LAB GROUP ASSIGNMENT

On

ARBITRATION

Submitted To- Submitted By-

Dr. Amit Bagga Mansi ChoudharyNihit Sinha

Saurabh Sharma Komal Bakshi

Nishikant SinghRahul Arora

Arbitration

A form of alternative dispute resolution (ADR) is a technique for the resolution of

disputes outside the courts. The parties to a dispute refer it to arbitration by one or

more persons “arbitrators“and agree to be bound by the arbitration decision. A

third party reviews the evidence in the case and imposes a decision that is legally

binding on both sides and enforceable in the courts.

The arbitrator does not enjoy any judicial powers. The arbitrator listens to the view

points of the conflicting parties and then gives his decision which is binding on all

the parties. The judgment on the dispute is sent to the government. The

government publishes the judgment within 30 days of its submission and the same

becomes enforceable after 30 days of its publication. In India, there are two types

of arbitration: Voluntary and Compulsory.

Arbitration can be either voluntary or mandatory (although mandatory arbitration

can only come from a statute or from a contract that is voluntarily entered into,

where the parties agree to hold all existing or future disputes to arbitration, without

necessarily knowing, specifically, what disputes will ever occur) and can be either

binding or non-binding. Non-binding arbitration is similar to mediation in that a

decision cannot be imposed on the parties. However, the principal distinction is

that whereas a mediator will try to help the parties find a middle ground on which

to compromise, the (non-binding) arbitrator remains totally removed from the

settlement process and will only give a determination of liability and, if

appropriate, an indication of the quantum of damages payable. By one definition

arbitration is binding and so non-binding arbitration is technically not arbitration.

Compulsory Arbitration

Compulsory arbitration is an arbitration required or forced by law on parties

involved in a dispute. In such arbitration, the parties are compelled to submit their

case for arbitration even if they do not will to do so. It is a non-binding, adversarial

dispute resolution process in which one or more arbitrators hear arguments, weigh

evidence and issue a non-binding judgment on the merits after an expedited

hearing. In such arbitration, arbitrators address only the disputed legal issues and

apply legal standards. Either party can reject the ruling and request a trial de novo

in court.

a. Under compulsory arbitration the parties are forced to arbitration by the state

when:

b. The parties fail to arrive at a settlement by a voluntary method.

c. Public interest and the working conditions have to be safeguarded and regulated

by the state.

d. When there is a national emergency which requires that the wheels of

production should not be obstructed by frequent work-stoppages.The nation is

facing a grave economic crisis.

e. There is a grave public dissatisfaction with the existing industrial relations.

Compulsory arbitration eliminates the scope for strikes and lock-outs. It deprives

both the parties of their very important and fundamental rights.

Voluntary Arbitration

Voluntary Arbitration is arbitration by the agreement of parties. It is a binding

adversarial dispute resolution process in which the disputing parties choose one or

more arbitrators to hear their dispute and to render a final decision or award after

an expedited hearing.

Some of the important elements in voluntary arbitration are:

a. Voluntary submission of dispute to an arbitrator.

b. Subsequent attendance of witnesses and investigations.

Voluntary arbitration may be specifically needed for disputes arising under

agreements.

Appointment of Arbitrator

Arbitral tribunals are usually constituted (appointed) in two types of proceedings:

ad hoc arbitration proceedings are those in which the arbitrators are appointed

by the parties without a supervising institution, relying instead on the

procedural law and courts of the place of arbitration to resolve any differences

over the appointment, replacement, or authority of any or all of the arbitrators;

and

institutional arbitration proceedings are those in which the arbitrators are

appointed under the supervision of professional bodies providing arbitration

services, such as the American Arbitration Association (which conducts

international proceedings through its New York-based division, the ICDR),

the LCIA in London or the ICC in Paris. Although these institutions (and many

others) are headquartered in their respective cities, they are capable of

supervising the appointment of arbitral tribunals in nearly any country,

avoiding the need for the parties to involve local courts and procedures in the

event of disagreement over the appointment, replacement, or authority of any or

all of the arbitrators.

Permanent tribunals tend to have their own rules and procedures, and tend to be

much more formal. They also tend to be more expensive, and, for procedural

reasons, slower.

Examples

Example 1: A kid ends up breaking his neighbor's window with a baseball. The

neighbor wants compensation but doesn't want the kid to end up in criminal

trouble. They go to an arbiter it is decided that the kid will mow the neighbor’s

lawn once a week at a rate of $10 per week until the window is paid off.

Example 2: Workers of Bob's Marketplace feel like they don't get enough benefits.

The union gets in touch with the management of Bob's and the management agree

to arbitration instead of risking a long strike. In arbitration it is decided that if an

employee works more than 30 hours/week they are entitled to a better health care

package.

Case on Arbitration

A North-American software developer had registered a trademark for

communication software in the United States and Canada. A manufacturer of

computer hardware based elsewhere registered an almost identical mark for

computer hardware in a number of Asian countries. Both parties had been

engaged in legal proceedings in various jurisdictions concerning the registration

and use of their marks. Each party had effectively prevented the other from

registering or using its mark in the jurisdictions in which it holds prior rights. In

order to facilitate the use and registration of their respective marks worldwide,

the parties entered into a coexistence agreement which contains a WIPO

arbitration clause. When the North-American company tried to register its

trademark in a particular Asian country, the application was refused because of a

risk of confusion with the prior mark held by the other party. The North-

American company requested that the other party undertake any efforts to

enable it to register its mark in that Asian country and, when the other party

refused, initiated arbitration proceedings.

Following proposals made by the Center, the parties appointed a leading IP

lawyer as sole arbitrator. In an interim award the sole arbitrator gave effect to

the consensual solution suggested by the parties, which provided for the granting

by the hardware manufacturer of a license on appropriate terms to the North-

American company, including an obligation to provide periodic reports to the

other party.

Conciliation

The terms conciliation and mediation are interchangeable in the Indian context.

Conciliation is a voluntary process whereby the conciliator, a trained and qualified

neutral, facilitates negotiations between disputing parties and assists them in

understanding their conflicts at issue and their interests in order to arrive at a

mutually acceptable agreement. Conciliation involves discussions among the

parties and the conciliator with an aim to explore sustainable and equitable

resolutions by targeting the existent issues involved in the dispute and creating

options for a settlement that are acceptable to all parties. The conciliator does not

decide for the parties, but strives to support them in generating options in order to

find a solution that is compatible to both parties. The process is risk free and not

binding on the parties till they arrive at and sign the agreement. Once a solution is

reached between the disputing parties before a conciliator, the agreement had the

effect of an arbitration award and is legally tenable in any court in the country.

Most commercial disputes, in which it is not essential that there should be a

binding and enforceable decision, are amenable to conciliation. Conciliation may

be particularly suitable where the parties in dispute wish to safeguard and maintain

their commercial relationships.

The following types of disputes are usually conducive for mediation: commercial,

financial, family, real estate, employment, intellectual property, insolvency,

insurance, service, partnerships, environmental and product liability. Apart from

commercial transactions, the mechanism of Conciliation is also adopted for settling

various types of disputes such as labour disputes, service matters, antitrust matters,

consumer protection, taxation, excise etc

Appointment of conciliators

Section 64 deals with the appointment of the conciliators. When the invitation to

the conciliation is accepted by the other party, the parties have to agree on the

composition of the conciliation tribunal. In the absence of any agreement to the

contrary, there shall be only one conciliator. The conciliation proceeding may be

conducted by a sole conciliator to be appointed with the concent of both the

parties, failing to which the same may be conducted by two conciliators (maximum

limit is three), then each party appoints own conciliator ,and the third conciliator is

appointed unanimously by both the parties. The third conciliator so appointed shall

be the presiding conciliator. The parties to the arbitration agreement instead of

appointing the conciliator themselves may enlist the assistance of an institution or

person of their choice for appointment of conciliators. But the institution or the

person should keep in view during appointment that, the conciliator is independent

and impartial.

Procedure of conciliation

1) Commencement of the conciliation proceedings

The conciliation proceeding are initiated by one party sending a written invitation

to the other party to conciliate. The invitation should identify the subject of the

dispute. Conciliation proceedings are commenced when the other party accepts the

invitation to conciliate in writing. If the other party rejects the invitation, there will

be no conciliation proceedings. If the party inviting conciliation does not receive a

reply within thirty days of the date he sends the invitation or within such period of

time as is specified in the invitation, he may elect to treat this as rejection of the

invitation to conciliate. If he so elects he should inform the other party in writing

accordingly.

2) Submission of Statement to Conciliator [Section 65] –

The conciliator may request each party to submit to him a brief written statement.

The statement should describe the general nature of the dispute and the points at

issue. Each party should send a copy of such statement to the other party. The

conciliator may require each party to submit to hima further written statement of

his position and the facts and grounds in its support. It may be supplemented by

appropriate documents and evidence. The party should send the copy of such

statements, documents and evidence to the other party. At any stage of the

conciliation proceedings, the conciliator may request a party to submit to him any

additional information which he may deem appropriate.

3) Conduct of Conciliation Proceedings [Section 69(1), 67(3)]-

The conciliator may invite the parties to meet him. He may communicate with the

parties orally or in writing. He may meet or communicate with the parties together

or separately. In the conduct of the conciliation proceedings, the conciliator has

some freedom. He may conduct them in such manner as he may consider

appropriate. But he should take in account the circumstances of the case, the

express wishes of the parties, a party’s request to beheard orally and the need of

speedy settlement of the dispute.

4) Administrative assistance [S. 68]-

Section 68 facilitates administrative assistance for the conduct of conciliation

proceedings. Accordingly, the parties and the conciliator may seek administrative

assistance by a suitable institution or the person with the consent of the parties.

Role of   conciliator

(1) The conciliator shall assist the parties in an independent and impartial manner

in their attempt to reach an amicable settlement of their dispute.

(2) The conciliator shall be guided by principles of objectivity, fairness and justice,

giving consideration to, among other things, the rights and obligations of the

parties, the usages of the trade concerned and the circumstances surrounding the

dispute, including any previous business practices between the parties.

(3) The conciliator may conduct the conciliation proceedings in such a manner as

he considers appropriate, taking into account the circumstances of the case, the

wishes the parties may express, including any request by a party that the

conciliator hear oral statements, and the need for a speedy settlement of the

dispute.

(4) The conciliator may, at any stage of the conciliation proceedings, make

proposals for a settlement of the dispute. Such proposals need not be in writing and

need not be accompanied by a statement of the masons therefore.

Case on Consillation

Improved and integrated care for aged patients

The complainant’s elderly mother, a resident of North West Tasmania, was

admitted to hospital suffering from confusion and a urinary infection. The

complainant contended that her mother was inappropriately prescribed the anti-

psychotic drugs Haloperidol and Risperidone whilst in hospital, and that this

caused her condition to worsen and her behaviour to deteriorate to the extent that

she was subjected to physical as well as chemical restraint. She complained that

hospital staff failed to listen to her concerns about the effects of the medication on

her mother.

The patient was eventually transferred to a specialist psycho-geriatric unit in the

south of the State, where her debilitating symptoms were attributed to neuroleptic-

induced Parkinsonianism. Psychotropic medication was ceased at this stage, and

she was eventually discharged home.

The hospital acknowledged the agitation and suffering of the patient and the fact

that delirium is invariably more severe in a hospital environment than at home. It

was noted that there was no alternative placement available, and that the hospital

had provided a high standard of care in difficult circumstances. The hospital

asserted that it had consulted regularly with the complainant about the care of her

mother.

In conciliation, a report was obtained from a senior specialist in aged care. The

specialist advised that the patient’s condition was probably contributed to by some

of the medications used to try to manage the patient’s behaviour, and that her

outcome would have been better, and her hospitalisation probably shorter, had she

been treated in a specialist unit from the outset, rather than in a general hospital

environment. The specialist commented that the best management of delirium is in

a specialised delirium ward, which no acute Tasmanian hospital possesses. A

higher staff-to-patient ratio could provide an environment in which patients are

safe to roam without chemical or physical restraint. It was noted that the hospital in

this complaint lacks backup from specialised geriatric or psycho-geriatric services.

As a result of the complaint, it was recommended that the systemic problems

identified in the expert report, particularly the lack of a specialist unit or ward in

the north west of the State be addressed, and that education programs for

practitioners involved in the management of dementia patients be introduced.

The hospital responded by holding a planning day involving all stakeholders, to

address the issues raised in the report with a view to providing improved and

integrated care for aged patients. The key initiatives from the planning

day have now been published, and introduced into the hospital’s strategic plan. A

major outcome has been the identification of a hospital precinct specifically suited

to the needs of patients with dementia or delirium.

Conciliation vs Arbitration

Conciliation and arbitration are both carried out with the purpose of peacefully and

agreeably resolving the conflict between parties. They are both processes that have

been adopted to avoid the hassle and cost involved in going to courts to resolve a

dispute. Despite their similarities in the outcome that they try to achieve, a number

of major differences between the two are there. In conciliation, most if not all

communication goes through the conciliator who is trusted by both parties. In

arbitration, a panel of arbitrators hears the cases of both parties and examines

evidence to come at a resolution. While the decision given by the conciliator is not

binding, with room for negotiation, the decision put forth by arbitrators are final

and legally binding thereby leaving little room for appeal.

Difference between Conciliation and Arbitration

• Alternative dispute resolution (ADR) is a dispute resolution technique used to

resolve disagreements and disputes between parties by coming to an agreeable

settlement through discussion and negotiation. Conciliation and arbitration are two

such forms of ADR that are used as an alternative to going to courts to resolve

conflicts.

• The conciliation process is handled by an impartial individual known as a

conciliator, who meets with the parties involved and works with the parties

involved to arrive at a settlement or resolution.

• Arbitration is much like a mini court in which the parties need to present their

case to a panel of arbitrators, along with supporting evidence.

Adjudication

Adjudication is the legal process by which an arbiter or judge reviews evidence

and argumentation including legal reasoning set forth by opposing parties or

litigants to come to a decision which determines rights and obligations between the

parties involved.  Three types of disputes are resolved through adjudication:

1. Disputes between private parties, such as individuals or corporations.

2. Disputes between private parties and public officials.

3. Disputes between public officials or public bodies.

The ultimate legal remedy for the settlement of an unresolved dispute is its

reference to adjudication by the government. The government can refer the dispute

to adjudication with or without the consent of the disputing parties.

When the dispute is referred to adjudication with the consent of the disputing

parties, it is called ‘voluntary adjudication.’ When the government herself refers

the dispute to adjudication without consulting the concerned parties, it is known as

‘compulsory adjudication.’