Arbitration

Arbitration is an alternative to using litigation as a method to resolve disputes. It was developed as a speedier, cheaper and less formal alternative although this is not always the case. Unlike litigation, the use of arbitration is only possible where the parties to the dispute agree to use this form of dispute resolution (known as the arbitration agreement). A contract may make provision that disputes should be resolved through arbitration rather than litigation.

Like a court judgment, an arbitration award is final and binding on the parties. Essentially, it is a private-sector alternative to litigation, for the binding resolution of disputes by an independent third party.

Arbitration is particularly appropriate for dealing with disputes of a technical nature, where the choice of the tribunal can be all-important. For this reason, it has traditionally been the main method of dispute resolution in the construction industry and for many years has been the preferred method of dispute resolution in most, if not all, of the standard forms of construction contract.

This section is maintained by Jonathan Hutt, Matt Evans and Luke Newman of Taylor Wessing LLP.

Document template: Arbitration Calderbank letter

Document template: Arbitration directions

RICS journal article: Conflict Avoidance Process helps stop disputes before they happen