Cautious welcome for Faculty’s new arbitration scheme

The Faculty of Advocates’ arbitration service, due to launch with two pilot cases in May, has received a mixed response from solicitors.

Angela Grahame QC, Vice-Dean of Faculty told The Herald the new service “is interested in all sorts of arbitration”.

She added: “We see personal injury arbitration as a hub and there will be spokes coming off that hub.

“Some will be commercial arbitration, family arbitration, construction – all sorts of things. We’re even talking about equestrian arbitration.”

Ms Grahame said arbitration is generally cheaper and can reduce the time it takes to solve a dispute.

“Computer software will give both parties 24-hour access to documents and they will be able to email the arbitrator to ask them to decide on the issues in dispute,” she said.

“People all over Scotland will be able to do this online and they will never have to wait in court for a judge or have to wait in a queue to have cases heard before theirs.”

But the news has received a mixed response from law firms whose business models are based on litigation.

Liam Entwistle, chief executive of Wright, Johnston & Mackenzie, and a dispute resolution specialist, said the move was “encouraging”.

He added: “It’s good to see the Faculty endorse, in such an emphatic way, ways of resolving disputes that don’t rely on litigation in a court.

“It must also be seen as a real recognition of our strong, but developing, arbitration offering in Scotland.”

Fraser Oliver of Digby Brown warned that arbitral decisions will not affect the common law.

Mr Oliver said: “While arbitration may have a role to play in a small number of personal injury cases, we see access to the courts as the most important route to justice for our clients.

“In a recent review of litigation funding the concept of compulsory arbitration . We would not wish to see a situation where the well-resourced insurance industry might seek to introduce compulsory arbitration by the back door by arguing that court costs should not be recoverable unless arbitration has been attempted.

“The privatisation of the law in this way would not be in the interests of the vast majority of accident victims. Our clients require the courts to administer the rule of law to provide access to justice.”

Ms Grahame, however, said new means of dispute resolution are “clearly in clients’ best interests”.

“One of the concerns is that firms have business models that are set up for litigation, so how can they secure their business? But that assumes that you won’t be able to make money from arbitration,” she added.

“Insurers are keen on this and lots of pursuer firms have expressed an interest. The Faculty is really keen on doing this - we’re definitely doing it.”