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Arbitration and Adjudication - Essay Example

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When examining the evidence in favour of resolving disputes through arbitration - in which parties take their conflict to an impartial third party, who provides them with a resolution (Schellenberg 1996, p 196) - rather than adjudication - resolution of a dispute through the court system - both the identity of the involved parties and the scale of the dispute must be taken into account…
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Arbitration and Adjudication
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Arbitration and Adjudication

These three sets of circumstances demand specific considerations and pose their own set of problems. I would like to begin, however, by briefly outlining some important qualifications for a study of these two methods of conflict resolution.
One of the most problematic issues that arise when considering the efficacy of arbitration, as compared to adjudication, is the comparative lack of detailed information regarding the involved parties. In fact, as Walter Matti remarks, "the study of the practice of international commercial arbitration is like peering into the dark" (2001, p 919). Such cases by nature tend to be far less publicised than those settled through litigation, and indeed, many of the parties - be they individuals or companies - who seek private arbitration do so precisely because they wish to avoid the risk of having private information made public. The information used to argue either for or against the inherent superiority of arbitration cannot, therefore, be considered exhaustive.
At the same time, however, Matti points out that the popularity of arbitration, particularly as a means of resolving international disputes, has increased exponentially over the past thirty years (2001, p 920). Since it may be assumed that the number of cases settled through arbitration would not have increased were arbitration not an effective method of resolution, it can be reasonably concluded that an increasing number of parties find arbitration to be more appealing than adjudication as a means of resolving disputes. In addition, arbitration possesses an inherent degree of flexibility that is not present when going through the legal system: "Unlike judges in public courts, who must follow fixed rules of procedure and apply the laws of the land, arbitrators can dispense with legal formalities and may apply whatever procedural rules and substantive law best fit a case" (Matti 2001, p 920). On the other, this flexibility carries with it considerable risks. Since arbitrators are not bound by legal formalities, they may of course exploit this flexibility, to the unfair advantage a party that cannot appeal to a court for clarification or support (Bonn 1972, p 257). Although this risk is always present, there are nevertheless significant benefits to pursing arbitration.
In the case of arbitration as a means of conflict resolution between private individuals, the arguments in favour of arbitration appear to be quite strong. The emotional and financial demands on both the plaintiff and the defendant are considerably reduced, the overall resolution process is conducted in a less stressful environment, and decisions are often rendered more quickly. Arbitration is routinely used as a means of settling disputes between landlords and tenants, divorcing spouses, and accident victims suing for damages (Bonn 1972, p 256). In additional the arbitration process holds additional appeal because, although it is an alternative to the court system, is not entirely cut off from the it - rather, the two systems are complementary since "the provisions of an arbitrator's award can be enforced judicially under common or statutory law" (Bonn 1972, p 256). In addition, Plaintiffs therefore have the additional security of knowing ... Read More
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