Does Arbitration Hinder the Growth of Common Law Jurisprudence?
🔍 Understanding the Basics
What is Arbitration?
Arbitration is a private dispute resolution mechanism, where parties agree to resolve disputes outside the traditional court system, usually through a neutral arbitrator.
It is confidential, speedy, and flexible, often preferred in commercial matters.
What is Common Law Jurisprudence?
Common law jurisprudence develops through judicial decisions (precedents).
Courts interpret, expand, and clarify the law by deciding real disputes.
Over time, these decisions become binding precedents, enriching the legal system.
⚖️ Core Issue
The core question is:
Since arbitration occurs outside the public court system, and arbitral awards are not published or binding as precedent, does it hinder the evolution of legal principles that normally grow through court judgments?
✅ Arguments: How Arbitration Might Hinder Common Law Growth
1. Lack of Precedents
Arbitration decisions are not published and not binding on future cases.
Therefore, they don’t contribute to building a body of law or guiding similar future disputes.
🧾 Case Example: Booz Allen & Hamilton Inc. v. SBI Home Finance Ltd.
The court distinguished between arbitrable and non-arbitrable matters, emphasizing that certain issues (like constitutional or public rights) must be decided by courts to maintain legal development.
Implication: Over-reliance on arbitration might remove such cases from the public domain where law can evolve.
2. Confidential Nature
Arbitration is private and confidential. This prevents the public or legal community from accessing awards and understanding how legal principles are applied or interpreted.
3. Limited Judicial Review
Courts have limited power to interfere with or review arbitral awards.
This can reduce the opportunity for appellate courts to clarify or develop legal doctrines.
4. Commercial Focus
Arbitration is often used in commercial disputes where parties may focus on settlement, not legal development.
This "case-by-case" mindset doesn’t contribute to broad legal principles.
❎ Counterarguments: Arbitration Does Not Hinder Jurisprudence – It Complements It
1. Reduces Burden on Courts
Arbitration reduces the load on the judiciary, allowing courts to focus on cases with wider public interest or scope for legal development.
2. Arbitration-Related Court Proceedings Still Build Jurisprudence
Courts still decide:
Whether a matter is arbitrable.
Challenges to arbitral awards.
Enforcement of awards.
These court decisions do create precedents and develop common law.
🧾 Case Example: ONGC v. Saw Pipes Ltd.
The Supreme Court widened the scope of reviewing arbitral awards on grounds of “public policy.”
This judgment had a major impact on arbitration jurisprudence and illustrates how court supervision still influences legal development.
3. Specialized Knowledge
Arbitration often involves technical or commercial expertise, where evolving common law may not be necessary.
For example, in construction disputes, commercial customs may be more relevant than general legal principles.
4. Modern Arbitration Systems Recognize Precedent
Though arbitral awards are not binding precedents, reputed arbitrators often consider prior awards and court decisions to maintain consistency and fairness.
⚖️ Balanced View
| Argument that Arbitration Hinders | Argument that Arbitration Complements |
|---|---|
| No publication = no precedent | Arbitration-related court cases still create law |
| Confidential = limited access | Focuses court time on core jurisprudential cases |
| Private logic over legal principles | Specialized decisions need not develop law |
| Less judicial review = fewer legal clarifications | Courts still oversee fairness and public policy |
🧠 Conclusion
Does arbitration hinder common law development?
✔ Yes, to some extent — because it removes many disputes from public courtrooms, where legal principles would normally develop through precedent.
❌ But not entirely — because courts still engage with arbitration at key stages (e.g., enforcement, challenge), and those decisions do contribute to jurisprudence.
🔚 Final Thought
Arbitration may limit the quantity of cases feeding common law growth, but does not stop its evolution. The key is a balanced legal framework where arbitration and the judiciary coexist, with courts retaining supervisory jurisdiction to ensure fairness and legal clarity.
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