Spotlight on: Arbitration

With the COVID-19 pandemic causing huge backlog in the Civil Justice System, our Dispute Resolution Team will be introducing a Spotlight series discussing different methods of Alternative Dispute Resolutions (ADR) and the benefits of utilising ADR as an alternative to Court.

Alternative Dispute Resolution (ADR) is a collective term used to describe various methods of solving legal disputes without going to Court.

One method of ADR is Arbitration. Arbitration is a procedure in which parties submit their dispute to a third party, often with specialist expertise or knowledge, who will act as a private tribunal to produce a definite and binding determination of the dispute. Arbitration is voluntary and parties in a dispute can agree to arbitrate at any point. The Arbitrator has the decision making power.

The principal of Arbitration is to resolve disputes, fairly, impartially and without unnecessary delays or expense. The process of Arbitration is flexible as it is privately funded and initiated. Due to Arbitration being within the parties’ control, the location, timing and other arrangements can be planned to suit parties’ particular needs.

Arbitration is typically used for:

The process of Arbitration is underpinned by the 2010 Act. The 2010 Act regulates the ‘external’ aspects of Arbitration. The rules are detailed within Schedule One and apply to every Arbitration seated in Scotland. The rules fall into two categories:

It is important for parties to an Arbitration Agreement to consider whether it is in their interest to apply or modify the default rules prior to concluding an agreement to arbitrate.

Arbitration is commenced by giving notice that a party intends to submit a dispute to Arbitration in accordance with the Arbitration Agreement.

The arbitration agreement itself often sets out the procedure for appointment of an arbitrator, however, if silent, parties must jointly appoint an arbitrator within 28 days of either party requesting the other to do so.

Once appointed, the Tribunal has the power to rule on its own jurisdiction with parties being entitled to raise objections. The rules provide for the Tribunal to determine the procedure to be followed in the Arbitration. The Tribunal is given wide powers to determine the format and the scope of any hearing. A Court will have limited powers to intervene in the Tribunal’s jurisdiction.

Parties are severally liable for the Arbitrators fees and expenses

An arbitral award is final and binding on the parties and can only be challenged on the basis of:

If you feel your dispute would be better dealt with by way of Arbitration, please contact our specialist team at Jones Whyte who will be able to assist you moving forward. Call 0141 375 1222 or email .