Definition of Arbitration
Arbitration is a procedure in which a dispute is submitted, by agreement of the parties, to one or more arbitrators who make a binding decision on the dispute. In choosing arbitration, the parties opt for a private dispute resolution procedure instead of going to court.
In the sub-continent Arbitration process is widely used. In many parts of the country, disputing matters are taken to the Panch or the Panchayet to be resolved.
Arbitration is less costly than a court trial thus people in the rural areas takes the option frequently.
Arbitration is perhaps one of the oldest methods of resolution of disputes still in common use. Arbitration begins with an agreement, made either when a contract is made, or after a dispute has arisen. When a decision is made and an award or the result is given it may be or may not be honored by the disputing parties. A valid award is given based on the arbitrator decision in respect of matters referred to him in accordance with that arbitration agreement. Should a party fail to honor the award, the other party may still seek relief from the courts.
• The Arbitrator is an independent, impartial but knowledgeable neutral, jointly appointed by the parties, who pay his fees and expenses.
• The arbitration is held in private, at a time and place that suit the parties, and the public and press are not admitted; however, some writers have suggested that this might change as various human rights statutes take effect.
• Arbitration is practiced, in one form or another, in nearly every country of the world, and frequently in the resolution of disputes between countries. Most countries have their own Arbitration Act, Ordinance or similar, and over 30 countries have adopted the UNCITRAL Model Law, promulgated by the United Nations Commission on International Trade Law in 1985