Arbitration and Fragmentation of the Dispute Resolution Process into Competing Arbitral and Judicial Proceedings - The Court's Role

Abstract

A question periodically arises in the context of both international and domestic commercial arbitration, as to whether a court should stay or alternatively refuse to stay proceedings in the court in order to avoid or minimise a multiplicity of proceedings – arbitral and curial – focusing on essentially the same or a related cluster of disputes. Clearly it will normally be in the interests of the parties that their dispute be consolidated in the one adjudication, and if they are party to an arbitration agreement their ex facie preference will be for a one-stop adjudication by way of arbitration. This paper examines the responses of the courts and legislatures to this and related issues, in common law jurisdictions. Topics reviewed include the consolidation of issues, the consolidation of parties, contemporary authority on the scope of arbitral clauses, the court’s statutory and inherent jurisdictions to stay proceedings, the circumstances in which non-signatories can be deemed to be party to the arbitration agreement, and the conditioning of stay orders.

Keywords: arbitration, fragmentation of dispute resolution process into competing arbitral and judicial proceedings, the court's role, compelling non-signatories to participate in arbitration, inherent jurisdiction of the court to stay or refuse to stay judicial proceedings in context of arbitration

JEL Classification: K10, K40, K41