While arbitration in personal injury claims in England is well established, north of the border it is a relatively new phenomenon, but one that may be of interest to insurers as an alternative to litigation in the Scottish courts.
Although arbitration has long been an option in Scotland, it has in the past been viewed as a slow, expensive process, to the extent that it was rarely used. The Arbitration (Scotland) Act 2010 sought to change that, bringing procedures more in line with England.
While this led to an increase in commercial arbitration, the question of personal injury arbitration has only recently begun to be addressed. As of spring 2017, there will be a number of specialist Scottish PI arbitrators principally from the personal injury ranks of the Faculty of Advocate, opening up for the first time the possibility of this form of alternative dispute resolution in Scotland.
There are potential advantages for defenders to this procedure. , Parties retain a greater level of control and the procedure adopted in arbitration should mean costs are more predictable, and lower, than they would be in the courts. Failure to follow procedure to the letter does not necessarily result in prohibitive sanction. The Arbitrator will be the parties’ choice, meaning that people with an expertise in PI litigation will be deciding matters, which is not always the case, even in the All Scotland Personal Injury Court. Proponents argue that the process will be quicker, more flexible and that greater use can be made of technology.
It also means that the outcomes of decided cases are confidential and will not be binding on future cases; this of course could be a disadvantage in some cases, in which case arbitration is perhaps not the way to go.
Finally, the timetable is fixed around the parties’ requirements, rather than the courts, meaning things can progress more efficiently and quickly than otherwise might be the case.
There are however some disadvantages to consider. Going to arbitration is something all parties need to agree to, and it may be that there is some resistance from firms whose business model is based on litigation in the courts. Parties may also be loath to give up their “day in court”.
Arbitration cases will not “make law”. There is no real opportunity to appeal, and as a result, in cases where there is a principle that a party feels ought to be before the Supreme Court, then arbitration is not going to be suitable.
It can also be more difficult to compel action from non-parties, though mandates for the recovery of documents are already used in many actions, and if both parties have signed up for arbitration that should assist with such requests being progressed promptly.
Clearly it will take some time before the benefits of personal injury arbitration in Scotland are known. However, it is likely to be an area of growth in the next few years, and could prove to be an option worth considering.