Arbitration is a popular means of dispute resolution in Thailand. It is widely used in business contracts and the arbitration law allows parties to stipulate for an arbitration clause.
Courts are empowered to encourage mediation and settlement conferences at the outset of or during litigation. However, prospective litigants are not obligated to pursue such measures.
Alternative Dispute Resolution
Alternative Dispute Resolution (ADR) involves different case management mechanisms outside of the court system. Juslaws & Consult advocates this method of dispute resolution for clients who have signed an arbitration clause in their contract, are otherwise barred from remedying the issue in courts due to a breach of contract or when they simply want a quick and cost-effective solution to their problems.
Arbitration is the process where a third party called an arbitrator listens to both parties and renders a legally binding judgment. Unlike litigation, the results of an arbitration proceeding are private. This privacy allows a company to avoid the negative impact that publicizing a lawsuit can have on its reputation.
Arbitration is a very efficient method of dispute resolution for businesses in Thailand. However, the court backlog and high costs can make it unfeasible to use this method of conflict resolution in large disputes involving tens of millions of dollars or more.
Arbitration
Arbitration is a means of dispute resolution whereby disputing parties agree to submit their dispute to an arbitrator who will make a ruling on the matter. Unlike litigation before a court, which can be an antagonistic and hostile process, arbitration is typically less formal, less expensive, and usually faster to resolve disputes.
Arbitral proceedings are often conducted in the form of hearings before an arbitration tribunal, where the claimant and respondent present their evidence. The tribunal may call witnesses and employ experts to examine evidence. Each party has the right to question any expert witness, and the hearing is closed when all parties declare that there is no further proof to be submitted.
Domestic arbitration awards are binding on the parties, and enforceable in the same way as a court judgment. However, foreign awards must be enforced through a similar process as an international judgment, which is possible provided that the award meets certain criteria set out in the New York Convention.
Conciliation
Although arbitration is the dominant means of dispute resolution in Thailand, conciliation is also available as an alternative. Conciliation involves the intervention of a neutral third party who will try to bring the parties together to settle their dispute. In fact, a judge in a court case will generally inquire and recommend mediation or conciliation before the commencement of a trial.
Disputes in the real estate and construction sectors often arise for several reasons including: omission and errors in a contract document; issues with site conditions; or disputes with a contractor or sub-contractor. Many contracts in these industries will include a structured dispute resolution clause for the settlement of these disputes.
However, the process of settling disputes in these sectors can be lengthy due to the nature of litigation and the court’s trial docket. Hence, the recent amendments in the Civil Procedure Code have enabled prospective litigants to seek a court-supervised conciliation process before filing a lawsuit.
Out-of-Court Mediation
Going to court can be a lengthy and expensive process. Even when a judge’s decision is favorable, you might have to spend additional time and money on a successful appeal.
Alternative Dispute Resolution mechanisms are an ideal solution to these challenges. They allow disputing parties to resolve their disputes outside the classical judicial system and are widely used in Thailand. Our Thailand Conciliation and Mediation Lawyers strongly suggest that you should consider taking advantage of these mechanisms.
