Top tips for preparing for arbitration in healthcare disputes
Offering confidentiality, flexibility and being able to obtain a final and binding decision without involving the courts, arbitration is a form of alternative dispute resolution favoured by the healthcare sector.
What is arbitration?
Arbitration is a formal alternative dispute resolution process that bears some similarity to court proceedings.
An arbitrator acts as a neutral third party and usually has some expertise in the area of the dispute. As with a court judgment, an arbitrator's decision is final and binding on the parties. However, unlike court proceedings, parties can exercise control over an arbitration process. The parties can select the arbitrator or panel of arbitrators, decide the arbitrator's powers, and determine the procedure that will be followed - this may be set out in a free-standing arbitration agreement or, more commonly, in a clause within a broader agreement, such as a partnership agreement.
Why use arbitration?
Many partnership agreements contain drafting requiring partners to use arbitration to resolve disputes. The agreement may refer solely to arbitration or may contain 'stepped' dispute resolution procedures. For example, requiring partners to attempt mediation before commencing arbitration proceedings. If a dispute arises, it's always important to read your partnership agreement at an early stage to help you understand your legal position and the process that needs to be followed.
Arbitration is becoming a popular mechanism for resolving healthcare disputes due to its ability to provide a final and binding decision, its flexibility, and its potential to be more cost-effective and quicker than court proceedings. Parties can require that the dispute be handled by someone who has some expertise in the area of the dispute. Arbitration is also normally confidential, meaning that it is a good option if parties are keen to avoid publicity or wish to prevent the subject matter of the dispute from entering the public domain.
Our five top tips
1. Check time limits
As with commencing proceedings in court, there are statutory time limits that apply in respect of bringing a claim through the arbitration process. It is initially important to check whether the claim is time-barred. It is also crucial to check the applicable arbitration agreement or clause as this may set a time limit for commencing arbitration and/or incorporate standard arbitration rules of an established body that impose a certain time frame.
2. Seek appropriate specialist advice
Arbitrators are neutral third parties and cannot provide legal advice. This means that it is crucial to seek independent legal advice before the commencement of arbitration proceedings to understand your legal position. Solicitors can support you by drafting and advising on any necessary documents (for example in relation to case management, disclosure, written submissions, and witness statements), and representing you during arbitration hearings.
3. Consider mediation
Even if your partnership agreement does not require you to attempt mediation before commencing arbitration, it is worth considering whether mediation may be appropriate as a first step. It may be beneficial to see whether parties can resolve the dispute through constructive discussion and compromise to ensure a mutually beneficial resolution. For further information on mediation in healthcare disputes, please see our recent article.
4. Check how to commence arbitration proceedings
Normally, arbitration is initiated by one party sending a written request or notice to the other party or parties. Parties should check the arbitration agreement/clause and any standard arbitration rules that have been incorporated as these will normally set out the procedure that must be followed. If there are no specific provisions, parties will need to comply with the process set out in the Arbitration Act 1996.
5. Select the arbitrator carefully
If parties can select the arbitrator, we recommend that an arbitrator who has expertise in the subject matter of the dispute be chosen to minimise preparation costs and to give parties more confidence in the handling of the dispute.