KNC501/KNC601 Constitution of India, Law and Engineering
Chapter 10: Arbitration: As an alternative to resolving disputes in the normal courts
Unit 1
Unit 2
Unit 3
Unit 4
Unit 5
Appendix
Principle Characteristics and Advantages of Arbitration
Principle Characteristics of Arbitration
• Arbitration is consensual:
An arbitral proceeding can only take place if both the parties to the disputes have agreed to it. Generally, parties insert an arbitration clause in the contract for future disputes arising from non- performance of contractual obligations. An already existing dispute can also be referred to arbitration if both the parties to the dispute agree to it (submission agreement).
• Parties choose the Arbitrators:
Under the Indian Arbitration Act parties are allowed to select their arbitrator and they can also select a sole arbitrator together who will act as an umpire. However, the parties should always choose an arbitrator in an odd number.
• Arbitration is neutral:
Apart from selecting neutral persons as arbitrators, the parties can choose other important elements of proceeding such as the law applicable, language in which the proceedings should be conducted, the venue for arbitration proceedings. All these things ensure that no party enjoys a home court advantage.
• Arbitration is easy:
Decision of the Arbitral Tribunal is final and easy to enforce.
Advantages of Arbitration in India
1. Expertise in Technical matters:
An arbitrator can easily deal with technical matters which is scientific in nature because generally arbitrators are appointed based on their expertise and skill in a particular field. Thus the disputes are resolved more effectively and efficiently.
2. Cost effective and less time consuming:
The arbitral process is cost effective and less time consuming than the traditional way of dispute resolution in the court of law.
3. Convenience of the parties:
There is the convenience of the parties as they are able to decide on the language, venue and time of the proceedings.
4. Privacy and confidentiality maintained:
Privacy and confidentiality of the parties are maintained as there is no unnecessary publicity of the dispute.
5. Flexible:
Arbitral proceeding is more flexible than the court proceeding as under the arbitral proceeding one does not have to follow the strict and rigid rules and regulation as that of the court. This is due to the reason that parties set the rules and regulations of the proceedings.
