Arbitration is nothing new. It is, however, an underutilised tool to resolve disputes in the personal injury world and could be one, post reform, that is used more often, particularly for Litigants in Person (LiPs).
Currently, when entering into an agreement, the parties can choose to submit any disputes that may arise to arbitration. Arbitration differs from litigation in the following ways:
- Arbitration is a consensual process such that all parties to the arbitration proceedings must have agreed to submit the dispute in question to arbitration.
- The procedural rules that apply are chosen by the parties.
- The proceedings are usually confidential in nature.
Decisions on the merits are final and are not subject to appeal (although in certain limited circumstances the court of the seat of the arbitration can set aside the award).
The starting point for me about suitability of arbitration is that, actually, all individuals have the right to a fair trial. They can have their civil disputes resolved within the civil justice system (although this is not a swift process as it is subject to having an efficient court system which we don’t have). If you force people to use arbitration you will potentially undermine trust in the legal system, especially if you force them out of the system on the grounds of saving costs. Each party should have the right to allow the court to resolve the dispute. This is a basic human right.
That being said, arbitration could be a viable alternative to court proceedings for personal injury lawyers and could sit within the process quite comfortably. However, the lay clients may take a little convincing, as often those that feel they have been wronged want to have their day in court. The courts can be less flexible and at times can interfere and take points that have already been agreed between the parties. Experts could miss court imposed deadlines for crucial evidence. There is no such risk with arbitration. The parties agree on what issues they want resolved.
Arbitration, therefore, could give the parties control in the process. If mistakes are made, there are no real sanctions and it is likely that the process will be much quicker than the court process. It seems more suited for LiGs. It’s probably fair to say it is cheaper too (especially if the hearings are completed on paper, rather than oral). Court fees are excessive these days and the costs of a tribunal would be much less. Judges in court are not always personal injury specialists either. They have to cover a broad spectrum. A tribunal could be heard by personal injury specialists which makes sense.
If Alternative Dispute Resolution (ADR) was to be considered as a mandatory procedural step within the court system (or within the CNF process when a claim has been disputed) we could effectively introduce the arbitration stage. Who knows, Claimants might like it? If the matter cannot be resolved, at least then the parties could report to the court on the outcome of the ADR, disclosing what has been agreed and with reasons as to what has not been agreed, as well as presenting all the evidence they seek to rely on at trial. A Judge could then set a realistic timetable for trial and the matter progresses. Lawyers already have a duty to advise their clients to consider ADR. Perhaps the next step should be taken to make it mandatory as the current court system cannot cope and successfully concluded arbitration hearings will reduce the burden on the courts.
Peter Adlard, author of “Arbitration post reform – one to think about”, is Head of Legal Operations at Hebble Law in Liverpool. He is also Regional Co-ordinator for Merseyside and The Wirral.