Disputes Resolutin

1 in
Economic and monetary
Sector
 Dispute resolution refers to methods used by trained
neutrals to help people to communicate more clearly,
negotiate effectively, develop and evaluate solutions, or
resolve conflicts.  Neutrals do not take sides or represent
the parties. 
 Dispute resolution offers a private and voluntary option
beyond court.
 Dispute resolution can be used in a wide variety of
situations including unpaid bills, landlord/tenant disputes,
or neighbor conflict.  It can also be very effective in
matters that involve many people, strong emotions, and
competing interests, like divorce, workplace conflict,
victims and offenders, or community controversies.  Using
dispute resolution before conflict has escalated can be
helpful, but it can be very successful even when people
get stuck in complicated and intractable conflict. 
2
Dispute resolution processes fall into two major types:
Adjudicative processes, such as litigation or arbitration, in which a judge, jury
or arbitrator determines the outcome.
Consensual processes, such as collaborative law, mediation, conciliation, or
negotiation, in which the parties attempt to reach agreement.

3
 Dispute Resolution
4

There are three ways that enable people to

resolve the dispute(s) that arise in the
economic and monatary sector:
Alternative Dispute Resolution (ADR);
 arbitration;
 Judicial System (court).
DISPUTE RESOLUTION/SETTLEMENT PROCEDURE
General
5 Court
LITIGATION/
Through Court Commerce
Court
Judicial
(Formal) NATIONAL
Procedure ARBITRATION
ARBITRATION

INTERN’L-
Dispute
II ARBITRATION
Resolution
NEGOTIATION
Process

MEDIATION
Informal
Procedure FACILITATION

I
CONSILIATION
INFORMAL PROCEDURE
 Negotiation is a discussion between two or more people
solving disagreements, deciding what to do, or making a
bargain.  Negotiation may involve advocates or
representatives.
 Mediation is an informal, voluntary process in which a
mediator facilitates negotiations between disputing parties.
The mediator's role is to help the parties find a mutually
acceptable solution to the dispute. In addition, mediation can
be faster and less expensive than arbitration or litigation. If
the parties agree to mediate, they will not give up any right
to arbitrate or litigate if they cannot reach a satisfactory
settlement. Mediation is a method for discussing problems
and exploring solutions with the help of a trained neutral. 
Mediators help people communicate clearly and negotiate
effectively.  Mediators do not take sides, give legal advice,
make decisions about resolutions or impose solutions. 
Mediation is private and voluntary. 
6
INFORMAL PROCEDURES
Facilitation involves a neutral who helps members of a group to
define and meet their goals, exchange ideas and information,
solve a problem or hold effective meetings. 
Conciliation is the use of a third person who is asked to help
people reach an amicable resolution of their dispute.  The
conciliator does not have the authority to impose a settlement,
and usually speaks with the parties separately.

7
1. A process of dispute resolution based
on negotiation
2. A mediator involved and admitted by
the disputing parties in the negotiation
3. Mediator is assisting the disputing
parties to achieve a resolution
4. The mediation aim at achieving or
resulting in an agreement that
admitted by the parties in order to end
the dispute.

8
1. A process of dispute resolution based
on negotiation.
2. A conciliator hold the right and
authority to express his opinion openly
to the parties and without taking sides
to any disputing party.
3. The conciliator does not have the authority to
impose a settlement on behalf of the disputing
parties.
4. Final decision is fully conclude by the
disputing parties based on the
conciliation and is written into an
agreement between the disputing
parties.
ALTERNATIVE DISPUTE RESOLUTION (ADR)
 Alternative Dispute Resolution (ADR) typically refers to
processes and techniques of resolving disputes that fall
outside of the judicial process (formal litigation – court).
 (ADR) is extrajudicial processes such as arbitration and
mediation used to resolve conflict and potential conflict
between and among individuals, business entities,
governmental agencies, and in the public international law
context.
 ADR generally depends on agreement by the parties to use
ADR processes, either before or after a dispute has arisen.
 There are generally five categories of ADR. These are
negotiation, mediation, facilitation, Conciliation and
arbitration .
 Courts are increasingly requiring some parties to utilize ADR
of some type, most often mediation, before permitting the
parties' cases to be heard. 10
ALTERNATIVE DISPUTE RESOLUTION (ADR)
 Retired judges or private lawyers often become
arbitrators or mediators; however, trained and qualified
non-legal dispute resolution specialists form a growing
body within the field of ADR to facilitate settlement of
lawsuits
 ADR has experienced steadily increasing acceptance and
utilization because of a perception of greater flexibility,
costs below those of traditional litigation, and speedy
resolution of disputes.However, some have criticized
these methods suggesting that extrajudicial dispute
resolution may not offer the fairest way for parties not
in an equal bargaining relationship, for example in a
dispute between a consumer and a large corporation. In
addition, in some circumstances, arbitration and other
ADR processes may become as expensive as litigation or
more so 11
ALTERNATIVE DISPUTE RESOLUTION (ADR)

 All ADR procedures, but negotiation, include the presence

of a neutral person capable of providing an unbiased
opinion who acts as a facilitator or decision maker.
 ADR has proven very helpful in many different types of
legal disputes. These include divorces and other family
matters, professional liability cases, personal injury
situations, insurance issues, and many other disputes.

12
FORMAL PROCEDURES

 Litigation is a legal dispute argued in court.  Attorneys

help negotiate a resolution, or a judge makes a decision. 
The people directly involved have little control over the
process or outcome.
 Arbitration is a formal proceeding that uses one or more
neutrals to listen to evidence and render a decision.  The
decision may be binding or non-binding. Arbitration is an
alternative to litigation or mediation in order to resolve a
dispute. Arbitration panels are composed of one or three
arbitrators who are selected by the parties. They read
the pleadings filed by the parties, listen to the
arguments, study the documentary and/or testimonial
evidence, and render a decision.

13
JUDICIAL (FORMAL) PROCEDURES
 The most common form of judicial dispute resolution is
litigation. Litigation is initiated when one party files suit
against another.
 In Indonesia, litigation is facilitated by the government
within Supreme, High, and District courts.
 The proceedings are very formal and are governed by
rules, such as rules of evidence and procedure, which
are established by the legislature.
 Outcomes are decided by an impartial judge, based on
the factual questions of the case and the application of
law.
 The verdict of the court is binding, not advisory;
however, both parties have the right to appeal the
judgment to a higher court.
14
 Act # 30 of 1999
Regarding Arbitration and alternative Dispute
Resolution.

Article 1:
(10). Alternative Dispute Resolution (ADR) is a
mechanism of settlement of disputes that falls
outside of the judicial process through procedures
agreed upon by the parties in the form of
consultation, negotiation, mediation, conciliation, and
judgement of experts.

15
ADR (Article 6)
On the basis of “good faith” Didasar by pulling aside litigation
process in the district court (sub article 1)
To be resolved in the meeting between the parties in the period
of as long as 14 days and the result of it shall be made in a written
agreement between the parties (sub article 3)
If the disputes cannot be settled then based on a written
agreement of the parties, the disputes will be settled by one or
more mediator or a trained experts (sub article 3)
If within 14 days the appointed mediator or experts fail to bring
the parties into a mutual agreement, or the mediator or ecpert fail
to bring the parties into a face to face meeting, the parties may
bring the disputes to an arbitration court or another ADR agency
to appoint a new mediator.
Upon the appointment of a new mediator by the arbitration
agency or another ADR the effort to settle the dispute shall be
started.
16
ADR (continued)

The effort to settle the dispute through a mediator,

shall, within 30 days, result in a written agreement
swigned by the said parties (sub article 6).
The agreement concerning the dispute resolution is
final and binding to the parties to be performed in a
good faith and shall be registered in in a District Court
within 30 days after the agreement is signed(sub article
7)
The agreed dispute resolution as pointed out in sub
article 7 shall be performed within 30 days after the
registration (article 8)
If the effort to resolve the dispute fails, the parties,
based on a written agreement, may file the case to a
permanent arbitration court or an ad hoc arbitration
court.
17
ARBITRATION PROCESS

18
ARBITRATION

Arbitration is a formal proceeding that uses one or more

neutrals to listen to evidence and render a decision.  The
decision may be binding or non-binding. Arbitration is an
alternative to litigation or mediation in order to resolve a
dispute. Arbitration panels are composed of one or three
arbitrators who are selected by the parties. They read
the pleadings filed by the parties, listen to the arguments,
study the documentary and/or testimonial evidence, and
render a decision.

19
 Act # 30 of 1999
Regarding Arbitration and alternative Dispute
Resolution.
Article 1:
(1) Arbitration is a method of dispute resolution in a
civil case that is undertake outside the general court
that is based on written agreement made by the
disputing parties.
(2) The disputing parties are legal subject according to
Civil law as well as Public Law.
(3) The arbitration agreement is a mutual consent
written in an agreement made by the disputing
parties prior to the existence of dispute, or a separate
agreement made by the parties after the dispute
arised.
20
ARBITRATION
(7). The arbitrator is a person or more chosen by the
disputing parties or appointed by the District Court
or an arbitration agency in order to make decision upon
certain dispute that is resolved through arbitration
mechanism.
(8). Arbitration is a mechanism adalah badan yang dipilih
oleh para pihak yang bersengketa untuk memberikan
putusan mengenai sengketa tertentu; lembaga tsb juga
dapat memberikan pendapat yang mengikat mengenai
suatu hubungan hukum tertentu dalam hal belum timbul
sengketa
ARBITRATION

22
 The arbitration provision is included in
the main contract stating that the
dispute that might arise related to the
performance of the contract will be
settled through artbitration. This
Two Ways of Using “Pactum Compromittendo”.
Arbitation for  The Arbitration provision is written in a
settlement of
separate contract, not included in the
dispute
main contract. This contract is
especially made when a dispute arises in
the implementation of the provisions of
the main contract. This kind of
agreement/contract is called “Akta
Kompromis”
ARBITRATION

23

1. Closed to public (Secretful)

WHY PEOPLES 2. The Procedure is simple

CHOOSE
ARBITRATION? 3. The decision is binding to all
parties

4. The decision is Final (No

appeal
ARBITRATION

24

TWO KINDS OF
ARBITRATIONS
ARBITRATION

 Based a written agreement signed by the parties (separate

Contract)
 The said witten agreement should contain:
a. The problem of dispute
b. Name and address of the parties
c. Name and address of the arbitrator or arbitration agency
d. Place where the arbitration process will take place or board or
arbitrator to make decision upon the case/dispute.
e. Name of the secretary
g. Statement of availability of the arbitator; and
h. Statement from the parties to be responsible to pay any cost
related to the resolution process through arbitration.
 The absence of such items in the arbitration agreement would
make the agreement becomes void.

25
ARBITRATION

Requirements for an Arbitrator

Someone who would be an arbitrator should fulfill the following
criteria:
a. Having an ability to do legal maction(age, mental, etc.);
b. At least 35 years old;
c. There is no family or relative relation between the arbitrator
and the party(ies)
d. There is no financial interest or other interest tidak
mempunyai kepentingan finansial atau kepentingan lain atas
putusan arbitrase; dan
e. Having experience and expertise in the problem of dispute
at least five years.

Existing judges, prosecutor, and judicial clerk are not eligible to

become an arbitrator(s).

26
To be valid and enforcible, the decision made by the arbitartor in
an arbitration must be registered in the District Court. The
Chairman of the District Court will
27 examine the decision based on
the following criteria:

1. Whether the parties have agreed to resolve the dispute

through arbitration.
2. Agreement signed by the parties.
3. The dispute is within the trade sector and is related to
rights in accordance existing legislations or laws.
4. The dispute is not in contrary with pubic order and social
norms
 BADAN ARBITRASE
NASIONAL INDONESIA (BANI)

28
BADAN ARBITRASE
MUAMALAT INDONESIA (BAMUI)

 The implementation of the national arbitration shall be undertaken

within 30 days after the decision is made.
 To be enforcible, the authentic copy of the decision shall be
registered to the Judicial Clerk of the District Court tobe exemined
by the Chairman of the District Court.
REQUIREMENTS FOR AN INTERNATIONAL ARBITRATION
DECISION TO BE ENFORCIBLE IN INDONESIA
29

1. Decision of the International arbitration is made by an

arbitrator or board of arbitrator in a country that has an
agreement with Indonesia, bilateral or multilateral regharding
the recognition and implementation of an international
arbitration decision.
2. The decision made by the international arbitration shall be
within trade sector.
3. The decision is not in contratry to public order
4. The international arbitration decision can be implementated in
Indonesia after being approved by the Chairman of the Jakarta
High Court.
CANCELATION OF AN ARBITRATION DECISION
30

Each party to the dispute resolution process through

arbitation may file a cancelation of the decision to the court
based on the following:
a.Any document or documents used in the examination of
the case is false or fake.
b.After the decision is made it is found that there are
important documents are hided by the other party.
c.The decision is made based on an unfair action by the
other party
COMPARATIVE

31
CHARACTERITIC RESOLUTION PROCESS
THROUGH LITIGATION:
1.Win-Lose Solution
2.Taking a very long time (Time consuming)
3.Require a special palce/building/office
4.High Cost (“Looking for a goat by sacrifying
a Cow”)
5.Use lawyer(s)
6.Very Bureauchratic

32
CHARACTERITIC RESOLUTION PROCESS
THROUGH ARBITRATION and other ADR:
1.Win-WIN Solution
2. Least time consuming
3.Least Cost (“does not Looking for a goat by
sacrifying a Cow”)
4.No Special place or building
5.Not Bureauchratic

33