Arbitration is a process for resolving disputes without going to court. In this process, the people involved in a disagreement agree to choose a neutral third person, called an arbitrator, to listen to their arguments and make a decision. The decision made by the arbitrator is usually binding, which means both parties must follow it. Arbitration is often used to solve business, trade, or contract-related disputes. It is faster, less formal, and less expensive than going to court. In Nepal, arbitration is governed by the Arbitration Act 2055.
Powers of the Arbitrator
1. Authority to Decide the Dispute:
The arbitrator has the power to settle all issues mentioned in the arbitration agreement between the disputing parties.
2. Requesting Documents and Evidence:
The arbitrator can ask the parties to provide documents, evidence, or any other information necessary to understand and resolve the dispute.
3. Administering Oaths:
The arbitrator can require witnesses or parties to take an oath before giving statements during the arbitration process.
4. Conducting Hearings:
The arbitrator can hold hearings where both parties can present their cases, provide evidence, and argue their points.
5. Extending Time Limits:
If both parties agree, the arbitrator can extend the deadline for making a decision or completing the arbitration process.
6. Issuing Interim Orders:
The arbitrator has the power to issue temporary decisions or orders, such as preventing one party from taking specific actions or preserving assets until the final decision is made.
Duties of the Arbitrator
1. Acting Impartially:
The arbitrator must be fair and neutral, treating both parties equally without bias or favoritism.
2. Following the Arbitration Agreement:
The arbitrator must follow the terms and rules agreed upon by the parties in their arbitration agreement.
3. Giving Equal Opportunity:
The arbitrator must allow both sides to present their evidence, arguments, and witnesses. This ensures a fair process.
4. Maintaining Confidentiality:
The arbitrator must keep all information about the case private and should not share it with anyone who is not involved in the dispute.
5. Issuing a Timely Award:
The arbitrator must give the final decision (called an “award”) within the time period agreed upon in the arbitration agreement or as required by the Arbitration Act.
6. Explaining the Award:
The arbitrator must provide a clear and detailed explanation of their decision, including the reasons behind it, so that both parties understand the outcome.
7. Avoiding Conflict of Interest:
If the arbitrator has any personal or professional relationship with one of the parties that could affect their fairness, they must disclose it and withdraw if necessary.
8. Upholding the Law:
The arbitrator must ensure that the arbitration process and decision comply with Nepal’s laws and basic principles of justice.
Arbitration is a fair and efficient way to resolve disputes without going to court. It saves time and money for the people involved. The Arbitration Act 2055 of Nepal explains the responsibilities and powers of an arbitrator to ensure the process is transparent, impartial, and legal. This makes arbitration a trusted method for resolving conflicts in Nepal.