Arbitration is a worthwhile option to be borne in mind and a welcome alternative to the traditional court system when signing a commercial contract. This is especially true in Australia and for companies that the new to the country and unaware of the legal system. Since the passing of the Arbitration Act in 1988, many companies and private individuals turn arbitration into a more efficient way of resolving conflicts. The law itself is in line with the Spanish constitution, allowing for freedom of choice to ensure that both parties’ interests are respected. The following are several points to be considered when deciding whether or not to include such an option in your business arrangements in Australia.
Currently, there are quite several different arbitration institutions in Australia. Many of them specialize in a particular area (for example, employment, consumer, maritime issues, etc.). It should be borne in mind however that not all issues can be resolved through arbitration. Generally speaking they are related to a commercial agreement in which both parties are allowed to make known as “free dispositions”. One area in particular where arbitration is used quite often is in the field of franchising. For those who do adopt arbitration as a way of resolving conflicts, the main advantages are:
1. Speed- most disputes are settled within a few months
2. Savings- as the process is quicker the related legal costs are lower for both parties.
3. Confidentiality- the arbitration process itself is carried out by private institutions that do not publish the individual cases’ results.
4. Expertise- the arbitrators themselves are, generally speaking, experts in the particular field of concern.
5. Control- arbitration allows for the parties themselves to control the proceedings to a greater degree than otherwise. For example, they can choose which arbitrator they use. They can also decide on the language and the national law to be applied.
When a conflict does arise, the parties contact the arbitration lawyers, sending them a list of various arbitrators considered most appropriate for the particular case. The parties themselves will state their preferences concerning the list. If they cannot agree on an arbitrator, the arbitration institution will choose the arbitrators with the greatest preference rating. After that, a date is fixed for the hearing itself, giving each party sufficient time to prepare their defence. Finally, on hearing both parties’ defence, the arbitrator will decide that it will be legal and binding for all purposes.
When it comes to matters of the law, the utmost skill and attention will need to be paid to the particulars of any case, especially those that involve disputes of any nature. Often, issues of this degree can be addressed through arbitration rather than going through the arguably more difficult and tedious litigation process. At its core, arbitration is an alternative process to dispute resolution conducted outside of the courtroom. It serves as a less time consuming and more cost effective means to settling a legal issue that those which would be employed if the matter were taken to court.