Arbitration and Mediation: a Preferred Mode for Corporate Dispute Resolution

Corporate, accustomed to our highly litigious culture, generally consider litigation (where backlog of cases is still growing) as the main method for resolving disputes. Moreover, the speed of change in strong national and emerging global markets puts increasing pressure on corporate to resolve disputes quickly, inexpensively, amicably, constructively and creatively, in order to maximize long term interests and to maintain ongoing commercial relationships. In any dispute, if taken to court of law, it not only involves lot of time in settlement, but also trade secrets get leaked out. Business transactions take place between companies of different countries. If a lawsuit is filed in one of the countries, then the question arises as to which law would apply and also whether the domestic court of that country has jurisdiction to settle the dispute. Again, these difficulties of litigation often influence parties to provide for mediation or arbitration of a commercial dispute. An advantage of arbitration and mediation is that its scope is limited only by the creativity of the parties. There is no limit on the nature of the agreement. The parties are free to decide the place they want their dispute to be settled at. A neutral venue could be chosen such that no one is subjected to the local prejudices of judges and jurors in faraway places. Experts can be chosen who will attempt to bring a dispassionate, impartial view to any dispute. However, lately Corporate have been rejecting arbitration and mediation as they have become complicated. It is important to recognize that associations do charge fees for the entire process. Then again, it is a moot point between ADR and litigation for the corporates