The decision to resolve a dispute via Commercial Arbitration is often made long before a dispute has arisen and is commonly included as a stipulation when drafting a contract. The parties to the contract agree that any commercial disputes that arise under the contract will be resolved by Commercial Arbitration. Alternatively, an arbitration agreement may be entered into after a dispute has arisen between the parties as long as the parties mutually consent.
An ‘award’ (the decision handed down at arbitration)is binding on the parties with a limited right to seek judicial review. An arbitral award is enforceable upon registration with the relevant court as a judgment of the court.
In the case of international contracts, the choice of a third party country is often also included in the contract.
Australia makes an excellent choice for International Arbitration. In particular, for disputes where one or more parties are situated in the Asia pacific region, Australia offers geographical proximity, a fair and efficient justice system and a growing number of legal practitioners experienced in international arbitration.
When is commercial arbitration the right choice?
In commercial disputes, arbitration offers an excellent alternative to the more costly option of litigation. Commercial arbitration is private, timely and more cost effective than litigation. The parties are able to exercise far greater control of the process than they would do in a court hearing. Subject to the agreement of the parties, many of the formalities of the Court system can be truncated or dispensed with.