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Frequently Asked Questions
- Definition - What is arbitration?
- What are the benefits of arbitration?
- What are the disadvantages?
- How does it work?
- How do I start the process?
- Who are the arbitrators?
- How much does it cost?
- How long does it take?
- What is the role of the CDB?
Definition - What is arbitration?
Arbitration is a voluntary mechanism by which parties submit their dispute to a neutral third party. It is an alternative to going to court. It should be used when the parties cannot resolve their dispute amicably.
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What are the benefits of arbitration?
Arbitration is a private matter, and issues are not made public as in the court system. The proceedings and resolution remain confidential.
The parties have a choice in the selection of arbitrators, so they can chose qualified arbitrators with experience relevant to their dispute. This is particularly important when the dispute involves highly technical issues.
The procedure is flexible in terms of time and format. There is no waiting for the matter to come before a court and the parties can agree to the procedure and to the timetable. They can be represented by people they choose.
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What are the disadvantages?
There is an issue of cost and delay common to both arbitration and litigation. In the case of arbitration, both parties must share the costs of the arbitration. This is generally considered to be offset by the speed of resolution and the other advantages referred to above.
Arbitration can become lengthy if the parties do not agree on the jurisdiction and choice of arbitrators. The CDB procedure seeks to address these issues to ensure that the parties do not delay the proceedings unfairly.
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How does it work?
Arbitration is simple. The disputing parties must only agree to use arbitration. This can be done by inserting a clause in the contract stipulating that any dispute will be subject to arbitration. This is the recommended procedure: it is always easier to agree on how to resolve disputes before a dispute arises. If this has not been done, however, the parties can agree to arbitration at any time .
Once there is a dispute, one or both of the parties can contact the CDB (forms are provided free of charge) and ask for the establishment of a Panel. The party making the request will present his claim.
The parties make their choice of arbitrators from a list provided by the CDB.
Once the parties agree to the arbitration, the respondent (the person against whom a claim is made) then presents his defense.
When the above process has been completed, the arbitrators will decide on the resolution and the timetable for that resolution. The disputing parties present their positions to the Panel. The Panel will then make its decision.
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How do I start the process?
The process starts when one of the parties presents a claim form to the CDB. This will set out the identity of the parties, the choice of arbitrator, the essence of the claim, and will include the contract and the evidence to be submitted. In order to simplify and standardize the process, the CBD will provide claim forms for initiating arbitration disputes.
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Who are the arbitrators?
The arbitrators are independent members of the public (businessmen, lawyers, former judges or former government officials) who have been selected for their experience, competence and good standing. They will be independent of the government and of the disputing parties. If there is deemed to be a conflict of interest, alternative arbitrators will be chosen by the disputing parties. If the disputing parties believe that an arbitrator is not impartial, they may seek his removal.
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How much does it cost?
The cost will depend upon the value of the claim. The more expensive the claim of the case, the higher the arbitration fees. There are two types of arbitration fees: administrative fees and arbitrator fees. Administrative fees are paid to the CDB to help cover costs such as photocopying, postage, and such. The arbitrator fees are paid directly to the arbitrators for their services rendered. Since the fee schedule is based on the value of the claim, you need not worry about the high cost of the arbitrators.
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How long does it take?
The arbitrators are independent members of the public (businessmen, lawyers, former judges or former government officials) who have been selected for their experience, competence and good standing. They will be independent of the government and of the disputing parties. If there is deemed to be a conflict of interest, alternative arbitrators will be chosen by the disputing parties. If the disputing parties believe that an arbitrator is not impartial, they may seek his removal.
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What is the role of the CDB?
The arbitrators are independent members of the public (businessmen, lawyers, former judges or former government officials) who have been selected for their experience, competence and good standing. They will be independent of the government and of the disputing parties. If there is deemed to be a conflict of interest, alternative arbitrators will be chosen by the disputing parties. If the disputing parties believe that an arbitrator is not impartial, they may seek his removal.