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Three Key Points About a Request for Arbitration for a Commercial Dispute

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As a business owner, you will engage in many commercial activities to make your business successful. However, not all business transactions will go smoothly, and sometimes commercial disputes can arise. Where this occurs, it is essential for the disputing parties to amicably and quickly resolve them. There are different ways to resolve commercial disputes, such as court proceedings. Another way to do so is through an arbitration following arbitration proceedings and rules. This article will explain three key points about a request for arbitration for your commercial dispute.

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What is Arbitration?

Arbitration is a confidential form of alternative dispute resolution (ADR) for resolving a commercial dispute outside the courtroom. It is a formal process, contract-based, and has formal arbitration rules and procedures.

An expert arbitrator or panel will try to resolve the dispute and make a binding decision, known as the arbitral award.

What Key Points Do I Need to Know About a Request for Arbitration for a Commercial Dispute?

If you and the other company you carry out business activity with choose arbitration to resolve any potential commercial dispute, you will first need to make a request for arbitration. Below are key points to consider.

1. What is a Request for Arbitration?

When you request arbitration for your commercial dispute, you start the arbitration process. 

Your commercial contract may specify some exact steps you need to take, such as a ‘request for arbitration’ or ‘notice to arbitrate’. 

If your arbitration clause details a particular centre of arbitration, such as the ICC or LCIA, you must issue the request in the specified centre. 

2. What Do I Include in a Request for Arbitration?

When you request an arbitration or give notice to arbitrate, there is specific information you need to include in the document. These include:

  • brief details of the issue the arbitration is about; and
  • who will you choose to be the arbitrator if your contract says that it is your role to do so.

Issues could involve different areas and could be, for example;

  • factual issues;
  • legal issues; or
  • issues about the quantum of the case.

3. Does a Request Require a Response?

When you issue a request for arbitration or notice to arbitrate or when you receive one, a response is required. This will usually be within a specific time frame, and depending on the arbitration clause, you may need to refer to the arbitration centre rules if a specific centre has been chosen.

Moreover, the respondent may be able to state who they wish to arbitrate with.

Additionally, the response should also state whether the relevant procedures and rules have been followed and raise an objection, if appropriate.  

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Key Takeaways

If you fall into a dispute, you may choose arbitration as an alternative dispute resolution (ADR) method. It is a form of dispute resolution which results in a binding decision. In the request to arbitrate, it must state the legal basis for the dispute. There will be a timeframe to submit the response, which may be detailed in your contract. In the response, you may wish to object if you feel the request did not follow specific procedures. 

If you need help understanding a request for arbitration, our experienced disputes and litigation solicitors can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. So call us today on 0808 196 8584 or visit our membership page.

Frequently Asked Questions

What is an alternative dispute resolution?

Alternative dispute resolution is a cost-effective and efficient alternative to litigation. It includes methods such as Early Neutral Evaluation (ENE), mediation, and negotiation.

What happens after a request for arbitration?

After a request is submitted, the process progresses to the selection of an arbitrator or arbitration panel. The other party will have a specified timeframe to submit a response.

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Clare Farmer

Clare Farmer

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