The essence of arbitration is a developed method of resolving dispute where the persons involved in the particular contract will be expected to choose an arbitrator (on a neutral basis) who will formulate orientations regarding to the contract with the aim of providing a ruling which should bind both of them. . The use of the system is highly applicable because of the confidential nature of the process, its high speed of formulating legal transactions, faster ability of enforcing various arbitral legal transactions, as well as its ability of eliminating uncertainties through use of an arbitrator or a panel of them.
In London, arbitration law is provided by the 1996 Act on arbitration. This is a revised edition of the 1954 Act on arbitration. Its provision is provided in a public law draft comprised of three parts. The document acts as a guide in the persuasion of settling disputes of an international contracts capacity. It is comprised of various statutory clauses that are followed in such international disputes. The legacy in international arbitration involves the establishment of an arbitral tribunal. This consists a panel of arbitrators from either of the parties to the case.
However, in all its the arbitral tribunal involves following some jurisdictions which relate to the nature of the arbitral cases. This statement is true and seeks to formulate a standard base of understanding the basics of this case. Through a plight of investigations from either of the parties in to it, the panel of the arbitrators uses the law clauses in providing for an award that would considerably be at a balance to both. However, the arbitration clause provides an instrument in which the panel of arbitrators seeks to formulate an award to the parties concerned.
The arbitration clause is also called the contract clause in which dispute in the parties is resolved via the process of arbitration. It is a binding resolution which is active outside the court frontier. The truth-value of the clause is however dependent on the resolution of the arbitrators which does not necessarily imply an authentic position. 1 With the international business scales, the use of the national constitution law would be inapplicable to persons form such national origins due to the differences in the constitutional and commercial laws from different countries.
With arbitration, the parties into a legal suit are given the control protocol on how the proceedings to the legal suit inquiry for such cases should be conducted. . Internationally, contractual relationship between such persons is guided by the international commercial arbitration which formulates hypothetical legal foundation to drive for a standard law suit for the persons. Apparently therefore, the internationally commercial arbitration is a foundation strong enough for formulating various legal suits for those affected by contractual relationship between two or more parties form different nationals.
Generally, arbitration uses non-judicial method of solving disputes at the international levels. This is perhaps the most important reason that makes the method to be quite applicable. In the case of judicial method, one of the parties into the case could be affected where justice could be comprised in the attempt to formulate a resolution. Either, through the use of litigations within the specific foreign court, such litigation may arise to be heavily time consuming, expensive as well as being complicated. Elsewhere, such legal decision, which is to be entered within such foreign court, would not be enforceable.
Therefore, awards provided by arbitral cases are highly recognized in the international imagery. 2 Either, the choice of a panel in the administration of international arbitration is an advantage because the agreement is between the parties themselves. Through the wards brought out through the arbitral process, these are taken to be binding and showing the most final response by the arbitrators. With such a case therefore, their resolution is highly limited to attracting appeals form either of the parties to it.
Apparently, the study case about the poisonous rice calls for a remedy in the application of international commercial arbitration since the case is affecting parties form different countries. Firstly, the contract between Heinrich Fehr LLC and Alvard Sagar Ltd related to a full suit of a binding and a legal contractual relationship between the two companies. Any breach of the contract would call for legal suits between the parties. Due to the nature of the agreements, the contract is their enforceable. Various legal relationships are deemed to develop between the three companies engaged in the contractual process.
However, for the contract to be operative, the requirements of a contract should be fulfilled. The nature of the buying and selling of the rice package between the two companies has adequately fulfilled the requirements of a valid and legal contractual relation. At one point, it is made to provide a condition of legal relationship between the two parties. Legally, the contract is based on a normal business foundation which could still have called for legally acceptable behaviour. Either, it is an agreement between two parties where they have chosen to exchange legal agreements in pursuit of a contractual relationship.
Legally, all contracts should be made between two or more persons. Occasionally, the contract should be based on the principle of giving an offer by one party and acceptance of some offer by the other party. In this case, the above case fulfils this condition where the two companies have adequately fulfilled this requirement. The exchange of these offers is an important step in formulating a legal contract relationship. It has been made in a former writing which fulfills one of the requirements for contractual relationship. Contract should be made in writing or in oral terms. To this contract has been made through writing.
(Bingham, 2004)1 The sub-contractual relationship between Alvard Sager and the Rabin Limited is still an area of consideration in regards to the elements of contractual relationship. With this subcontract ship, the concept of agency theory is brought up. Business law has well-founded regulations on agency relationships. This is in the realization of the role played by agents in the contract. Legally, the Robin Company is acting on behalf of the Alvard Sagar and therefore the law is still binding between Rabin Company and Heinrich Company where Rabin acts on behalf of the Alvard Sager.
Broadly, the supply of poisonous rice package to the premises of Heinrich in England is a direct breech of the contract between the former two companies, (i. e. Heinrich and Alvard sager). According to the law of contract, a subcontractor acts under the capacity of the original contractor and any breach in subcontract amounts to a breech in the original set up of the contract. Therefore, with the drawing of damage claims by the two affected consumers would amount to a legally upright case between Heinrich Company and the Alvard Sagar. 3 To the two customers therefore their claim for damages is an upright move.
Such damages should be awarded to them by the Alvard Sager, which is directly affiliated to the contract with Heinrich Company. This is because; the foundation of the contract was to provide a good supply of rice, package to the companys premises in London. The basic terms of the consignment were a rice package which would have been safe for human consumption. However, the supply of poisons rice, by the Rabin Company (an agent through subcontract) was a breech of the original contract. Therefore, at one point the two public consumers are correct to demand for damages in the consumption of the poisonous rice form the company (Heinrich).
Either, through a contractual suit, the company can go ahead to demand the equivalent damages to the cost of the supply of the poisonous rice to their premises by the Alvard Sager through its agent, the Rabin Company. 4 Contractual law has two legal foundations at this point. Firstly, Alward Sager may pay damagers to the Heinrich Company before demanding an equal cost of damage form its agent (Rabin company). Alternatively, the company may draw an agreement between it and its agent that the same agent provide the same amount of damages to the Heinrich company as it would have itself provided.
However, this may depend on the Heinrichs company in accepting such a transaction as it has the legal right to reject such an offer. However, in the case of its acceptance the Rabin Company can adequately forward the damages to the Heinrich Company. However, the provision of damages by the Rabin Company may be limited to the agreement made between it and the Alvard Sager. It would only be in respect to some specific contractual relationships which may amount to Rabins provision of the damages to the Alvard Sager. Reference.
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