KINDS OF ARBITRATION

Depending on the terms of arbitration agreement, the subject matter of the dispute in
arbitration, and the laws governing such arbitrations, rbitrations can be classified into different
types, such as

Ad-hoc Arbitration: The Ad-hoc Arbitration is agreed to and arranged by the parties
themselves without recourse to an arbitral institution. It is to get the justice, in the balance of
the un-settled part of their dispute only. It may be either International or Domestic arbitration

Domestic arbitration: The Domestic arbitration means, an arbitration which takes place in
India, wherein parties are Indians and the dispute is decided in

International Arbitration: An Arbitration, which may take place either within India or outside
India but, where there are ingredients of foreign origin in relation to the parties, or the subject
matter of the dispute. In this process, the dispute is decided in accordance with substantive
law in India or any other country, depending on the contract in this regard and the rules of
conflict of laws are termed as International Arbitration.

Institutional Arbitration: It means, an arbitration conducted by an arbitral institution in

accordance with the prescribed rules of the institution. In such kind of arbitration, there is prior
agreement between the parties that in case of future differences or disputes arising between
the parties during their commercial transactions, such differences or disputes will be settled
by arbitration as per clause provide in the agreement and in accordance with the rules of that
particular arbitral institution. The arbitrator or arbitrators, as the case may be is appointed from
the panel maintained by the institution either by disputants or by the governing body of the
institution. The Arbitration and Conciliation Act, 1996 gives recognition and effect to the
agreement of the parties to arbitrate according to institutional rules and subject to institutional
supervision. Some of the leading Indian institutions providing for institutional arbitration are,
The Indian Council of Arbitration (ICA), New Delhi, The Federation of Indian Chamber of
Commerce and Industries (FICCI), New Delhi and The International Center for Alternative
Dispute Resolution (ICADA). Some of the leading international institutions are The
International Chamber of Commerce (ICC), Paris, The London Court of International
Arbitration (LCIA), London and The American Arbitration Association (AAA). The World
Intellectual Property Organisation (WIPO) is an agency of the United Nations, which is offering
its services exclusively for the intellectual property disputes. WIPO is based in Geneva.

Statutory Arbitration: It is mandatory form of arbitration, which is imposed on the parties by

operation of law. It is conducted in accordance with the provisions of an enactment, which
specifically provides for arbitration in respect of disputes arising on matters covered by the
concerned enactment byelaws or Rules made there under having the force of law. In such a
case, the parties have no option as such but to abide by the law of land. It is apparent that
statutory arbitration differs from the other types of arbitration for the reason that, the consent
of parties is not necessary, it is compulsory form Arbitration and it is binding on the Parties as
the law of land. As an example to it, Sections 24, 31 and 32 of the Defence of India Act, 1971
and Section 43(c) of The Indian Trusts Act, 1882 are the statutory provision, which deals with
statutory arbitration.

Foreign Arbitration: When arbitration proceedings are conducted in a place outside India
and the Award is required to be enforced in India, it is termed as Foreign Arbitration.

Fast Track Arbitration or Documents Only Arbitration: The

Documents only arbitration is not oral and is based only on the claim statement and statement
of defence, and a written reply by the claimant, if any. It also includes the documents the
document submitted by the parties with their statements along with a list of reference to the
documents or other evidences submitted by them. The written submission may take the form
of a letter to the tribunal from the party or his representative, or may be a more formal
document produced by lawyers. The parties may agree upon, or in default, the tribunal may
adopt the procedure to resolve the dispute only on the basis of the documents submitted to
the tribunal and without any oral hearing or cross-examination of the witnesses.

Look –Sniff Arbitration: Institutions specialised in special types of disputes have their own
special rules to meet the specific requirements for the conduct of arbitration in their specialised
areas. Look –Sniff Arbitration is a hybrid arbitration, and also known as quality arbitration. It is
a combination of the arbitral process and expert opinion. On the bases of the evidence and
inspection of goods or commodities that are subject matter of the dispute placed before the
arbitrator, who is selected based on his specialised knowledge, expertise and experience in a
particular area of trade or business, the arbitrator decides the dispute and makes his award.
The award may relate to the quality or price of the goods or both. There is no formal hearing
for taking evidence or hearing oral submissions. For example, Rules of the London Court of
International Arbitration (LCIA) permit the arbitrator, on his own, to ascertain the quality of
goods and their prevalent price.

Flip –Flop Arbitration: This type of arbitration has its origin in a United States arbitration
case, which dealt with a baseball player. In such arbitration, the parties formulate their
respective cases beforehand. They then invite the arbitrator to choose one of the two. On the
evidences adduced by the parties, the arbitrator decides which submission is the correct
submission, and then makes an award in favour of that party. After both parties have submitted
their respective cases to the arbitrator, he makes an award either favoring the claimant of the
respondent. He cannot pick and choose from a party’s case. If a party inflates its claim, then
it is possible that it will everything. This type of arbitration is also known as ‘pendulum
arbitration’.

International Commercial Arbitration: Section 2(1)(f) of the Arbitration and Conciliation

Act,1996 defines an 'International Commercial Arbitration' as the one in which at least one of
the parties is a resident of a country other than India, or a body corporate incorporated in any
country other than India, or a company or association or a body of individuals whose central
management and control is exercised in any country other than India. Arbitration with the
government of a foreign country is also considered to be an international commercial
arbitration.

Thus, the above classifications of the process under different heads reflects that, the process
of arbitration is flexible enough so that, it can be altered and modified according to the dispute
to its best form, by the disputed parties. Thus, it is a fact that the above classification is not
exhaustive. The best method or the form of arbitration is to be chosen by the parties according
to their requirement, which can help them fulfill the objective of an amicable resolution of the
dispute for the betterment of all.