Specialists in Dispute Resolution

Arbitration

What is Arbitration?

Arbitration is a form of alternative dispute resolution which is actively encouraged by the courts throughout the litigation process. Parties may favour arbitration because it offers the opportunity to resolve disputes in private and allows flexibility, such as in the appointment and use of experts. Moreover, decisions of arbitrators are binding, which increases certainty, and outcomes are often far more practical than those achieved by the courts. There are, however, few grounds for challenge for parties unhappy with an arbitrator’s decision.

How does Arbitration work?

Commonly arbitration will involve the appointment of an independent third party who will bring an end to the parties’ dispute by making a binding decision as to its correct outcome based on the evidence brought before him. The arbitrator must act fairly and impartially and give all parties reasonable opportunity to be heard. The remedies ordered by an arbitrator include a declaration as to any matter to be determined, an order for payment or specific performance, or even an award for punitive or exemplary damages.

Arbitration may be conducted under rules set out by the parties and/or their appointed arbitrator(s), or may be conducted under the auspices of one of the arbitral institutions such as the International Chamber of Commerce. The rules adopted will become the arbitration agreement which confers powers on the arbitrator(s), subject to certain mandatory provisions of the Arbitration Act 1996.

What is the role of an Arbitrator and how do I choose one?

An arbitrator’s role is not dissimilar to a judge’s in so far as they are a neutral person whose final judgement is considered legally binding, yet an arbitrator resolves disputes outside the courts and is most likely to be a subject matter expert in their own right. An arbitrator will come to an informed, carefully considered decision upon hearing all the evidence presented by each party at a hearing, drawing on their legal and professional knowledge.

When choosing an arbitrator they key factors are ensuring independence and impartiality, and that the arbitrator has the relevant legal knowledge and professional expertise. The right arbitrator with the necessary experience can help parties reach a speedy and successful outcome in dispute resolution.

Why Expert Evidence?

With a wealth of experience in the UK and internationally, at Expert Evidence we are able to provide both expert witnesses to provide evidence to an arbitrator and are able to provide a fully accredited and experienced arbitrator to act for you in your dispute. Successful arbitrations include those in the construction industry.

At Expert Evidence we are able to provide both expert witnesses to provide evidence to an arbitrator and are able to provide a fully accredited arbitrator to act for you in your dispute. Successful arbitrations include those in the construction industry.

Choosing the right arbitrator is one of the most consequential decisions in the process, since the entire proceeding and its outcome rest in their hands. The law requires arbitrators to be both impartial and independent, but imposes no restrictions on who can serve in the role, meaning an arbitrator does not need formal legal training. Where a dispute involves a specific industry, parties often prioritise appointing someone with sector experience who can understand the technical context without needing it explained. Practical experience managing arbitrations is just as important as subject-matter knowledge: Section 33 of the Arbitration Act 1996 requires the arbitrator to adopt procedures suited to the case and to avoid unnecessary delay or expense, and a poorly managed arbitration can become protracted and costly. Candidates are typically found through word of mouth, institutional directories, or formal selection processes through arbitral bodies. Parties may also have some influence over the selection even where an institution nominates the arbitrator.

Read the full article: How to Choose an Arbitrator

Arbitration has significant advantages over formal litigation in most commercial disputes, but it is not right for every situation. The finality of an arbitrator’s decision is one of the most important limitations to understand: because awards are rarely reviewed by the courts, a party who considers the outcome unfair has very limited options for redress. Some argue that the private nature of proceedings, while usually advantageous, can in certain commercial cases shield misconduct from those with a legitimate interest in knowing about it. Costs can also escalate if one party acts in bad faith to delay proceedings, since an uncooperative party can disrupt the process more easily than they could in court. A phenomenon called “process paranoia” has also been identified, where arbitrators extend deadlines and admit late evidence repeatedly to insulate themselves from challenge, which undermines the speed and cost advantage that makes arbitration attractive. Finally, some types of dispute simply cannot be referred to arbitration at all, including criminal cases, divorce, and matters governed by planning law.

Read the full article: When to Avoid Arbitration

 

Interim measures are protective steps taken during, or sometimes even before, formal arbitration proceedings in order to preserve a party’s rights pending the final outcome. Common types include injunctions (preventing a party from disposing of assets or taking other specified actions); security for costs (where there is reasonable concern that the claimant would be unable to pay if the arbitration went against them); preservation or inspection of property; active measures requiring a party to continue performing contractual obligations; and passive measures establishing procedural guidelines for how the arbitration will be conducted. Historically, the power to grant interim measures was reserved to national courts, but today many jurisdictions including England and Wales allow arbitrators and courts to exercise concurrent jurisdiction to grant relief. Under the Arbitration Act 1996, one of the governing principles is to minimise the need for court intervention, so tribunals have the power to issue partial awards on an interim basis that are binding pending the final resolution.

Read the full article: Kinds of Interim Measures in Arbitration

 

Evidence is central to arbitration proceedings, and arbitrators generally have broad discretion over what they will admit. Both direct evidence (the original document itself) and indirect evidence (copies, or testimony about a document’s contents) are recognised, though direct evidence is preferred and typically given more weight. Hearsay evidence is generally admissible in civil proceedings under the Civil Evidence Act 1995. Even relevant documents may be excluded if their authenticity has not been established. While the use of documents has grown significantly in arbitration and is generally seen as a positive development, broad document requests can slow proceedings and mount costs, which runs counter to one of arbitration’s core advantages over litigation. Arbitrators therefore have to balance the value of the evidence against the burden of producing it, and the LCIA rules give them wide authority to decide the admissibility, relevance, and weighting of material put before them.

Read the full article: Documentary Evidence in Arbitration

 

An arbitrator is an independent and impartial third party who reviews all the evidence put before them, including witness statements, testimony and documentation, applies the relevant laws and rules, and makes a final decision, known as an “award,” that is binding on both parties. Unlike a judge, an arbitrator is chosen by the disputing parties rather than appointed by the state, and is often selected specifically for their expertise in the relevant industry or field. Before formal proceedings begin, an arbitrator will typically encourage collaborative communication between the parties in an attempt to reach a settlement. During proceedings, they act as a referee, facilitating discussion, managing the process, and ensuring both parties have a fair and equal opportunity to be heard. Section 33 of the Arbitration Act 1996 requires the arbitrator to act fairly and impartially at all times and to adopt procedures that avoid unnecessary delay or expense. If at any point an arbitrator cannot remain impartial, they must withdraw from the case.

Read the full article: Role of the Arbitrator

Testimony is a form of evidence given by a witness under oath, consisting of factual statements about the events and circumstances relating to the dispute. An expert witness may give opinion as part of their testimony, but that opinion must remain grounded in their area of expertise and based on fact rather than advocacy. Argument, by contrast, is a logical structure designed to persuade the arbitrator toward a particular conclusion, using evidence and reasoning as its foundation. Both have a legitimate role in arbitration proceedings, but understanding when each is appropriate matters. An expert witness who strays from providing opinions on the facts and instead begins to argue the case for the instructing party risks undermining their credibility and the weight of their evidence in the arbitrator’s eyes.

Read the full article: The Difference between Argument and Testimony in Arbitration

Arbitration places obligations on both the arbitrator and the disputing parties. The arbitrator must remain entirely impartial throughout and must withdraw if they cannot, must disclose any prior connections to either party, and is bound by confidentiality. English law imposes a duty of confidentiality on all participants, including the arbitrator and the tribunal, even without this being explicitly agreed. The disputing parties must engage honestly with the process, comply with disclosure obligations and process agreements, and understand the terms of the arbitration before proceedings begin. The typical arbitration follows a structured sequence: the arbitration clause or agreement; statement of claims; statement of counterclaims; discovery; hearing; and award. Because the award is generally binding and difficult to appeal, it is important that all parties are fully clear on the scope and terms of the process before it starts.

Read the full article: The Obligations of Arbitration

The arbitrator’s decision is called an “award” and carries the same legal force as a court judgment. Awards are not limited to the payment of damages: an arbitrator can also issue injunctions, order specific performance of a contract, or direct the rectification or cancellation of a deed. Several distinct award types exist. An interim award is a temporary measure until the tribunal’s final decision. A partial award resolves some issues while others remain to be determined. A consent award records a settlement agreed between the parties and makes it enforceable. A performance award requires a party to carry out specified works or hand over goods or rights, though monetary awards are generally preferred to avoid further disputes. A final award brings the proceedings to a close and must normally be in writing, signed, reasoned and dated. An additional award addresses any issues inadvertently omitted from the final award. Final awards are also enforceable internationally under the New York Convention 1958.

Read the full article: The Types of Award in Arbitration

Discovery is the pre-hearing stage during which each party gathers and discloses the documents, information and witnesses they will rely on at the final hearing. It also allows parties to obtain relevant material held by the other side, reducing the risk of unexpected evidence emerging at the hearing itself. As arbitration cases have grown in scope and complexity, discovery disputes have become more common, with parties challenging document requests or objecting to what the other side has produced. An arbitrator can address this proactively by establishing clear ground rules at the outset, including timelines for requests and objections, and by deciding disputes quickly through email or teleconference rather than allowing them to delay proceedings. Parties can also agree the scope of discovery in the arbitration agreement itself, before the process begins. Keeping the discovery phase efficient matters because prolonged disputes here directly undermine arbitration’s core advantage of being faster and less expensive than litigation.

Read the full article: Resolution of Discovery Disputes in Arbitration

Challenges in arbitration can arise at different stages and on different grounds. An arbitrator can be challenged before or during proceedings under Section 24 of the Arbitration Act 1996 on grounds of bias, lack of the necessary qualifications, physical or mental incapacity, or failure to conduct proceedings properly. Jurisdictional challenges, which question the arbitrator’s authority to decide the dispute, must generally be raised at the outset and can be either comprehensive (challenging authority over the whole dispute) or partial. Challenges to the award itself are possible on three grounds: jurisdiction (Section 67); serious irregularity (Section 68), which covers failures of fairness, undue delay, or fraud; and a point of law (Section 69), which requires either all parties’ agreement or the court’s permission. Successful challenges are relatively rare, as courts generally uphold arbitrators’ decisions in order to maintain the integrity of arbitration as a dispute resolution method. Some challenges are made with tactical rather than genuine aims in mind.

Read the full article: Methods of Challenge in Arbitration

The main cost in arbitration is the arbitrator’s fee, which is typically charged by the hour and varies depending on their experience, the length and complexity of the case, and how many expert witnesses are involved. In addition to the arbitrator’s fees, parties should budget for procedural and administrative costs (including registration fees and tribunal costs) and their own expenses such as travel and venue hire. Party costs of this kind account for around 83% of total arbitration costs on average, with procedural fees making up the balance. The Arbitration Act 1996 provides that costs generally follow the outcome, meaning the losing party pays, though the tribunal can apportion costs differently based on how each party has conducted themselves throughout the process. Practical ways to contain costs include keeping the discovery stage focused, setting firm dates for the final award from the outset, using a single expert witness rather than a panel where the case allows, and agreeing on document admissibility before discovery begins. Despite the variables, arbitration typically remains significantly cheaper than formal litigation.

Read the full article: Arbitration Costs and Fees – What to Expect

In binding arbitration, both parties agree at the outset that the arbitrator’s decision will be final and enforceable, waiving their right to take the same dispute to a formal court hearing. The award can only be challenged in very limited circumstances such as proven fraud or a breach of public policy, and courts will generally uphold an arbitrator’s decision in order to support arbitration as a trusted alternative to litigation. In non-binding arbitration, the arbitrator still makes a decision, but neither party is bound by it: either party can reject the outcome and seek a formal court hearing instead. Non-binding arbitration is more common in the United States and Canada, and tends to be used for less complex disputes or where the parties want an impartial third-party assessment of the relative strengths of their positions while preserving the relationship and avoiding the finality of a binding decision. Arbitration clauses, which commit parties to resolving disputes through arbitration should they arise, are now found in a wide range of commercial and consumer contracts.

Read the full article: Binding and Non-Binding Arbitration – What is the Difference?