On 17 May 2013, new commercial arbitration legislation commenced in Queensland which replaced the previous Commercial Arbitration Act. The new legislation was introduced following a review undertaken by the Standing Committee of Attorney-General into industry experience with the previous legislation. In particular, the previous legislation was considered by many to be ineffective by too closely imitating the court process and being too readily subject to court intervention. The new legislation is also part of a general push for uniform commercial arbitration legislation Australia-wide.
The advantages of commercial arbitration, as well as other forms of alternative dispute resolution (“ADR”), are:
a) An avenue to resolve disputes outside of the usual court process, which is notorious for its long delays and high costs (even despite the best efforts of the parties and their representatives to achieve a quick resolution).
b) Reduction in procedural formality. This can allow the parties to tailor the process to the circumstances of their dispute, rather than following the court’s “one size fits all” approach. For example, the parties can mutually agree the place for arbitration as well as appropriate timeframes for the filing of documents setting out their case.
c) Confidentiality.
One of the key changes under the new legislation is the adoption of the United Nations Commission on International Trade Law’s “Model Law” as the underlying arbitration regime. The “Model Law” is an internationally recognised and used arbitration regime and brings with it a wealth of international case law which is likely to benefit disputing parties and their advisors in terms of guidance on the rights and obligations of the parties in relation to the new regime. This leads to greater certainty and confidence in the process for disputing businesses.
The new regime also gives participants greater freedom in relation to the conduct of the arbitration, including the ability to appoint multiple arbitrators.
That all said, there are also circumstances where ADR may not be an appropriate way to advance a matter (for example, where urgent injunctive relief is required) and the court process may in fact be the more suited way to resolve the dispute.
In our experience, ADR has become increasingly popular in recent years as a genuine alternative to the court process and all of its inherent drawbacks. We expect that the new commercial arbitration laws will give businesses greater confidence in the ADR process as well as renewed public awareness of what their options are when they find themselves involved in a dispute.
If you are a party to any agreement or have standard agreements or trading terms with arbitration clauses, we would be pleased to assist you by reviewing and updating them so they remain valid with the new legislation.
You are a valued Kinneally Miley contact, for more information related to this Legal Update please contact us.
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Contact Partner: Francesca Petroccitto
Direct Telephone : 07 3210 5771
Mobile Telephone : 0402 293 644
[email protected]
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