“The future of Arbitration is bright, but only because the future of litigation is not” was mellifluously enunciated by an octogenarian lawyer, Mr. Fali S. Nariman, in his recent speech at a seminar conducted by ICADR (The International Centre for Alternative Dispute Resolution ) on “Ethics in Arbitration”.

Law encourages the parties to resolve and settle their disputes amicably by mutual concessions of a neutral third party which can certainly be allowed by various mechanisms of ADR (Alternative Dispute Resolution). Gone are those days, when arbitration and mediation were rarely used to settle the disputes as an alternative to trials. In the recent years, Arbitration has exploded onto the scene and has become imperative for the resolution of the various types of legal disputes such as commercial/business litigation, employment disputes, motor vehicle negligence etc.

In fact, in the near future, India is going to be an international hub of arbitration and an ADR centre for which the government has already constituted a ten-member high-level committee under the Chairmanship of Justice BN Srikrishna, (retired judge of the Supreme Court) to review the Institutionalisation of Arbitration Mechanism. Furthermore, the introduction of the New Delhi International Arbitration (NDIAC) Bill, 2018 in the House of the People makes it very evident that India is all set to present itself to compete internationally with other jurisdictions like Paris, New York, London, Singapore and Geneva as a global arbitration hub.

Today, dispute redressal via Arbitration and Mediation have become essential tools for all the civil litigators, not just to those entering the practise of law, but to established senior advocates as well. The aspiring lawyers would be remiss if they do not familiarise themselves with the ever-expanding world of ADR. Through Arbitration, advocates can hone their skills as it provides them with a unique opportunity to learn a variety trial experience, from opening statements, direct and cross-examination, to summations.

With a drastic increase in the number of commercial and international arbitrations, budding lawyers will become more and more involved, offering them a chance to gain the essence of the litigation experience. The young lawyers can certainly hit a home run with their great excellence and erudition in this field by working under various arbitrators both at international and domestic levels. It provides them with an experience of negotiation which would be beneficial throughout their legal career.

Lord Mustill had once adduced that “The great advantage of arbitration is that it incorporates strength with flexibility as it allows the parties to the dispute to choose the procedure which fits the nature of the dispute and the business context in which it occurs. One of the principle advantages of arbitration over litigation is commonly stated to be that, where disputes concerns a technical matter such as a building contract, the person chosen to arbitrate will normally be an expert in the subject-matter of the dispute, whereas a judge will seldom have any practical experience of the technicalities of the trade in question”[1].

Well-recognised mode of dispute resolution is through the mechanism of sovereign powers, i.e., Courts. The judicial system prevalent in Courts is regulated by procedures prescribes under various enactments which have become synonyms for technicalities, obstructions, etc. resulting into the delay. The cumbersome procedure and protracted litigation becomes extremely expensive, time and energy consuming because of which many MNCs, businessmen, top-notch companies have been preferring Arbitration over Litigation and have started including an arbitration clause in their contracts.

Promoted as a way for resolving disputes effectively and efficiently, arbitration propounds numerous advantages over litigation, trials and court hearings. Unlike in the case of Litigation, adaptability and ingress to expertise are considered to be the hallmarks of Arbitration. During the appointment of arbitrators, the anticipated subject-matter of the dispute is taken into consideration while providing the participation of experts who are either employed by the parties or appointed by the tribunal. Moreover, Arbitration is one of the most essential alternative dispute redressal processes which must be highly encouraged due to its cost-effectiveness, speedy and less formalistic remedial attributes which is faintly witnessed in litigation. It has to be looked up with all the earnestness so that the litigants have faith in the speedy process of resolving their disputes.

In other words, its main objective is to drastically curtail supervisory role of Courts, demolish various stages and procedures through which an award was required to pass through in the mechanism of old enactment so that the object of speedy resolution of dispute is achieved. It is indeed intended to ensure fair, efficient, jurisdictional neutrality, confidentiality and speedy trail while giving finality to the decision. It often provides the possibility which the parties may strike a compromise that might not be available in the court of law.

Referring to the merits of arbitration over the conventional adjudication of disputes, Desai J. observed in Ramji Dayawala & Sons (P) Ltd vs. Invest Import[2], “Protracted, exasperating, atrociously expensive and time consuming, court trials impelled an alternative mode of resolution of disputes between the parties: arbitrate and don’t litigate. Arbitration being a mode of resolution of disputes by a judge of the choice of the parties was considered preferable for adjudication of disputes by the court.”[3]

Arbitration, as opposed to Litigation, provides umpteen numbers of benefits. The purpose of arbitration is to rationalize the resolution of any civil dispute within the purview of an arbitration agreement. It enhances the speedy resolution, offers a more expedient, flexible, informal cost-efficient and private process for dispute reconciliation thereby promoting the ideal of natural justice.

Due to the aforementioned advantages, the field of Arbitration is not just attracting the young lawyers but various litigators who are increasingly switching their practice from litigation to arbitration. Nevertheless, it is considered to be an alternative of litigation or judicial adjudication and acts as a mother source of all the other alternatives not just in substance but also in the procedural working of the alternative methods. The principles and procedures have undoubtedly influenced the growth of various ancillary and hybrid processes which are used in the alternatives methods of dispute redressal.

With the ADR on the rise, one can assert that lawyers should be encouraged to gain as much exposure as they can in their legal careers. Lastly, while the caseloads increasingly create a backlog in our courts’ system, Arbitration will remain of great significance for the resolution of legal disputes. Undoubtedly, we will continue to see an immense growth of Arbitration in the coming years and will act as a mainstay in resolving legal disputes.

Note from LawSikho: If you are interested in a career in arbitration, then check out LawSikho’s Executive Certificate Course in Arbitration: Strategy, Procedure and Drafting, this is one-of-a-kind of course on successful completion of the course, you will be able to handle arbitration proceedings for your client or your business, carry our related work and be at ease with procedural and strategic aspects of arbitration. Even if you plan to become an arbitrator, doing this course will prepare you for what you are going to face ahead. The course will provide you with live sessions, feedback, coaching from trainer to help you improve the quality of the work that you produce. Most of the high performing students get a recommendation to top law firms for jobs and internships.

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[1] 1982 JBL 123, citing William H. Gill, The Law of Arbitration.

[2] AIR 1981 SC 2085,  1981 SCR (1) 899

[3] Ramji Dayawala & Sons (P) Ltd. vs. Invest Import, AIR 1981 SC 2085, 1981 SCR (1) 899