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Resolution of commercial disputes - Coggle Diagram
Resolution of commercial disputes
Avoidance of disputes or Alternative Dispute Resolution
Avoidance
Long term relationships in busienss are the most profitable
Trust is critical to building long term relationlships
A sound contract is ciritcal in resolving disputes and providing each party with calrity regarding their obligations
Need to understand the cultural context in which you are doing business
Mediation
Formal dispute resolution process
Parties must voluntarily submit to the process
Parties agree to an impartial mediator
Final decision rests with teh parties - non-binding
No public records - process is private
Arbitration
More formalised than mediation but cheaper and faster than litigation
Decision is binding on the parties
Advantages
Less expensive than litigating
Resolution by a neutral third party chosed by the parties
Saves time - right of appeal is limited
Formalised process with rules due to arbitrating organisations
Most nations recognise and accept arbitration processes (New York convention)
Disadvantages
Still expensive
Limited right to discovery and appeal
Limited rights to approach courts
Will not take precedence into account
Litigation
Definition: Defined as a case which is brought before a court (having the jurisdiction) to hear the case, by the parties involved for resolution
Procedural and substantive law differs between countries, thus jurisdiction is a critical issue
Types of Jurisdiction
In Rem
Jurisdiction by virtue of an issue occuring within its territory or borders
In Personam Jursidiction
Jurisdiction over the person or corporation
Subject matter jurisdiction
Specific courts have jurisdiction of specific cases
Courts can only obtain Jurisdiction by proper service of process
Forum non-conveniens
Refers to the principle that the case must be heard by the court where justice is most likely to be served and is the most convenient
Discretionary power of a court to hear a case
Contract should specify the forum under which a dispute, if it arises will be heard, to avoid "forum shopping"
Conflict of Laws
Refers to the rules by which courts determine which jurisdictions law applies to a particular case
Debate over jurisdiction can be dealt with upfront by including a "choice of law clause" in the contract
Enforcement of foreign judgements
Can prove challenging in some cases
Generally enforced on the basis of reciprocity between nations