SMEs encouraged to settle disputes with arbitration scheme

Local SMEs are being encouraged to apply to a scheme from the Chartered Institute of Arbitrators (CIArb) providing support in resolving disputes and upholding their professional reputation.

The Chartered Institute of Arbitrators ' Business Arbitration Scheme (BAS) helps businesses resolve disputes with a value between £5,000 and £100,000.

Speaking about the scheme, Lewis Johnson (pictured), director of policy and external affairs at CIArb, said: “It 's a fact of life that, unfortunately, disputes arise in the course of conducting business.

“If you have a small business, the time and cost of going to court can often be prohibitive, and the litigation process itself can seriously hamper business operations over a long and undefined period of time. Arbitration can offer a faster and more affordable means of resolving a dispute.

“The Business Arbitration Scheme provides a vital service for businesses to support them in resolving disputes. We encourage businesses to take up this route to resolve disputes using a mechanism that provides certainty, is cost-effective and saves time. ”

The scheme is charged at a fixed fee, giving each party involved certainty over costs. In addition, the amount recoverable in legal fees is limited to £1,000 to dissuade parties from incurring high legal costs.

As well at this, BAS offers a final and legally binding award in less than 90 days from when the arbitrator is appointed. The award is enforceable in the same way as a court judgement.

Importantly the scheme protects professional reputation as the process is both private and confidential, maintaining working relationships.

To ensure arbitration is the preferred route to resolving disputes, the CIArb recommend incorporating a contract clause. The BAS clause states:

'Any dispute, controversy, or claim arising out of or in connection with this contract, or the breach, termination or validity thereof, shall be submitted to the Chartered Institute of Arbitrators (CIArb) and settled by final and binding arbitration in accordance with the Rules of The Business Arbitration Scheme. Judgment on any award issued under this provision may be entered by any court of competent jurisdiction. '

Either party to a dispute may apply to the CIArb to request the appointment of an arbitrator.

If there is no contractual agreement between the parties to refer disputes to arbitration under this scheme, they may apply jointly.

Find out more about the scheme, visit: https://www.ciarb.org/disputes/schemes/business-arbitration-scheme/

To enquire call: +44(0)20 7421 7444, or email: [email protected]