MAL 23/18 MAL23:18 | Page 74

ARBITRATION Advantages Of Administered Arbitration By Wachia Kilei A rbitration is a form of dispute resolution mechanism where parties to a contract agree to refer disputes arising out of the contract to a neutral third party for determination whose decision or award will be binding to both parties, the arbitration process may be administered or ad-hoc. Administered/Institutional arbitration on the other hand is a predetermined process of arbitration whereby an Arbitral Institution develops rules and guidelines for the administration of disputes referred to Arbitration. Parties only therefore need to adopt the rules of the institution for the same to apply. The Arbitration Act, Chapter 49 of the Laws of Kenya provides that the Act will apply to Arbitrations that are either administered (by a permanent arbitral institution) or ad-hoc. An ad-hoc arbitration is one where the parties develop the framework for the arbitration by deciding the type of tribunal, composition of tribunal, applicable rules, law, seat, venue, language, nature of admissible evidence and form of award. The Nairobi Centre for International Arbitration (NCIA) is an Arbitral Institution established vide Act no. 26 of 2013 to administer international commercial arbitration and other dispute resolution mechanisms. To facilitate administration of disputes referred to arbitration, NCIA published the NCIA Arbitration (2015) rules: (www.ncia. or.ke/downloads) In Ad-hoc arbitrations, parties are required to identify an institution that will appoint the arbitrator (appointing authority) in the event that the parties fail to agree. The appointing authority responsibilities expire upon appointment and parties cannot revert back to it to determine issues arising from the appointment. The NCIA Arbitration (2015) rules provide numerous advantages to counsel and their parties such as, adoption of a model clause to suit the contractual needs and legal relationship of the parties. The NCIA model clause allows parties and their counsel to reduce the time it would have taken to develop an Arbitration Clause. Further, adoption of the clause Arbitration is a form of dispute resolution mech- anism where parties to a contract agree to refer disputes arising out of the contract to a neutral thir d party for determination whose decision or award will be binding to both parties: the arbitra- tion process may be administered or ad-hoc. 72 MAL23/18 ISSUE ensures that the dispute resolution clause is clear and concise. Additionally, adoption of NCIA sample clauses reduces the risk of uncertainty and delay in determining intention behind inadequate or overly complex dispute resolution clauses. The sample clauses are versatile and can be incorporated into different types of contracts as well as being adopted in a subsequent agreement, where the initial contract did not sufficiently provide for dispute resolution. Furthermore, adoption of the NCIA Arbitration (2015) rules ensures that the Arbitral process is managed in a timely manner as the rules provide for definite timelines for the nomination of experts to sit in the tribunal by the parties and further provides for a saving provision in the event of failure or refusal of parties to nominate members of the tribunal or agree on a sole arbitrator. The procedural guidelines set in Rule 5 and 6 of the NCIA Arbitration rules, provide direction on how to submit a request for arbitration and the response thereto together with the relevant documentation, providing parties with relevant information on the dispute to enable them seek appropriate instructions from Counsel and respond adequately. Ad- hoc arbitrations on the other hand only require parties to serve a notice of dispute to commence an arbitration process, which notice lacks the requisite information to enable the preparation of the Response or facilitate the appointment of a tribunal by