Meaning of Arbitration

motor inns ar over bounded with a large build of typesetters cases and their disposal collects big clip. in that adorefore a need was matt-up for a faster scrap resoluteness mechanism. Thats why arbitrement locomote was provided with a view to give trifleive justice to the people and besides to rid of unnecessary appendress case expenses. It is an light strife firmness mechanism. Bangladesh has upstartly enacted a pertly arbitrament honor, write bug outn as The arbitrement Act, 2001. The Act came into force on April 10, 2001.The Act has repealed The arbitrement (Protocol and Convention) Act, 1937 and The arbitrement Act, 1940. With this sweet enactment Bangladesh has kept pace with the recent tr displaces in the field of planetary arbitrement in the rest of the world. According to the musical theme of this assignment, I overly agree that although arbitrament was introduced for specialisetling battle except it is non serving it part tout e nsemble and precisely. practiced away Im going to handle almost the fences which ar making bar for arbitrament to swear out its purpose completely. essence of arbitrementBefore discussing close to the in utilenesss of arbitration, first we should briefly know what arbitrement very means. The word arbitration means mediation, negotiation, adjudication etc. This means closing of arguments, disparity, and clash betwixt two parties. It is a subprogram in which a disagreement between two or much parties is obstinate by impartial several(prenominal)s, c altoge in that respectd referees, in arrange to avoid hailly and long courtroom case or wake little actions. arbitrement is the most traditional rule of affray colony. Arbitration is a fertilisation procedure.It is lots administered by a orphic organization that maintains lists of avail able justices and provides rules to a lower place which the arbitration provide be conducted. Such organizations fag als o manage the arbitration in whole or in part. Parties often select supreme authoritys on the basis of substantial expertise. Arbitration is adjudicatory, as opposed to advisory, because of the event that the arbitrator ( ordinarily a retired articulate or attorney) renders a finish at the end of an arbitration hearing, and that decision is final and binding, survey all to a very express mail court review.Arbitration is sometimes referred to as non-binding if the parties agree to pull ahead it so, but that is re wholey a misnomer. Think of arbitration as a binding, adjudicatory bear upon. Arbitration is a process of resolving a dispute or a grievance external a court system by inserting it for decision to a neutral triad caller. Both sides in the dispute usually essential agree in call forth to the choice of arbitrator and certify that they will agree to the arbitrators decision. The Arbitration procedures differ from the procedures of courts, curiously presentation of evidence.Arbitration avoids costly judicial proceeding and offers a relatively speedy firmness of purpose as intumesce as solitude for the disputants. The main disadvantage is that setting guidelines is surd on that pointfore the outcome is often little(prenominal) predictable than a court decision. The reasons for selecting Arbitration rather than Court * Speedier resolution however, in that respect enkindle be exceptions due to fivefold parties, arbitrators, lawyers and litigation strategy. * Less costly however, thither can be exceptions due to nonuple parties, lawyers, arbitrators and litigation strategy. Not a cosmos hearing in that respect is no usual record of the proceedings. Confidentiality is required of the arbitrator and by agreement the whole dispute and the resolution of it can be unresolved to confidentiality oblige on the parties, their experts and attorneys by so providing in the arbitration agreement.* From defense point of view, there is less ex posure to punitive indemnification and run away juries. * Limited stripping because it is controlled by what the parties have agreed upon and it is all controlled by the arbitrator. Often, the arbitration process is less adversarial than litigation which helps to maintain business relationships between the parties. * The arbitration is much informal than litigation. * The conclusiveness of the arbitration award and the fact that ordinarily there is no right of hail to the courts to change the award. So after the intelligence we can say that, arbitration is a dispute resolution processes in which the disputing parties present their case to a third party intermediary (or a panel of arbitrators) that get a line all the evidence and thusly make a decision for the parties.This decision is usually binding. Like court-based adjudication, arbitration is adversarial. The presentations atomic number 18 do to prove hotshot side right, the early(a) wrong. Thus the parties assume th ey ar work against each other, non cooperatively. Arbitration is largely non as formal as court adjudication, however, and the rules can be change to some extent to meet the parties needs. wherefore arbitration as dispute extermination mechanism is non effective direct lets discuss the close to the chapters of arbitration which are making Arbitration less effective.Although settling dispute with arbitration is one of the most traditionally approved to methods for resolving disputes between individuals and parties, there are some lacking. Some disputes whitethorn non prove best resolved through arbitration either. Arbitration, itself, is a process of two parties mutually agreeing to allow a third, impartial party make a decision regarding an outstanding dispute. The decisions from an arbitrator are legally binding, and are enforceable in the court of law per the Arbitration Act, as well as numerous realm and topical anesthetic laws following the federal legislation.Unl ess in cases of corruption, fraud, or other circumstances that would instill an arbitrators big businessman to stick around neutral, almost all arbitration rulings are final. Additionally, the courts whitethorn rule against the decision and rulings of an arbitrator if the decision is against one party without basis. Arbitration also leaves no room for an appeals process in the vast majority of instances. This is a risk parties and individuals should seriously assess prior(prenominal) to engaging in arbitration, as well as when considering the methods for resolving their disputes.Following are some limitation which makes arbitration less effective * There is no right of appeal even if the arbitrator makes a mistake of fact or law. However, there are some limitations on that rule, the adopt limitations are difficult to define, except in general terms, and are fact driven. * There is no right of discovery unless the arbitration agreement so provides or the parties specify to al low discovery or the arbitrator permits discovery. * The arbitration process whitethorn non be fast and it may not be inexpensive, particularly when there is a panel of arbitrators. An arbitration award cannot be the basis of a claim for vixenish prosecution. * Except in certain circumstances, non-signatories of the arbitration agreement cannot be compelled to arbitrate.* The large cost of legal fees in litigating a dispute. * The index of parties to appeal to a higher court after losing at the trial court level and the lack of finality. * The fact that incomplete the control panel or the judge may not have both friendship nor experience with the subject matter of the dispute between the parties which results in the parties having to educate the judge as to the law and custom and practice. The ability to appeal to higher court ill rulings on procedural. * Unknown bias and capacity of the arbitrator unless the arbitration agreement set up the qualifications or the organizati on that administers the arbitration, has pre-qualified the arbitrator. Also, in the arbitration process, there is a check period of discovery, which can lead to force evidence or testimony occurring during an arbitration process, which a party may or may not be able to effectively refute at the time of their arbitration hearing.Likewise, there is no jury to decide the outcome of a dispute, but rather, the decision rests solely in the custody of the arbitrators, whom usually consist of one individual or a panel of tether persons, that may or may not be able to remain entirely impartial during all proceedings regarding all matters. Why Arbitration Act 2001 is not fully serving according to its purpose? Arbitration in Bangladesh is governed by the Arbitration Act 2001. This Act repealed both(prenominal) the Arbitration (Protocol and Convention) Act 1937 and the Arbitration Act of 1940 and consolidates the home(prenominal) and exotic arbitration regime in Bangladesh.In mid-2004 , the Bangladesh Council of Arbitration (BCA) was established as an arbitral body. The BCA rules have not that been finalized. Arbitration in Bangladesh is governed by the Arbitration Act 2001. This is based on the UNCITRAL assume law. Here are some reason for which Arbitration Act 2001 is failing to serve the purpose for which it was enacted * There are difficulties in enforcing arbitration awards in Bangladesh. The difficulty is great if it is a foreign party seek to enforce an award against a local party.Where the arbitration is convened abroad, there have been instances where the East Pakistani courts have allowed legal proceedings which interfered with the issues brocaded in the foreign arbitration. The Act provides that an world(prenominal) arbitral award can be enforced as if it were a mandate of the domestic court. * Arbitration varies on the subject matters that mean weather parties will go for arbitration or not it depends on the context of arbitration contract. Tha t contract has to be a written contract. Moreover, only those disputes on which parties has agreed previously will be considered as arbitration context.So, if someone wishs to add another context which is far more important as well cant do it as it was not mentioned earlier. * In case of cost it also may be huge sometimes. Although it is considered that parties goes for arbitration for lowering the cost of court case still some arbitrator may ask for big amount of silver from the parties. So fee of the arbitrator is both expensive and inexpensive. As for the parties who does not want to give huge amount of notes faces difficulties for going for arbitration.Generally, costs are not awarded to the winning party, although there is no law preventing the judicature from doing so. * Thus, according to the new Bangladesh Act, a party to outside(a)istic commercial message arbitration has to qualify as (i) an individual who is a national of, or habitually nonmigratory in, any soil other than Bangladesh (ii) A body corporate which is incorporated in any country other than Bangladesh (iii) A company or an association or a body of individuals whose central commission and control is exercised in any country other than Bangladesh or (iv) The government of a foreign country.This means that a commercial dispute between two Bangladeshi nationals having places of business even in variant States cannot be considered the subject matter of international commercial arbitration under the new Act, which would be otherwise possible under the Model Law * In division 3 of Arbitration Act 2001, it says that this act will be only utilize if the place of arbitration is in Bangladesh. * The Arbitration Act does not make grooming for confidentiality in arbitration proceedings. If this is important to the parties then this should be dealt with in the arbitration clause.They are bound to maintain confidentiality. But they begettert maintain it properly. * There are no available institutional rules specialized to Bangladesh. Parties are free to agree on the rules to govern the arbitration. In the absence of an agreement, and where the rules selected by the parties do not cover a particular circumstance, the Act sets certain nonremittal rules. * beneath the Act, no judicial pronouncement (including the courts) is allowed to hear any legal proceedings commenced by any of the parties to an arbitration agreement. However, slit 7A of the Act contains an exception to this general rule.Under section 7A, the High Court constituent, before or during arbitration may, inter alia, take interim protective measures in respect of goods or property included in arbitration agreement. * Under the Act, the only cubic yard for contend are if (i) circumstances constitute that give rise to justifiable doubts as to their independence and impartiality (ii) The arbitrator does not possess the qualifications agreed by the parties. Where international commercial arbitration is concerned, a challenge against an arbitrator essential first be made to the arbitral tribunal.An appeal against the decision of the tribunal goes to the High Court Division of the Supreme Court. The procedure for challenge may be modified by agreement. * As in court-based adjudication, arbitration outcomes are typically win-lose, not win-win. Thus, the arbitrator usually decides that one side was right and the other wrong. They do not often go out of their way to develop new approaches for run across the interests of both sides simultaneously, as a intermediator would do, though if a win-win solution is apparent, the arbitrator would probably recommend it.Conclusion and testimony The prior examination of the new Bangladesh Act, 2001 from a comparative perspective shows that the Bangladesh legal regime has embraced the fundamental tenets of modernization of international arbitration such as (i) party self-direction (ii) minimal judicial intervention in arbitration (iii) inde pendence of the arbitral tribunal (iv) fair, expeditious and economical resolution of disputes and (v) effective enforcement of arbitral awards. This modernization has also been brought about in the context of domestic arbitration.As the new Act is now about ten years old, it will be more mature to express any judgment on its efficacy as an arbitral legal regime and the clash it will have in the approaching for Bangladesh as a place for dependency of international commercial and investment disputes by arbitration. Certainly, Bangladesh, being a prospective coating for increasing foreign investment in the future, has made a positive feeling in the right direction by enacting the new law on arbitration. No doubt, there is still room for cash advance in the Act itself as indicated above.It must be appreciated that in order to make Bangladesh an attractive place for much-needed foreign investment, for economic growth and phylogenesis, and for choice dispute resolution. Bangladesh needs more than a absolute piece of legislation on arbitration at the present time. The Government and the judiciary, as well as the legal profession, must take initiatives and make constant efforts towards the development of legal infrastructure and institution building in the field of alternative dispute resolution, including arbitration.In this respect the following dubious suggestions may be worth considering * When construe the new Act Bangladesh courts should not be detracted from the spirit of modernization of arbitration as a global phenomenon. * The members of the judiciary as well as the legal profession must appreciate the reality that in this era of globalization dispute settlement by alternative methods is not only a domestic matter, but also an increasingly growing international phenomenon in the context of cross-border transactions.They have to be make to absorbing international values, norms and principles while execute their professional functions in the fie ld of international dispute settlement. * The need to create a specialist arbitration remove in the High Court Division may arise for the purpose of dealing with international arbitration matters more effectively and professionally. * specialist bench may be accomplished by appointing a certain number of judges in the High Court Division with the appropriate expertise and basis in the field of arbitration. The Government, the Bar and the judiciary must attend to the development of the civilization of arbitration in Bangladesh. Judges and lawyers must be aware of the value of alternative dispute resolution when the courts are intemperately overburdened with caseloads. They must actively bring up arbitration. * The Government and professional organizations should promote arbitration and ADR and enhance the understanding of them by sponsoring and conducting educational and training programs for both the bar and the bench and for arbitration.