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The genesis of the arbitration law. Types of arbitration and disputes. Functions of arbitration tribunal and enforceability of award.

Other ADRs and international perspective.

Ronald Bernstein defines Arbitration as under: where two or more persons agree that a dispute between them shall be decided in a legally binding way by one or more impartial persons in a judicial manner , that is, upon evidence put before him or them , the agreement is called an arbitration agreement or a submission to arbitration. Sometimes the submission instead of being voluntary is imposed by statute . Such arbitrations are called statutory arbitrations.

Arbitration is the reference of dispute or difference between two or parties to a person chosen by the parties or appointed under statutory authority, for determination of the same. In a broad sense it is substitution of the ordinary judicial machinery by a mutually chosen tribunal i.e. an arbitrator.

Arbitration" but its literally recognized meaning is that "settlement" of differences or disputes by mutual understanding or agreement by the parties where the rights and liabilities of the parties are determined in judicial point of view which are binding to them, such settlement may be before the arbitral tribunal but not by the court of law.

The first stage in arbitration is the formulation of the arbitration agreement whereby the parties agree to submit their present or future differences to arbitration. In case of any dispute, one of the parties to the contract must file a request for Arbitration and pay the required fee to an Arbitration Institution referred to in the agreement that provides Arbitration services. Often the Arbitration Institution will suggest an arbitrator or arbitrators to which the parties must agree. The arbitrator may be an attorney, judge, or business person. After the parties have defined their dispute, there will be a hearing, often at the arbitrator's office, where the parties present evidence and witnesses in a fairly informal manner without the formal rules of evidence used in court litigation. After the evidence has been presented, the arbitrator reaches a decision and usually later sends the parties a written reasoned opinion (an award). In our country, an award passed by an arbitration tribunal has the force of a decree. Thus, it can be executed in the same manner in which a court decree can be executed.

As a concept and as a process, arbitration is well embedded in commercial practices and social life. When two persons agree to have a dispute settled through arbitration, what they really mean is that the actual resolution of the dispute will rest with a third person called the arbitrator. The essence of arbitration, therefore, is that it is the arbitrator who decides the case and not the ordinary civil courts established by the state. The Courts of law are put into a straight jacket as it has to follow fixed procedure and fixed rules of evidence. Arbitration, on the other hand, is more informal. The arbitrator need only proceed in a manner conforming to justice, equity and good conscience.

One of the major advantages of arbitration is that an expert arbitral tribunal can be selected considering the field of dispute, so much so, the entire procedure can be conducted without the intervention of expert lawyers, with major gains in speed and economy. Thus many disputes as to quality in commodity trades, many disputes arising out of construction contract etc. can be settled through arbitration in a speedy manner at lesser cost and more quickly than through courts. The popularity of arbitration as a mode of settling disputes is due to the fact that "the arbitration is regarded as speedier, more informal and cheaper than conventional judicial procedure and provides a forum more convenient to the parties who can choose the time and place for conducting arbitration and the procedure. Further, where the dispute concerns a technical matter, the parties can select an arbitrator who possesses appropriate special qualifications or skills in the trade". . To summarise, properly conducted arbitrations give acceptable results with speed and thoroughness at relatively lesser costs. As there is no right of appeal in Courts, the decision gains finality saving further time and costs.

(1) Ad-hoc Arbitration: When a dispute or difference arises between the parties in course of commercial transaction and the same could not be settled friendly by negotiation in form of conciliation or mediation, in such case ad-hoc arbitration may be sought by the conflicting parties. This arbitration is agreed to get justice for the balance of the un-settled part of the dispute only. (2) Institutional Arbitration: This kind of arbitration there is prior agreement between the parties that in case of future differences or disputes arising between the parties during their commercial transactions, such differences or disputes will be settled by arbitration as per clause provide in the agreement.

3) Statutory Arbitration: It is mandatory arbitration which is imposed on the parties by operation of law. In such a case the parties have no option as such but to abide by the law of land. It is apparent that statutory arbitration differs from the above 2 types of arbitration because (i) The consent of parties is not necessary; (ii) It is compulsory Arbitration; (iii) It is binding on the Parties as the law of land;. (4) Domestic or International Arbitration: Arbitration which occurs in India and have all the parties within India is termed as Domestic Arbitration. An Arbitration in which any party belongs to other than India and the dispute is to be settled in India is termed as International Arbitration. (5) Foreign Arbitration: When arbitration proceedings are conducted in a place outside India and the Award is required to be enforced in India, it is termed as Foreign Arbitration

Section 7: (1) In this part, arbitration agreement means an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship whether contractual or not. (2) An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement. (3) An arbitration agreement shall be in writing. (4) An arbitration agreement is in writing if it is contained in,(a)A document signed by the parties; (b)An exchange of letters , telex, telegrams or other means of telecommunication which provide a record of the agreement; or (c)An exchange of statements of claim and defence in which the existence of the agreement is alleged by one party and not denied by the other. (5)The reference in a contract to a document containing an arbitration clause constitutes an arbitration agreement if the contract is in writing and the reference is such as to make that arbitration clause part of the contract.

Arbitration Agreement: Section 7 of Arbitration & Conciliation Act, 1996 says that it means an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not. It may be in the form of a clause in a contract or in the form of a separate agreement and should be in writing. Agreement shall be considered in writing if it is contained in a document signed by the parties or an exchange of letters, telex, telegrams or other means of telecommunication which provide a record of the agreement or an exchange of statements of claim and defence in which the existence of the agreement is alleged by one party and not denied by the other.

All arbitral decisions are considered to be Final and Binding

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