The credit crisis and associated financial turmoil over the last couple of years has meant that businesses have had to focus increasing attention on grappling with disputes. This has kept dispute resolution lawyers in international law firms in London busy, especially at a time when deal flow for transactional lawyers has not been as steady as before. As disputes become a higher priority for clients (and a more important practice area for their legal counsel), it is crucial that the available choices in international dispute resolution – and the key factors that drive such choices – are well-understood.
Litigation or arbitration? This is the recurring choice that faces in-house counsel as to the preferred method for resolving disputes for cross-border transactions. The pros and cons of both methods have been the subject of long debate. The choice is not straightforward. Champions of arbitration espouse its flexibility and bemoan the rigidity of courts. Supporters of litigation, on the other hand, complain that arbitrators tend to compromise and ‘split the baby’. To a large extent, these arguments merely reflect the individual experiences of the lawyers voicing them. Much will depend on the geographical location of the parties and their assets.
