The default method of having a dispute resolved is litigation in a national court (normally open to the public), which leads to an enforceable judgment. In many cases contracting parties can agree to arbitration, which is similar to the parties selecting their own private Judge for judgment only.

Some topics are not capable of being decided by an arbitrator, such as criminal guilt, marital status, or the validity of a patent, because those can only be determined by the State (through its courts). The subject-matter of most arbitration agreements is commercial:  performance and payment.

Domestic arbitration involves one jurisdiction (e.g., England and Wales), while international arbitration involves foreign elements and is growing with global trade.

Arbitration is most effective in industries where relationships and reputations matter, like commodity trading. It’s less suitable for parties who are unlikely to meet again.

The outcome, an award, can be enforced like a court judgment, though national courts may still be involved. Arbitration is consensual, with few exceptions.

Why choose arbitration?

  • Privacy
  • Industry-specific expertise
  • Potential for speed and cost savings
  • More flexibility than courts
  • Easier international enforcement

However, while it offers many benefits, arbitration can be slower and more costly than expected. It provides limited appeal options, and its flexibility relies on party cooperation.

When to consider arbitration?

Arbitration clauses are often included in contracts alongside choice-of-law and jurisdiction clauses.

If parties agree to arbitrate after a dispute arises, this is known as a submission agreement, though these are rare, as parties are less likely to agree on arbitration when tensions are high.

Should you include an arbitration clause?

Consider all the factors above, especially in international contracts where enforcement is key. If you’re likely to need a judgment or award, find out where your counterparty’s assets are located and whether that country will enforce it.

At Carter Lemon Camerons, we have extensive experience in both domestic and international arbitration.

Our involvement ranges from enforcing international awards from major African construction projects to resolving English domestic construction disputes, all under confidentiality.

If you are considering arbitration, please contact our team of experts for support.

Your Key Contacts

Seamus Smyth

T: 020 7406 1000

E: SeamusSmyth@cartercamerons.com

Seamus Smyth is head of litigation and arbitration. His practice is primarily commercial with an emphasis on arbitration, financial services and work for South African and Italian clients.

Transactions

His reported cases include RH Green & Silley Weir v BR (limitation period against 3rd party), de Bry v Fitzgerald (security for costs), Hartt v Newspaper Publishing (libel concerning a work by Michelangelo), Pearson v Sanders Witherspoon (valuation of loss of chance), Siebe Gorman v Pneupac (status of consent orders), Senate Electrical v NTL (liability of an employee for acquisition warranties) and Bendell v Smith & Others (a successful recovery action by a lender on a shared appreciation mortgage equity release – the only such case to go to trial).

Recently involved in enforcement of foreign arbitration awards, claims arising from the banking upheavals since 2007, a successful claim against a high street bank resulting from a banking error and a successful claim against estate administrators and their solicitors for wasting the estate funds on irresponsible litigation.

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Educated (BA, LLB, Wits) and first qualified as an attorney in South Africa, he requalified in England in 1977, took an LLM at UCL and a Diploma in International Arbitration at QM, and became an FCIArb. He is chairman of the British South African Law Association (for the second time), chairman of Michaelhouse UK Trust, chairman of Global Leadership Foundation (UK), a former President of the London Solicitors Litigation Association and Trustee and President of Town Malling Cricket Club (established in 1827!).  He was until 2012 a Visiting Senior Lecturer in International Commercial Arbitration at London Metropolitan University.  When work and domesticity permit he plays some cricket and more golf (but – which is immediately obvious – not nearly enough).