Is Climate Seeing a Rise in Popularity of Arbitration? Paul Bennett of Grant Thornton's Forensic and Investigation Services Team Looks at the Trends in Arbitration as a Form of Alternative Dispute Resolution (ADR)

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Byline: Paul Bennett

In an increasingly global business environment, there are many who believe that the use of arbitration can only increase.

Certainly, most contracts drawn up between parties in different jurisdictions include arbitration clauses as a matter of course. Whether those clauses are as a result of pro-active legal advice, or simply boiler-plate clauses inserted without thought for implications when disputes arise, is difficult to determine.

Confidentiality is seen by many businesses as a key advantage of arbitration over litigation. As reputation management is well-recognised as a vital weapon in an organisation's competitive armoury, this factor could be a more positive driver towards arbitration in future.

There is also a feeling amongst many in the legal fraternity that taking dispute resolution out of the court arena allows the parties involved to have a greater control of both the process and timeframe.

For example, the parties have an opportunity to agree certain procedural issues impacting on how the matter progresses, the venue for hearings, and the background and experience of the arbitrators involved.

But has arbitration had its day before it has begun? Some practitioners believe that the reason for the growth in arbitration is because it is, rightly or wrongly, seen as a cheaper alternative to litigation.

Yet there is increasing comment from many external dispute resolution lawyers, both in the press and anecdotally, that, based on their experience, arbitration is generally neither quicker nor cheaper than traditional litigation, and this is certainly our experience. …