How to Prepare for Arbitration: A Practical Guide

Arbitration is more formal than mediation and less formal than court. It has a defined procedure, and how well you prepare at the outset shapes both the timeline and the outcome. This guide covers the practical steps, from reading your clause to the award. ## Step 1: Read your arbitration clause carefully Everything starts with the clause in your contract. Before doing anything else, identify what it actually says about: - **The seat.** This determines which court supervises the arbitration and which procedural law applies. It is distinct from the venue, which is merely where hearings physically happen. The seat of arbitration glossary entry explains why this distinction matters. - **Institutional or ad hoc.** Does the clause name an institution such as the MCIA, IIAC or ICA, or does it simply invoke the Arbitration and Conciliation Act, 1996 directly? Institutional arbitration comes with rules, a secretariat and an appointment mechanism; ad hoc arbitration leaves those to the parties. - **Number of arbitrators.** A sole arbitrator or a three-member tribunal. If unspecified, the Act provides a default. - **Language and governing law.** If the clause is ambiguous — a common problem — resolving that ambiguity may itself require a preliminary application, so identify the issue early. ## Step 2: Issue a proper notice of arbitration Arbitration begins with a written notice invoking the clause. Under Section 21 of the Arbitration and Conciliation Act, 1996, proceedings commence on the date the respondent receives that request, unless the parties agreed otherwise. That date matters for limitation purposes. A notice should identify the parties and the contract, invoke the arbitration agreement, describe the dispute and the relief sought, and propose an arbitrator or the appointment mechanism. ## Step 3: Constitution of the tribunal Where the clause names an institution, the institution's rules govern appointment. Where it does not, the parties appoint by agreement, or each appoints one arbitrator with the two appointees selecting a presiding arbitrator. If appointment stalls — a common delay tactic — Section 11 provides the fallback. Since the 2019 amendment, designated arbitral institutions can make appointments in place of the courts, which is usually faster than a court application. When an arbitrator is proposed, check for disclosure. The Fifth and Seventh Schedules to the Act set out circumstances affecting independence and impartiality; the Seventh Schedule circumstances disqualify an arbitrator unless both parties waive them after disclosure. ## Step 4: Prepare your documentary case Arbitration is largely a documents-driven process. Assemble: - The contract and any amendments - Correspondence relevant to the dispute, in chronological order - Invoices, delivery records, and proof of performance or non-performance - A clear computation of the amount claimed, including interest - Any expert material you intend to rely on Organise chronologically and be selective. A tribunal reading a focused bundle is more likely to follow your case than one working through everything you possess. ## Step 5: The procedural hearing Early in the arbitration the tribunal will hold a procedural hearing to fix the timetable — dates for statements of claim and defence, document production, evidence and hearings. Engage seriously with this. The timetable set here largely determines how long the arbitration takes, and Section 29A requires the award within 12 months of the tribunal's constitution. ## Interim relief If you need urgent protection — preserving property, restraining a payment — the tribunal can grant interim measures under Section 17, enforceable as orders of the court. Before the tribunal exists, a party can apply to court under Section 9. ## Settlement remains available Arbitration and settlement are not mutually exclusive. Parties frequently settle during arbitration, and where they do, the tribunal can record the settlement as an award on agreed terms under Section 30 — which carries the same enforceability as any other award. If a negotiated outcome would serve you better than a contested one, that route stays open throughout. ## After the award The award is binding and enforceable as a court decree under Section 36 once the challenge window closes. See the guide on what happens after settlement for the enforcement process, and the arbitral award glossary entry for the types of award and the narrow grounds of challenge.