U2 AOS2 - Arbitration

Question 1

What is arbitration?

Answer 1

• Arbitration is one of the most formal alternate methods of dispute resolution outside of courts

Question 2

Who facilitates the arbitration process?

Answer 2

• Arbitrators are impartial third parties who generally have knowledge about the subject matter of the dispute and expertise in the relevant law

Question 3

How does arbitration work?

Answer 3

• The arbitrator listens to both parties and makes a legally binding and enforceable decision called an arbitral award
• Arbitration is not bound by strict rules of evidence. Parties can agree on how evidence is presented, the level of formality and what procedural rules will apply
• Parties can self-represent, however, most parties will have legal representation considering the binding nature of the award

Question 4

When is arbitration used?

Answer 4

• Privately. Parties previously agree (in contract) that disputes will be settled via arbitration. Parties hire an arbitrator and agree in advance to abide by the award. It could occur at the Dispute Resolution Centre or the Melbourne Commercial Mediation and Arbitration Centre
• Courts. The Magistrates Court use arbitration to resolve claims of less than $10,000. The court initially attempts to facilitate an agreement between the parties, but a magistrate or registrar can step in to make a binding decision if this is unsuccessful
  
  • The Magistrates County and Supreme Court can also request parties attend arbitration for claims above $10,000 if they consent
• Tribunals. Victorian Civil Administrative Tribunal (VCAT) can refer parties to arbitration before the final hearing, however, does not conduct the arbitration process itself