Prakash Yedhula (Lawyer) 25 August 2007

Is it trustworthy?

Many financial companies and government bodies have their own men as arbitrators to adjudicate disputes with customers? Is this practice trustworthy? For example motor furnace companies like TVS, Ashok Leyland Finance etc have only their men as arbitrators. Is this healthy?

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6 Replies

bupesh (n/a) 26 August 2007

I feel that these companies resort to arbitration proceedings as it is both time saving and monetarily cheap. The element of payment of court-fees for the claim is also not there.

However, I feel what the member views are correct. There is certainly an element of bias involved in the proceedings. But overall I feel that arbitration is a better forum than courts.

Shaji Joseph (Lawyer) 03 September 2007

I feel that overall arbitration is mostly arbitrary. Unlike a regular suit where we have a right of appeal, in arbitration proceedings we can assail the award only under certain circumstances. Except that arbitration proceedings are cost effective to the claimant initially, now a days the fee charged by the arbitrators are quite high. One benefit is that a lot of time is saved. I feel that it is a long way to go to arrive at a conclusion.

rashmiramanath (n/a) 18 September 2007

the arbitration must be by a neutral body.

but, in todays scenerio, the arbitrator is a management consultent. he is hired by manager and he summarily targets in favour of management as if he turns neutral and justice, he shall be neglected for further cases

rashmiramanath (n/a) 18 September 2007

kapoorsatish (n/a) 09 January 2008

I agree that Arbitrators favour management and are bias. When overall moral values in society are on decline, judiciary is also part of society and hence affected by corrupt practices, so is Arbitration.

G. GANESAN (ASSISTANT MANAGER) 11 October 2008

Sir,

When the option of appointing an arbitrator is available to the parties, it is natural that they appoint a man of their choice. But whether it is healthy? It is debatable.

One suggestion :As said by other members, the call for request for arbitrator can be given by any of the parties to the arbitration agreement to a neutral body, viz.. Local Chapter of the Institute of Chartered Accountants [disputes coming within their ambit like financial disputes], Institute of Engineers [for disputes coming within their ambit like engineering disputes] and so on , who in turn may appoint an arbitrator from their panel to sort out the dispute. As the arbitrator may not be known to the parties, he is unbiased and his award will be just and fair.