A3: Essential Elements of Legal Systems | Alternative Dispute Mechanisms (ACCA LW)

Alternative dispute mechanisms covers topics such as adjudication, alternative dispute resolution mechanisms, international courts of trade, the UNCITRAL Model Law, the arbitral tribunal and arbitral awards.

Alternative Dispute Resolution Mechanisms

a. Explain the operation, and evaluate the distinct merits of court-based adjudication and alternative dispute resolution mechanisms.

Court based adjudication depends on the court system that settles legal disputes. There is a lower level court for minor matters and a higher level court for serious matters.

A court of first instance is a court where a case is heard for the first time. An appellate court or court of appeal is a higher court which can “re-hear” a case that was decided in the court of first instance.

The civil court system in England consists of several courts, tribunals and councils including the County Court, the High Court and the Court of Appeal. The criminal court system also consists of several courts including the Magistrates’ Court, the Crown Court and the Court of Appeal.

Indictable offences – serious offences that can only be heard in a Crown Court

Summary offences – Minor crimes that are only triable summarily in Magistrates’ Courts

 Note: Some offences can be both indictable and summary offences 

Pre-trial disclosure – The practice of disclosing documents relevant to the case to the opposing party, before the trial begins.

Advantages of Court-Based Adjudication

  1. Can provide helpful legal solutions and settlements
  2. Can establish judicial precedent for future similar cases

Disadvantages of Court-Based Adjudication

  1. More expensive
  2. Can be lengthy process

Alternative Dispute Resolution is a voluntary procedure that is used to resolve disputes as an alternative to court based adjudication. Arbitration,  mediation and conciliation are all examples of alternative dispute resolutions.

Arbitration can propose different solutions to court based arbitration.

  • Changes in behaviour
  • Promises
  • Apologies
  • Explanations
  • Correction of mistakes
  • Compensation
 Mediation and conciliation use independent third parties to assist the involved parties in finding a solution. In Islamic law, wasta is mediation and solh is conciliation. 

Advantages of Alternative Dispute Resolutions:

  • Both parties choose the person who will settle the dispute
  • May be cheaper than court based adjudication (depending on the country)
  • Informal
  • Quicker than court proceedings

Disadvantages of Alternative Dispute Resolutions:

  • Proceeding are usually kept private
  • May be more expensive than court based adjudication (depending on the country)

b. Explain the role of the international courts of trade including the International Court of Arbitration.

When there are international legal disputes, international adjudicators such as international courts and international venues for arbitration may be required to solve the legal problems. The European Court of Justice is an example of an international court and the International Court of Arbitration is an example of an international venue for arbitration.

The European Court of Justice (ECJ) is the highest court in the European Union and is ordered along civil law lines.

The International Court of Arbitration was set up in 1923 and applies rules of arbitration set out by the International Chamber of Commerce.

 Arbitration is used to settle international commercial disputes. 

c. Explain and apply in detail the provisions of the UNCITRAL Model Law on International Commercial Arbitration.

The United Nations Commission on International Trade Law (UNCITRAL) adopted the Model Law on International Commercial Arbitration in 1994. This law is a set of rules to be adopted into national laws intended to make international practice uniform.

UNCITRAL involves:

  • the settlement of a disputed contract by an independent third party
  • compromise
  • two disputing parties who may or may not be legally represented

Arbitrators must:

  • have the necessary qualifications
  • independent and unbiased
  • not disclose facts that impair independence
  • disclose circumstances that threaten independence
  • withdraw from the position if it becomes impossible for them to act

Disputes that are submitted to UNCITRAL should:

  • be agreed to in writing (document or written contract)
  • contain an “arbitration clause” agreement

Advantages of UNCITRAL Arbitration:

  • No court costs
  • Decision making is fast
  • Private, unpublicized matter
  • Informal
  • Arbitrator is an expert in the area under dispute
  • Decisions are more innovative

Disadvantages of UNCITRAL Arbitration:

  • Parties are bound by privacy
  • No application of the law
  • Outcomes are not predictable
  • Precedent is not practiced

d. Describe the arbitral tribunal.

Under the Model Law, there must be three arbitrators in the arbitral tribunal.


  • Must be independent
  • Can be appointed based on the parties’ wishes
  • Must be qualified
 The arbitral tribunal can rule on anything in its jurisdiction. 

Under arbitral tribunal proceedings:

  • Parties should be treated equally and each party must be given the opportunity to present its case
  • Parties can agree on the procedure to be followed subject to the Model Law requirements
  • The arbitral tribunal can conduct the arbitration in a manner which it considers fit if the parties can not agree on a procedure

General points of arbitration are:

  • Place – Parties agree on the place of arbitration
  • Commencement – Parties agree on when the proceedings will begin
  • Language – Parties agree on the language of the proceedings
  • Experts – Experts may be appointed by the parties or the tribunal to report on specific issues
  • Court assistance – Permission may be granted by the tribunal for evidence from a competent court

e. Explain arbitral awards.

Arbitral awards are binding, written judgements of the arbitral tribunal. Proceedings may end with an award or a termination and must be the decision of the majority of the arbitrators.

Arbitral awards should:

  • Be in writing
  • Be signed by the arbitrators
  • State the reasons behind the award
  • State the date of the award
  • State the place of arbitration
  • Be copied and sent to each party
 Parties can apply to have the arbitral award set aside if they can prove that certain factors existed. 

Resources Used:

Related Posts

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.