Originally From Arbitration Law of Sweden: Practice and Procedure

INTRODUCTION

1.1 General characteristics of arbitral procedure

The parties to a contract can agree that disputes between them are to be settled by arbitrators and not by the national courts. Arbitration is a form of private adjudication. This exception to the state monopoly of administration of justice is explained by the principle of freedom of contract. The law allows parties to regulate their mutual dealings through agreements and by the same token accepts their agreement to let a third party resolve a dispute. Unlike many other forms of private adjudication, e.g., decision-making by consumer complaints boards, performance awards by arbitrators are enforceable as court judgments.1 What is more, an arbitration award has legal force and res judicata effect. A court may not re-adjudicate the dispute against the respondents’ objection.2 An arbitration agreement made by the parties must be respected by them, and the courts shall contribute to this end. Thus, at the request of the respondent a court is obligated to dismiss a dispute coming under an arbitration agreement.3

An arbitration award cannot be appealed on the merits of the case, e.g., if the losing party considers that the arbitrators have misinterpreted a contract clause or have evaluated the evidence incorrectly. This expedites the resolution of disputes, which is an advantage, not least to the claimant. However, the absence of any right of appeal of a case on the merits involves a risk. A party has to respect an award even if it is substantively incorrect. The state does not assume any responsibility for the correctness of arbitration awards or for the advisability of entering into an arbitration agreement. Responsibility for the expertise and impartiality of the arbitrators rests primarily with the parties themselves.4

The Swedish Arbitration Act contains a limited number of provisions on the procedure. Some of them are, however, of fundamental importance, e.g., those safeguarding the impartiality of the arbitrators and the parties’ right to be given the opportunity to present their case.5