Companies

Arbitration has been around, in one form or another, for hundreds of years. The process of arbitration has been recognised and supported by the English courts since the first Arbitration Act of 1698. Arbitration is a way of resolving commercial disputes without having to go to court. The idea of arbitration was originally conceived as a distinctly non-legal method of solving apparently insoluble disputes and the arbitrators preferred and chosen were men with a commercial background. Going to court can be a lengthy process, will certainly be expensive, and takes place very publicly. It can also, as any litigant will confirm, generate considerable bad feeling between the parties. Companies or individuals who recognise the need to resolve disputes but who wish to keep their relations with their adversary as friendly as possible (often because, despite the dispute they will still have to continue in a business relationship together) can opt for the relatively more amicable process of arbitration. The formality of arbitration proceedings must not, however, be under-estimated. Although they are not as complex or as rigid as court proceedings, they do, nevertheless, retain judicial substance, since they are after all an alternative to court proceedings. Usually a contract, such as a charter party, will contain an arbitration clause. This is a clause which sets out that should a dispute arise the parties intend that it should be resolved by means of arbitration rather than by means of court proceedings. There are a number of advantages to arbitration: Flexibility in a court there are set procedures which must be followed. Parties to arbitration proceedings normally make their own rules of conduct. The parties can choose to have the formality of a High Court hearing, with leading counsel representing the parties, or they can have something entirely informal where the parties simply meet the arbitrator round a table without lawyers being present. The procedure is tailored to the requirements of the individual dispute. This can save time and money.