When a contract includes an arbitration clause, any dispute that arises must be resolved through arbitration rather than through the traditional judicial courts. This type of clause is common in commercial contracts and establishes that an arbitrator appointed by institutions such as the International Chamber of Commerce (ICC), the Mexican Arbitration Center (CAM) or the National Chamber of Commerce (CANACO) will decide on the dispute . Understanding this difference is crucial to protect your commercial rights and interests.
Why Can’t You Sue in Court if Your Contract Has an Arbitration Clause?
- Legal Binding: The arbitration clause is a legally binding agreement that excludes the jurisdiction of ordinary courts. This means that if a dispute arises, you cannot simply go to court; you must follow the process established by the clause, which typically involves arbitration under the rules of the ICC, CAM, CANACO, or other designated institution.
- Exclusive Proceedings: Arbitration is an autonomous and exclusive process that takes place outside the state court system. An arbitrator, rather than a judge, will hear the arguments and issue a final decision. This decision is as binding as a court judgment and, in most cases, is not appealable, highlighting the importance of being well prepared from the outset.
The Need for a Specialized Arbitration Lawyer
Hiring an arbitration lawyer is essential when your contract includes an arbitration clause. Here’s why:
- Commercial Arbitration Experience: A lawyer with experience in arbitration, especially under institutions such as the ICC, CAM, or CANACO, understands the particularities of these proceedings. These include the selection of the arbitrator, the presentation of evidence and the formulation of arguments according to the specific rules of the arbitral institution.
- Proper Legal Strategy: A commercial arbitration expert knows how to structure your case effectively to maximize your chances of success before the arbitrator. This knowledge includes understanding the precedents and accepted practices in commercial arbitration.
- Knowledge of Institutional Rules: The rules of the ICC, CAM, and CANACO differ in several respects, from the appointment of the arbitrator to the deadlines for filing documents. A specialized attorney will help you navigate these rules accurately, avoiding mistakes that could jeopardize your case.
What Happens if You Ignore the Arbitration Clause and Go to Court?
Attempting to take a dispute to court despite having an arbitration clause in your contract will result in your claim being rejected for lack of jurisdiction. Courts respect the autonomy of arbitration and, in most cases, will refer the dispute to the arbitration process set forth in your contract.
If your contract includes an arbitration clause, it is essential that you understand that you cannot resolve disputes in traditional courts. Instead, you should prepare for an arbitration proceeding administered by institutions such as the ICC, CAM, or CANACO. Hiring a lawyer specialized in commercial arbitration is crucial to ensure that your rights and interests are protected throughout the process.
