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COMMERCIAL DISPUTE RESOLUTION - Coggle Diagram
COMMERCIAL DISPUTE RESOLUTION
ALTERNATIVE DISPUTE RESOLUTION
This is a faster, cheaper and more efficient alternative to litigation
Parties must voluntarily agree to the resolution process
MEDIATION
Final decision to follow through on recommendations still up to each party
The mediation process is private with no public records kept
Parties agree on an impartial third party to evaluate the facts and make a decision
Parties still have the right to litigation if issue not satisfactorily resolved
A voluntary, non-binding mediation process
ARBITRATION
A more formalised process which results in a binding reward, which most courts can uphold
ADVANTAGES OF ARBITRATION
Parties are free to select the place of arbitration
Arbitrator is impartial and independant
Proceedings are private and not public record
Arbitration award is final with no right to appeal
International treaties support most arbitration awards
DISADVANTAGES OF ARBITRATION
The power of arbitrators is limited
Lack of transparency due to the confidentiality of the process
The technical nature of arbitrations can lead to delays and uncertain results
Loss of confidentiality if there is non compliance and the state is called in to enforce
Impossible to appeal of correct an incorrect decision
It is an expensive process
Not the ideal way to resolve disputes involving several parties
Disputes can be resolved via mediation or arbitration
AVOIDING DISPUTE
Long term business relationships are built on trust
Disputes threaten business relationships, reputations and future opportunities
A good contract is the basis for any business relationship
Hope for the best but plan for the worst
LITIGATION
This is where a case is brought before a court of law. The court must have jurisdiction to hear the matter
JURISDICTION - the power of the court to hear and decide a case. Jurisdiction covers Rem Jurisdiction (property within its geographical boundaries), Territorial Jurisdiction (crimes committed in their territory), Subject Matter Jurisdiction (certain type of legal matter), Personam Jurisdiction (individual or corporation).
SUBSTANTIVE LAW - rules by which a case is heard
PROCEDURAL LAW - differs from country to country in terms of role of the judge, collection of evidence and the appeals process etc
VENUE - geographical location of the court
FORUM NON CONVENIENS - a case should always be heard in the jurisdiction that will serve most justice
CONFLICT OF LAWS
This relates to how the court determines which country's laws to use to decide on the outcome of the case
In order to avoid conflict of law, it is best that the business contract is set up as concisely as possible, outlining for eg details like the law of place and a forum selection clause.