KINDS OF ARBITRATION
Arbitration is a way to resolve disputes between the parties outside the courts and it is an alternative method of dispute resolution. There are two types of agreements under the arbitration process. The one is the agreements which states that, if any dispute arises then, it will be settled through the means of the arbitration process and other agreements which are entered after the disputes arise which states that the parties mutually agree to settle the dispute amongst themselves through the process of arbitration. The arbitrator is the authorized person who resolves the disputes between the parties and renders the arbitration award. The decision of the arbitrator is final and legally binding on both parties. Arbitration can be classified into two types, voluntary or mandatory arbitration or binding or non-binding. Arbitration can be made compulsory only when it is mentioned in legislation or when the parties impose on each other and enter into an agreement that all the future disputes be settled through arbitration. The arbitration which is not binding is similar to the ADR mechanism that is mediation in which the decision cannot be imposed on the parties. In arbitration, there are limited rights given to parties for review and appeal of the award given by the arbitrator.
TYPES OF ARBITRATION:
- Domestic arbitration
- International arbitration
Domestic arbitration: The arbitration which happens in India and both the parties to the dispute also belongs to India and the dispute is decided concerning the substantive law of India. In this type of arbitration process, the dispute must arise in India, and parties are subjected to the Indian jurisdiction.
International arbitration: The arbitration which takes place within the territory of India or outside India or it has any element which has foreign origin is termed as international arbitration. The facts and circumstances of the disputes between the parties decide that of which origin the law should apply to the dispute.
Generally, in India the types of the arbitration process are classified into three:
- Ad hoc arbitration
- Institutional arbitration
- Fast track arbitration
Ad hoc arbitration refers to the process in which the parties mutually arrange the arbitration for the settlement of the dispute. The parties are free to submit their own set of rules and procedures as they don’t have to follow any set guidelines of any arbitration institution. The essence of the ad hoc arbitration is the geographical jurisdiction.
Institutional arbitration refers to the arbitration process which is carried out by an arbitration institution. These institutions have their own set of rules and give a framework for the arbitration to settle the dispute between the parties. It has its form of administration to assist in the process.
Fast track arbitration is the remedy to the lengthy and tedious process of arbitration. The time is the main essence of fast track arbitration. In this process, all the methods which consume time in an arbitration process have been removed and the process is made much simpler. The arbitration process is also called private process as it is not similar to the court proceedings it takes place privately.