Sample Law Paper on Dispute Resolution Clause

Sample Law Paper on Dispute Resolution Clause

Negotiations

The three parties would strive in a show of good faith to resolve all the disputes or claims that might arise out of this agreement by finding the middle ground by the assigned directors from all the three parties to solve the issue of concern. The dispute would have to be settled with a period of fourteen days as stipulated in the California Law after all the parties have served each other with written communication on the disputed facts. The rest of the provisions in this clause shall only apply when all the parties have given out their written notices regarding the dispute.

Any dispute, claim or controversy that might arise out of the agreement or related to the agreement must be resolved within fourteen days, failure to which, the dispute shall be subjected to mediation(Blankley, K. 2016,743). The three parties shall share the filling fees and the mediator’s fee equally. Mediation process shall be held where the business is located unless the parties mutually agree on another location. The decisions made during the mediation shall be enforceable and treated like settlement agreements made in the court of law. Failure to resolve the dispute in this stage would automatically lead to mediation

Mediation

In cases of a dispute that is related to or which has arose out of this contract, or if there is a breach of the agreement  was signed by the parties, and if the issue in question could not be settled by negotiation, the parties would agree to resolve the dispute  through mediation(Blankley, K. 2016,743). The mediation would be administered by American arbitration association. The association shall follow commercial mediation procedure before it decides to use litigation, arbitration, or any other procedure available for dispute resolution. This clause calls on the parties to submit qualification of mediators in case the American arbitration association is not available immediately.

The submissions should also include the expenses and fees, the places of meetings, allocated time limits and any other concern that the parties might have regarding mediation provision. The parties shall agree on a mediator. If they fail to have any mediator within fourteen (14) days, then a local provider of the mediation services shall be appointed as the mediator for the parties. The mediation shall be held within 45 days after the acquisition of the mediator (Blankley, K. 2016, 745). During this session, no party is expected to fail to adhere to the set rules governing the process.

Arbitration

Any dispute, claim or controversy relating to or arising out of this agreement, or termination, breach or invalidity would be solved under the UNCITRAL Arbitration rules as of the date of this agreement. International centre for dispute resolution shall be the appointed authority the centre shall administer the case under its procedures used for cases that fall under UNCITRAL arbitration rules.

In the event that disputes arise among the three parties regarding the interpretation of this agreement or any of its provisions, or on performance and relevance of any of the included terms, then such disputes shall be settled in the following manner (Blankley, K. 2016, 745).

  1. Under the California arbitration status
  2. Four arbitrators ,three appointed by the by the parties and the fourth one who will act as the chairman would be appointed by the three arbitrators appointed by each party and failing the International chamber of commerce chair
  3. English shall be used as the language of arbitration by the three parties; and
  4. The place of arbitration shall be California

In case the issue of concern involves claims of more than $500, 000, then the parties are at liberty to work together or independently to come up with guiding rules on how the dispute should be handled. The regulations should include the criteria what should be used in selecting arbitrators who must satisfy the thorough criteria set by the panel. It should include all the necessary orientation, training and coordination of the selected arbitrators in a way that would facilitate smooth arbitration program (Blankley, K. 2016, 747). The program should establish procedures that would be used for the purposes of administration of cases that are regarded as areas of disputes. Another issue to consider is the flexibility of the program so that, the three parties could efficiently and speedily resolve all disputes which might arise in future.

Joiner

In case any dispute which is referred to arbitration covered by the license agreement and joint venture agreement raises concerns that, according to the three parties are linked to the issues covered in the dispute resolution clause between these three parties and successors in assigns and title:

  • “USCO”; American wireless united corporation
  • “ARGO”; Argentina utility company
  • “BigBank”; Brazilian bank
  • Their successors and counter parties in formation of Argentina Corporation.

Which has been directed to arbitration in line with provisions of the arbitration significantly similar (mutatis mutandis) as this resolution clause then?

  1. The dispute shall be referred to the appointed arbitrators to evaluate the similar dispute and
  2. The three arbitrators and their chairman shall have the authority make necessary discretions and grants in the same manner as of the rules of Californian law regarding international arbitration as to joining one or all third parties or defendants or consolidating all applicable actions to the parties and the appointed arbitrators.

In case the dispute referred to the clause if from the two agreements, then any dispute that is related to them any be consolidated or joined with the dispute that arises from any agreement

Referral of Disputes to Experts

If the dispute arises from financial or technical matters, the three parties would consider the following provisions in handling the dispute which is to be referred to an expert

  1. In case of any dispute being referred to experts in line with resolution clause, all the parties would be involved in selection and appointment of an expert, or when a party decides to consult an expert alone without involving the other parties, then the appointment shall be done within seven days after the party has notified the other two parties that it wishes to refer the issue to an expert by
  2. Disputes which relate to technical nature of the new business(Argentina corporation)
  3. The president of the association of chartered accountants in United States of America concerning all other issues

Failing agreement among the three parties in line with the properties of the dispute, the selected expert shall be appointed by the president of the association of chartered accountants of the United States of America.

  1. The expert would be expected to settle or resolve the disputes or matters in a way that he deems fit in his absolute discretion. The parties should request the expert to come to a decision within thirty days after the date the matter was referred to him. The decision by the expert shall be final and shall a bind all parties
  • The expense of hiring the services of an expert shall be share equally among parties unless the expert decides to be paid by one particular party.

Performance to Continue During Dispute

During the dispute pendency, all the three parties shall continue to diligently and timely perform their obligations under the joint venture agreement as long as it not the issue of concern of the reason for dispute. All the payments expected from the parties must be paid without being withholding pending the outcome of the dispute resolution (Blankley, K. 2016, 753). The parties must continue to do all their roles as stated in the joint agreement and only roles or payments that form part of the dispute could be withheld during the resolution period.

The aim of the dispute resolution is to allow room for the parties to continue trusting each and a forge ahead towards realizing their vision for the business (Blankley, K. 2016, 753). The process enables the parties to know that their areas of concern are taken seriously. However, this does not call for parties to withhold their services or lag behind in their obligations in the partnership. This clause, therefore, shall call on all the parties to continue with their obligations to the partnership as the dispute resolution process unfolds.

Making the Award

The clause shall allow member parties to specify dates of making awards that, results from successful arbitration process (Blankley, K. 2016, 762). This shall depend on the period taken since the arbitral tribunal was constituted, the adopted terms of references, the disputed case and the closure of the arbitration process. Because of the number of the appointed arbitrators, the decision adopted by the tribunal must be that which has been endorsed by the majority(2 in this case).The dispute clauses  provide that the chairman’s vote to decide the majority in case there is no majority vote, in this case the chairman would not need to give his vote.

The award shall be made after all the parties have been duly informed of the process and the decision arrived at. The content and form of the award must follow all the requirements of the UNCITRAL. The award shall be in written form and signed by the directors of all the three parties. It must show the place of arbitration, date and the reason why the award is made (Blankley, K. 2016, 765). The parties are allowed to suggest any arbitration law that they would have wished to be considered for making of award. It must be noted that these laws may come with extra requirements such as identification of the arbitrators, concerned parties, their representatives and the detailed description of the arbitration process.

Recognition and Enforcement

In case of an event where the arbitral award is not executed, the clause would follow the guidelines of the New York convention (Blankley, K. 2016, 777). The NYC states that recognition and enforcement should be the last step in arbitration process. It happens when the parties did not make the arbitral award. Many parties prefer to make their execution of the arbitration voluntarily. Although recognition and enforcement is considered as the weakest provision in the international dispute resolution, the NYC has been ranked as one of the most successful international conventions in the world, hence should be adopted for the purpose of this clause.

 

 

 

 

 

Reference

Blankley, Km 2016, ‘The Ethics and Practice of Drafting Pre-Dispute Resolution Clauses’, Creighton Law Review, 49, 4, pp. 743-774, Academic Search Premier, EBSCOhost, viewed 14 November 2016.