Arbitration Expanding Opportunities for Lawyers. Jamaican Bar Association/General Legal Council Continuing Legal Education Seminar
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1 Arbitration Expanding Opportunities for Lawyers Jamaican Bar Association/General Legal Council Continuing Legal Education Seminar November 2011
2 What is Arbitration? Halsbury s Laws of England, Fourth Edition Reissue Volume 2(3) p.2 para. 1- A process used by the agreement of the parties to resolve disputes. In arbitration, disputes are resolved, with binding effect, by a person or persons acting in a judicial manner in private, rather than by a national court of law that would have jurisdiction but for the agreement of the parties to exclude it. The decision of the arbitral tribunal is usually called an award. This procedure for resolving disputes has been accepted internationally as a viable alternative to litigation. The trend worldwide has been to increase its use.
3 Arbitration Definition cont d Halsbury s Laws of England 4 th Edition, Butterworth 1991, para. 601, 332 The process by which a dispute or difference between two or more parties as to their mutual legal rights and liabilities is referred to and determined judicially and with binding effect by the application of law by one or more persons ( the arbitral tribunal) instead of by a court of law.
4 Arbitration Definition cont d David, Arbitration in International Trade, 5- Arbitration is a device whereby the settlement of a question, which is of interest for two or more persons, is entrusted to one or more persons-the arbitrator or arbitrators-who derive their powers from a private agreement, not from the authorities of a State, and who are to proceed and decide the case on the basis of such an agreement.
5 Arbitration Definition cont d Domke Commercial Arbitration : A process by which parties voluntarily refer their disputes to an impartial third person, an arbitrator, selected by them for a decision based on the evidence and arguments to be presented before the arbitration tribunal. The parties agree in advance that the arbitrator s determination, the award, will be accepted as final and binding upon them.
6 Fundamental Features of Arbitration o An alternative to National Court. o A private mechanism for dispute resolution- meaning not public except for treaty arbitration (companies or individuals and foreign government. ) o Consensual / selected and controlled by the parties. The parties have the power to shape the process. o Binding Resolution/ Final and binding determination of parties rights and obligations. This distinguishes arbitration from some other processes. Results in an award which is binding and enforceable.
7 Arbitration is not: a National Court procedure. an Expert Determination. Mediation. Negotiation, Mediation/Conciliation, Mini-trial, Executive Appraisal, Neutral Listener, early Neutral or Expert Evaluation.
8 Advantages of Arbitration Choice of Arbitrator Finality Continuity International Disputes Confidentiality Multiple Parties Flexibility Enforceability Cost Speed
9 Alternative Dispute Resolution Processes Primary Dispute Resolution Processes Adjudication Arbitration Mediation Negotiation Hybrid Dispute Resolution Processes Private Judging Neutral Expert Fact Finding Mini Trial Ombudsman Summary Jury Trial
10 Why a Preference for Litigation in Jamaica? Hugh A. Rawlins now the Chief Justice of the OEC Courts The tradition of resolving disputes by way of litigation in the courts of law rather than by arbitration is very deeply rooted in the legal culture of Caribbean countries. Gordon Robinson- Despite the usual agreement in the reference that the arbitrator s decision will be final, 99% of losing lawyers find a reason to carry the arbitrator s decision into the Supreme Court to be quashed for some technical reason. So, the parties to an arbitration do not even have the consolation of avoiding the costs, delays and inconveniences associated with litigation as litigation will follow arbitration as sure as night follows day.
11 International Arbitration The first issue for parties to a contract is to select the institution appropriate for their particular contract or dispute. This is an important decision that should be made at the outset of the contractual discussions and requires careful consideration. Every arbitration institution has its own special characteristics. It is essential that parties are aware and take account of these. It is tied in with an understanding of the special requirements of different arbitration systems and rules. For example, how many arbitrators should there be? Different rules will make different provisions; in the absence of agreement by the parties some favour one, e.g., the LCIA; others favour three, e.g. the Stockholm Institute. There are similarly differences in other areas including: The right of the parties to select, nominate and appoint arbitrators The degree of independence and neutrality required of arbitrators The power of arbitrators to control the proceedings and in particular to: To make orders concerning interim relief How the costs of the arbitration, especially the arbitrator s fees, are calculated.
12 International Arbitration Cont d Important differences also include the level of administration of the institution. For example, the ICC is heavily administered with the terms of reference, fixing of times for the making of the award and scrutiny procedures being fundamental to the system. By contrast, after the appointment of the tribunal, the LCIA limits its administration to dealing with challenges to the arbitrators and to interceding to agree, collect and pay the fees of the arbitrators. There are many international arbitration institutions. For a comprehensive collection/or list of the major arbitration institutions see A distinction can be made between arbitration institutions created by private law means and those established by an instrument of public international law.
13 International Arbitration Institutions Public Institutions Industry Focus and Commodity Private Institutions
14 Private Institutions International Chamber of Commerce, International Court of Arbitration (ICC) London Court of International Arbitration (LCIA) American Arbitration Association (AAA) Arbitration Institute of the Stockholm Chamber of Commerce China International Economic Trade Arbitration Commission (CIETAC) Hong Kong International Arbitration Centre (HKIAC) Singapore International Arbitration Centre (SIAC) Cairo Regional Centre for International Commercial Arbitration World Intellectual Property Organization Arbitration and Mediation Centre
15 Public Institutions Permanent Court of Arbitration (PCA) UNCITRAL RULES International Centre for Settlement of Investment Disputes (ICSID)
16 Industry Focus and Commodity Grain and Feed Trade Association ( GAFTA) Refined Sugar Association (RSA) Federation of Oils, Seeds and Fats Association (FOSFA) London Metal Exchange (LME) London Maritime Arbitration Association (LMAA) The Association of Food Distribution, Inc., of New York
17 The Way Forward Modernization of Arbitration Statute Sensitization Teaching Arbitration as a Core Subject Training Arbitrators Strong Judicial Policy Establishment of Special Court Membership to International Tribunals Developing Arbitration Centres
18 Domestic Arbitration An arbitration between nationals of the same country, which takes place in that country. Will generally involve only the law of the country in which it takes place. It is that law which will usually govern the matters in dispute, the conduct of the arbitration and if necessary, the enforcement of the award by a court of law. There are few mandatory requirements in national arbitration laws. E.g. Schedule 1 English Arbitration Act provides that 25 of the 110 provisions in the Act are mandatory and cannot be excluded or avoided by the parties in arbitrations which have their seat in England. Most arbitration laws are permissive allowing the parties a wide degree of discretion in deciding how their arbitration should be organised and conducted. The selection, intentional or inadvertent, of a particular arbitration system will demonstrate the parties intention and will generally be respected.
19 Domestic Arbitration Cont d Ultimately, just as the decision to submit disputes to arbitration is based on the parties choice, so too the applicable rules will be determined according to the wishes of the parties. Where there are complications and uncertainties, these should be resolved by national courts and arbitrators in accordance with international arbitration practice, as illustrated and recorded in the international arbitration instruments, including the NYC, the UNCITRAL Rules and the Model Law. The overriding factors must be the importance of the will of the parties and the absolute essential to achieve an effective and enforceable arbitration award.
20 The New Draft Legislation Overview Weaknesses The debate between the Model Law and the UK Arbitration Act 1996 How should we model our new legislation
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