International Commercial Arbitration - Assignment Example

Critical analysis of Arbitration Disputes are common as long as a relationship exists either between individuals but more so between business entities. Many associates and associations in the business world collide often and ways in which they can solve these disputes is through a court process or through arbitration. Arbitration refers a situating whereby two parties involved in a dispute agree instead going through a court process; they each propose a team of neutral members who oversees the process of reconciliation (Noussia 8). Arbitration is an alternative mode of resolving rows that may erupt between persons, between them and organization and between organizations with other organizations. There are tones of organizations turning to the arbitration processes whereby majority are avoiding courts and preferring to solve disputes through an arbitrator. Preference of this method of solving legal disputes has left numerous concerns as to whether all these parties are all for it. This is the basis for the choice for the articles below on arbitration, in order to evaluate the process keenly to eliminate any uncertainties pertaining to it as well as provide a scrutiny of what the legal system requires to do so as to enforce arbitration processes and close loop holes that are manifesting in the mechanism and utilize it properly since despite many encumbrances facing it, it is a cost effective procedure that can be very popular among contracting parties. “Forced Arbitration: Corporations Opting Out of Justice and Fairness” and “Delaware Rapid Arbitration Act to Take Effect in May 2015” are two articles of my choice that will help me scrutinize the process of arbitration and the reasons why organizations are preferring this method of dispute resolution. The scrutiny of these articles will enable me understand arbitration especially that which touches on business organizations and its ability to provide justice to the aggrieved parties. This study will also help identify strengths and areas of improvement in the process in the legal system concerning Arbitration. “Forced Arbitration: Corporations Opting Out of Justice and Fairness” article contends that the contractual agreements giving permission to allow arbitration as a means of resolving conflicts. This contractual agreement is present in many businesses and individuals sign without the knowledge that they have embedded their signature to permit such a process. This is the reason why the article calls the process as a forced arbitration because majority of participant are unaware of them. There is even an example where a consumer who has claims against the wholesaler unwillingly has to undergo the arbitration process because unknowingly in their agreement an arbitration clause was present. Holding that each party has the right to select their own arbitrators, the wholesaler sets their own rules as to the right way to follow to acquire justice thus manipulating the whole process thus the consumer does not get the proper justice (Gibb). The article further claims that the reason why there are so many arbitrations is that many parties do not read the details of their contractual agreement. They attribute this trend to the fact that these documents are too long or the language does not motivate the parties at all. They claim that specifically corporate parties use arbitration to avoid proper justice and fairness by evading court processes. However, many parties are challenging this trend in court where court cases reverse the arbitration clauses. This follows the courts ability to scrutinize the validity of the arbitration agreement and whether the parties had prior knowledge of it (Moses 94) “Delaware Rapid Arbitration Act to Take Effect in May 2015” is an article as the name suggests shines spotlight to an Act whose purpose is to solve conflicts between businesses who agrees to it. The Delaware governor recently signed the Act into law with unanimous support from both the senate and the house members. The content of the Act dictates that the parties must both agree to the Act. The Act applies in Delaware only and at least one of the parties must be a business from Delaware and the consumers are not part of the Act. The Act clearly lays out the rules regarding to arbitration starting with the selection of one or more arbitrators, which should be the left for the parties to select. Another section of this Act dictates the timelines for the arbitrator to give verdict, which should be within four months after the commencement of the arbitration process. The third section gives any party the go ahead to appeal the verdict of the arbitrator within the Delaware’s courts. The main intention for the huge support for this bill was the intention to attract more business and investors to the county. This would be owing to the profound conflict resolution structure between businesses. The move also seemed as a way of creating a fair system for justice between businesses without any manipulations (National Law Review). The first article outlines the legal complications that surround the arbitration process in terms of chances of manipulation. The unfairness that less powerful parties like the consumers encounter are beyond imagination since they cannot match up to the influence of big corporations. The employees in such corporations also come under similar attacks using the arbitration agreement such that an employee cannot sue since there is an arbitration clause. This article plays a significant role in ensuring that the legal organs identify the areas of weakness and opportunities to enhance cohesiveness in business operations. The second article outlines the importance of arbitration in ensuring harmonious relationship between businesses. The effectiveness of the act will ensure that minor conflict which can be resolved out of the court thus unburdening the courts. This article is paramount because it acts as guidelines where even businesses outside Delaware can learn from in terms of conflict resolution. The success of the Act will guide the legal systems to benchmark their own process and where there are shortcomings, make the necessary alignments. From the articles, we are also able to gather some of the benefits of using the arbitration in comparison to other methods of conflict resolution. The confidentiality levels in an arbitration process are high and the privacy of the process is a guarantee. Arbitration laws differ with the nation, which undertakes the principle but regardless of that, there are concepts that always remain unchanged. According to Brunett (50), the laws concerning arbitration are only subject to the state in which it is taking place. For instance, the arbitration laws in America must adhere to the treaties of the nation. These laws are comparative to the guidelines set in Delaware on arbitration, which are also subject to laws governing that county and must not conflict. Arbitration has been in use for quite a long time especially in businesses as method of resolving conflict and even international laws of arbitration are in place to promote better international conflict resolution mechanisms in trade. This has happened through the international chamber of commerce (ICC) who has been at the forefront to promote this method (Morrissey, Graves and Bersten 22). The ICC has even set up an International Court Of Arbitration which has been in operation since the 1920s. Interview To completely, affirm arbitration process, its shortcomings and the areas of improvements, I conducted an interview with one lecturer with great proficiency in matters of business law. Before the interview, I explained that article was all about the arbitration clauses that many corporations are embedding in almost their contractual agreement. These arbitration agreements are always present in these contracts without the knowledge with other party. I also explain the content of the arbitration act in Delaware due to take effect in May 2015. The interview was about present similar cases of forced arbitration agreements and the way out. The interview also entailed the discussion about the Delaware Rapid Arbitration act, which many agreed to. The lecturer concurred with first article that many companies are using hidden arbitration clauses to avoid liability. This he explained was not in order since many employees bind themselves to agreements whose terms they do not comprehend and thus end up suffering unfair consequences when such terms become enforced. As regards to arbitration, he insisted that this is one area where many employees are downplayed by their employers when they conclude agreements with them, without total disclosure of their terms of association ingrained in the contractual forms. This is happening especially to employees’ contract by their companies thus they can sue these organizations in case of disputes. The interview analysis of the Delaware act of arbitration and he asserted that it was a good Act and if it succeeds in its implementation, then this would instill confidence in the business community on the ability to resolve conflicts. The Act’s success also will act as a reference point in other arbitration courts in determination of various cases. From the interview it is paramount that every person read their contract and understands them and if they cannot, they should seek assistance from a professional for explanations. In conclusion, it is clear that the Key points from these two articles are the injustices that arbitration can bring due to lack of proper regulations. The articles also give a series of cause of actions in order to manouevre these injustices. Similarly especially from the second article, the major principles for an arbitration process to take place get pin-pointed and the article outlines that if any party is not satisfied with the verdict of the arbitrator, he is free to seek further legal redress. The Delaware Rapid Arbitration Act serves as a clear guideline so that the two parties are aware what the arbitration process entails and their rights as well. There should be proper follow ups made to ensure that employers make known arbitration clauses ingrained in their contracts. This will ensure that the employees are not met by shock when they discover that they are bound to terms on arbitration that they never got to read and comprehend before getting into agreement may be because of the length of the documents or non disclosure by the employer concerning such terms. Such follow up is very crucial for the legal system to be up to standard in its arbitration processes. References Gibb, Gordon. “Lawyers and Settlement.com”. Forced Arbitration: Corporations Opting Out of Justice and Fairness., 17 Oct 2014. Web. 24 April. 2015 Morrissey, Joseph. F., Graves, Jack.M. and Bersten, Eric.E. International sales law and arbitration : problems, cases and commentary. Alphen: Kluwer law international cop. 2008. Print Moses, Margaret. L. The principles and practice of international commercial arbitration. New York: Cambridge university press. 2012. Print. E-source National Law Review. Delaware Arbitration Act to Take Effect in May 2015. 15 April 2015. Web. 24 April 2015. Noussia, Kyriaki. Confidentiality in international commercial arbitration : a comparative analysis of the position under English, US, German and French law.Berlin; New York: Springer. 2010. Print Read More