: Mr. Mohammad Mufid Ratib Qurashi