Section 135 of the ALTERNATIVE DISPUTE RESOLUTION ACT (Act 798) defines the concept Alternative Dispute Resolution (ADR) as the collective description of methods of resolving disputes otherwise than through the normal trial process. This system of adjudication has been part of the traditional dispute resolution process well before the advent of colonialism. Sections 72 and 73 of Act 798 encourages the use of ADR to resolve disputes on matters pending before the courts.
EXCLUSIONS TO ALTERNATIVE DISPUTE RESOLUTION
• Matters of national interest
• Matters that relate to the environment, thus where you are found by the town council it cannot be settled by the ADR
• Matters relating to the enforcement and interpretation of the Constitution.
WHAT ARE THE ADVANTAGES OF ADR?
• It is less adversarial : it encourages openness, disclosure, direct communication and a win-win solution
• It is less costly
• It is less time-consuming
• It is less formal in that the parties themselves are able to control the process and express their opinions and options.
WHAT ARE THE DISADVANTAGES OF ADR?
• There is no opportunity to assess the objectiveness of the process
• No precedent is established which may be a guide to similar disputes in the future
• The potential exists for a stronger party to prevail on a weaker party with the result that het agreement reached may not be fair
• There is no right of appeal
WHAT ARE THE FORMS OF ADR?
• Arbitration
• Mediation : In mediation, a 3rd party is involved but that third party does not give an award but assist the disputing parties , and guide them to resolve the dispute
• Negotiation
• Conciliation : sometimes when the parties are before an arbitral tribunal, the rules may be too formal and so the parties may like an out of court settlement or an informal settlement
WHAT IS ARBITRATION?
Section 135 of the Alternative Dispute Resolution Act, 2010, Act 798 defines arbitration as the voluntary submission of a dispute to one or more impartial persons for final and binding determination. section 59 of the Act makes a provision for the enforcement of a foreign arbitral award in Ghana in accordance with the UN Conventions on the recognition and enforcement of foreign arbitral awards. Arbitration is usually used in resolving commercial matter and disputes; example is that which was between Ghana and Argentina.
Arbitration is a kind of ‘private trial’ and requires the disputants to submit the dispute to one or more impartial persons, with the object of a final and biding decision. thus, section 52 of Act 78 makes the award final and binding as between the parties and person claiming through or under them although a party may challenge the award and if successful may be set aside by the HC. –section 58. Such an award may, by leave of the court be enforced in the same manner as a judgment or order of the court and ,where leave is granted, judgment may be entered in terms of the award.
Once the parties have voluntarily and validly submitted their dispute to arbitration, the court will not generally allow a party to ignore this submission and make a claim in court. Under section 6(3) of Act 798 , the court will normally order a stay of the proceedings.
WHAT ARE THE WAYS ARBITRATION MAY ARISE?
• By reference from a court. Section 7 of Act 798, the court has the power to refer the action or part of it to arbitration with the written consent of the parties where it is of the view that the action or part of it can be resolved by arbitration.
• By agreement after a dispute has arisen. For instance where there is dispute as to the terms of a contract, the parties may agree to refer it to an arbitrator.
• By contract. Contractual parties may put an arbitration clause in their contract such that in the case of a breach they may refer it to an arbitrator to be appointed for instance by the Ghana Arbitration Centre (GAC).
Section 52 of Act 798 makes the award final and binding as between the parties. Under section 58, any person claiming through or under them although a party may challenge the award and if successful, may be set aside by the High Court. Such an award, may by leave of the court, be enforced in the same manner as a judgment or order of the court and where leave is granted, judgment may be entered in terms of the award. This can be found in section 59 of Ac 798. The arbitration may be an expert in the subject matter of the dispute. Organizations such as the Ghana Arbitration Centre, Ghana Association of Chartered Mediators and Arbitrators (GHACMA) and Commercial Conciliation Centre, American Chamber of Commerce (AMCHAM) may provide the requisite expertise.
Under section 6(3) of Act 798, the court will normally order a stay of the proceedings once the parties have voluntarily and validly submitted their dispute to arbitration. It must be stated that Order 64 of CI 47 encourages parties to submit their disputes to arbitration for settlement.
WHAT ARE THE ADVANTAGES OF ARBITRATION?
• It is often faster than litigation in the normal court
• Where a dispute is highly technical, arbitration may be sued to settled since a specialist could be obtained which can’t be found in the main court system
• The choice of the arbitrator is at the prerogative of the parties. They are at liberty to choose who the arbitrator should be and how the process should go
• Since the process is a private affair, the public is not entitled to be present and this may protect certain secrets of the parties.
• The proceedings are generally informal and the strict rules of procedure and evidence are not followed.
• Arbitration may be cheaper for more business and also more flexible.
• In arbitral proceedings , the language of arbitration may be chosen
WHAT ARE THE DISADVANTAGES OF ARBITRATION?
• Not all disputes are amenable to arbitration
• Though the process is based on the cooperation of both parties, a party may stultify the process, by for example not cooperating in the appointment of the arbitrator.
• There is no right to appeal
• Some argue that interim orders are not easily carried out since it is not backed by the police
• Some arbitration procedures may be subject to powerful laws
WHAT ARE THE TYPES OF ARBITRATION?
• Statutory arbitration: this type of arbitration is regarded by the ADR Act only. Section 29 of Act 798 gives the processes.
• Customary Arbitration.
WHAT IS CUSTOMARY ARBITRATION?
Part 3 of Act 798 deals with customary arbitration which starts from section 89-113
Kom defines customary arbitration as the method of resolving claims and disputes among members of the various communities in Ghana. This procedure has been part with us since the introduction of the Bond of 1844 and the Supreme Court Ordinance of 1876.
Under section 89 of Act 798, matters can be submitted under arbitration but you cannot submit criminal matter. No arbitrator is also allowed to serve in customary criminal matters.
WHAT ARE THE ESSENTIAL INGREDIENTS FOR A VALID CUSTOMARY ARBITRATION?
The case of Budu II v. Caeser & Ors gives the five essential ingredients for a valid customary arbitration:
• Voluntary submission of the dispute by the parties to arbitrators for the purpose of having the dispute decided informally but on its merits. This may take this form: whether the parties expressly agree or by their actions one party may submit the matter. “The mere presence of a party to a dispute at a meeting which purports to arbitrate upon a dispute between him and another person, also present at that meeting, is no conclusive evidence or proof of submission to arbitration. To constitute arbitration in such circumstances there must be evidence that the full implications of the purpose of the meeting was explained to each party, and that with the full knowledge of those implications they each agreed that the person or persons before whom they appeared should arbitrate upon their dispute and give a decision thereon. He may adduce some evidence of voluntary submission such as his payment of arbitration fee and /or presentation of drinks”
Nyasemhwe v. Afibiyesan, Yaw v. Amobi, Akunor v. Okan, Section 90 of Act 798.
• A prior agreement by both parties to accept the award by the arbitrators. “The payment of an arbitration fee in the form of money and, or drinks and paid before the arbitration starts or before the award is published may constitute the evidence of both prior agreement and voluntary submission. Thus as in the case of Asano v Taku the swearing of the Ohene’s oath and counter –response by the opponent could amount to prior agreement to accept an award as well as a voluntary submission “Asano v. Taku, Section 109
• The award must not be arbitrary but must be arrived at by hearing of both sides in a judicial manner. Budu v. Caeser, Gbervie v. Gbervie. This tells us we must comply with the rules of natural justice. Attorney General v. Sallah, Article 296. “Where an arbitrator exceeds his agreed terms of reference or proceeds to share het subject-matter in dispute between the disputants the so-called arbitration is null and void ab initio. It is therefore, clear from the cases that arbitrators are by customary law, required to decide any pronounce on the respective conflicting claims of the parties and not to do what King Solomon threatened to do by dividing the baby, the subject-matter of the dispute. The decision on the merits must be arrived at after a fair hearing of both parties. The fundamental principle of natural justice audi alteram partem was recognized as a necessary part of our customary arbitration procedure.
• The practice and procedures being followed in the community must be followed as nearly as possible. Section 93 of Act 798.
• Publication of the award. Publication needs not be in writing. Thus it could be pronounced or announced to the parties. Section 110 of Act 798
An award given is binding on the court. Section 111 gives grounds where customary award may be set aside. Section 112 makes provision for where there is breach of natural justice or miscarriage of justice.
ARBITRATION VRS NEGOTIATED SETTLEMENT
In a customary arbitration, there is a prior agreement to be bound by an award. In negotiated settlement on the other hand, the agreement to be bound is made after the award. In both, the agreement to be bound may be evidenced by the payment of money and / presentation of drinks.
Unlike customary arbitration, a decision in a negotiated settlement need not be on the respective merits of the claims of the contestants. In negotiated settlement, there is a “give and take” , their main aim being to reconcile the parties by offering them what is fair and reasonable in the circumstances. Again, while an award under customary arbitration is biding on the parties whether or not they accept it, an award in a negotiated settlement is binding if and only if accepted by the parties. Normally, on the publication of the award , the parties return to signify their acceptance and then pay a fee and /or present drinks.
In customary arbitration , a party cannot resile after voluntarily submitting himself. However, in a negotiated settlement, a party can resile any time before her formally signifies his acceptance, since before then he is not in law bound.
WHAT IS MEDIATION?
See sections 63-87 of Act 798.
Mediation is an informal, voluntary process in which an impartial person (the mediator), trained in facilitation and negotiation techniques, helps disputants reach a mutually acceptable resolution of their dispute. The role and function of the mediator is not to determine the issues but to assist the parties in identifying issues and information needs, reducing obstacles to communication, exploring alternatives and focusing on the needs and interests of those most affected by the dispute. The objective being to help the parties visualize alternative solutions and the mediator attempts to guide the parties to areas of common ground. If the end result of the process is an agreement, such agreement will be binding on the parties (section 82).
Mediation is distinguishable from other forms of ADR for example arbitration in that the mediator does not impose a solution but rather works with the parties to create their own solution. Mediated solutions often include relief not available in arbitration or litigation. Furthermore, the parties control the outcome, whilst in arbitration, the arbitrator controls the outcome. The mediator has no power to decide , settlement can only be reached with the consent of the parties. In arbitration, the arbitrator is given the power to decide and his decision is generally final.