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Avoiding business disputes and alternative dispute resolution - Coggle…
Avoiding business disputes and alternative dispute resolution
Importance of avoiding disputes
TRUST
Future oportuntities
Long-term relationship=profitable
Seek out good legal counsel
"Hope for the best- plan for the worst"
Alternative Dispute Resolution
Cheaper
More efficient
Faster
*Helps avoid litigation
*Parties must voluntary submit
Mediation- Voluntary, nonbinding, conciliation process
Agree- impartial mediator
Parties- final decision
Litigation
Arbitration
Private
Arbitration-Formalized- results in binding award enforced by court
Once agree arbitration- no withdrawal
Frequent in international business
Private
Advantages
Arbitrator may be chosen
Rules of the arbitrating organisation
Permits the resolution by a third “neutral” party/country
Procedural advantages
“levels the playing field”
Cost effective
Right to appeal is limited
Disadvantages
Relaxed procedural rules
Limit rights to approach court
Discovery is limited
Selection of arbitrator
Losing party has limited right to appeal
No precedential value
Still expensive
*Look out for arbitration clause (name of chosen arbitrary body)
When alternative dispute resolution does not work
Litigation- Case bought before court suitably empowered to hear case, by parties involved for resolution.
Difference in legal systems
Substantive law
Avoid differences (Choice of law clause)
Procedural law
Issue of damages
Discovery of evidence
Right to appeal
Role of presiding officer
Trial by jury
Jurisdiction-Power of court to hear + decide case
Obtaining jurisdiction by power of process
Courts- proper service of process
Defendant- knowledge of proceedings
Key terms
In rem
Subject matter
Teritorial
In personam jurisdiction
Forum Non Conveniens- discretionary power of court to hear case
Forum selection clause- Contract states in which jurisdiction disputed heard
Cultural Attitudes
Asian- amicable settlements
American- win or lose
Difference in negotiation
Conflict of laws- rules by which courts determine which jurisdiction's law applies (generally law/ country/ jurisdiction closest relationship to transaction)
Application to contracts
Place of contract performance
Location of subject matter
Place where contract was nefgotiated
Domicile, residence, nationality, place of incorporation, place of business
Place of contracting
Application of Torts/ Delicts
Place where conduct causing injury occured
Domicile, residence, nationality, place of incorporation, place of business
Place where injury occured
Place where the relationship between the parties is centered
Commercial disputes with nations
Sovereign immunity- Protects foreign governments from suit when they are acting as political entities
*Exception- When foreign governments operate businesses with an intention of making profit, can be sued in court as corporation.
Choice of law clause
Parties stipulate country/ jurisdiction whose law will apply
Not enforceable where
Enforcement would be unreasonable and unjust
Invalid for fraud and overreaching
Referencing
Textbook
Richard Schaffer, Filiberto Agusti, Lucien Dhooge (no date) Principles of Business 1.2. Cengage.
Mind map site:
https://coggle.it/diagram/ZvO_6H7OTta-UrVa/t/avoiding-business-disputes-alternative-dispute-resolution