NAME : SHILPA M.

S
COURSE: EX PGDM
ROLL NO: 46
DATE: 05.01.2011

Conflict, Negotiation and Resolution Management

ASSIGNMENT NO. 1

Submitted to Mrs. Sangita Soman

SYMBIOSIS INSTITUTE OF MANAGEMENT STUDIES

 Arbitration
Arbitration is a technique for the resolution of disputes outside the courts, where the parties to a
dispute refer it to one or more persons (the "arbitrators", "arbiters" or "arbitral tribunal"), by whose
decision (the "award") they agree to be bound. It is a settlement technique in which a third party
reviews the case and imposes a decision that is legally binding for both sides.

Whereas Mediation is a form of settlement negotiation facilitated by a neutral third party and is a
non-binding resolution by experts.

The use of arbitration is also frequently employed in consumer and employment matters, where
arbitration may be mandated by the terms of employment or commercial contracts. Arbitration can
be either voluntary or mandatory (although mandatory arbitration can only come from a statute or
from a contract that is voluntarily entered into, where the parties agree to hold all disputes to
arbitration, without knowing, specifically, what disputes will ever occur) and can be either binding or
non-binding. Non-binding arbitration is, on the surface, similar to mediation. However, the principal
distinction is that whereas a mediator will try to help the parties find a middle ground on which to
compromise, the (non-binding) arbitrator remains totally removed from the settlement process and
will only give a determination of liability and, if appropriate, an indication of the quantum of
damages payable.

Characteristics:

 Arbitration is consensual
 The parties choose the arbitrator(s)
 Arbitration is neutral
 Arbitration is a confidential procedure

Advantages:

 When the subject matter of the dispute is highly technical, arbitrators with an appropriate
degree of expertise can be appointed (as one cannot "choose the judge" in litigation)
 Arbitration is often faster than litigation in court
 Arbitration can be cheaper and more flexible for businesses
 Arbitral proceedings and an arbitral award are generally non-public, and can be made
confidential.

Disadvantages:

 Arbitration may become highly complex

 Arbitration may be subject to pressures from powerful law firms representing the stronger
and wealthier party
 If the arbitration is mandatory and binding, the parties waive their rights to access the courts
and to have a judge or jury decide the case
 In some arbitration agreements, the parties are required to pay for the arbitrators, which
adds an additional layer of legal cost that can be prohibitive, especially in small consumer
disputes