Arbitration

Society of Chartered Surveyors Ireland Arbitration/Independent Expert Appointments Function

When rent reviews arise under commercial leases, the landlord and the tenant will have usually chosen arbitration as the method for resolving a dispute in relation to the assessment of the revised rent. Very often leases provide that the Arbitrator will be a Chartered Surveyor and whilst frequently the parties may be able to agree upon a suitable third party to act as Arbitrator the majority of commercial leases provide that in default of agreement the Arbitrator will be appointed by the President of the Society of Chartered Surveyors Ireland.

http://medi-kids.info/dispute_resolution/procedures/rent_review

In this regard, the Society of Chartered Surveyors maintains a panel of Arbitrators and a panel of Independent Experts to which the President may refer when making appointments/nominations under the terms of rent review clauses in leases, where third party intervention is sought

What is Arbitration?

Arbitration is a process whereby two parties in dispute agree to be bound by the decision of an independent third party acting as an ‘Arbitrator’. An Arbitrator is similar to that of a judge, though the process is less formal. They hear the evidence and arguments submitted by the parties and reach a final decision which is called an ‘Award’.

Sometimes the lease will provide for the appointment of an ‘Independent Expert’.

The Independent Expert may also receive evidence and listen to arguments but unlike the Arbitrator they can make their own investigations to work out the appropriate rent and reach a decision called a ‘Determination’.

The legislation governing the Arbitration Process in Ireland is the Arbitrations Act 2010 and subsequent amendments.

The benefits of using Arbitration to resolve disputes are:

  • It is a fair and informal process

  • It is an expedient method of addressing and resolving disputes

  • It is a cost effective way of settling disputes without having to go to court.

Appointments of Arbitrators

When parties in dispute are unable to agree a third party themselves, an application can be made to the President of the Society of Chartered Surveyors Ireland to make a suitable appointment.

This application form together with a copy of the lease/s is used to assist the President in making the appointment/nomination. A copy of this application form will be sent to the person being considered for the appointment/nomination. This is to ensure, that there is no conflict of interest between both the appointee and the parties. The appointee can then make an informed decision as to whether he/she can act in this case. A copy of the application form will also be sent to the other party involved.

http://medi-kids.info/resources/pdf/Appointment-Arbitrator-Feb09.pdf

The President gives careful consideration and due weight to any objections or other comments made by the parties or their representatives. However, he cannot be bound by any such objections or representations and will reach his own decision as to who should be appointed.

Both parties are normally advised of the appointment/nomination as soon as it is made and on the basis that no particular problems arise, the procedure is usually completed within 4 weeks from the date of receipt of the application for the appointment of an Arbitrator/Independent Expert.

Cost of Arbitration

An administration fee of €325.00 per lease is charged by the Society of Chartered Surveyors Ireland to appoint an Arbitrator/Independent Expert.

Following completion of the appointment procedure a formal letter of appointment/nomination will be issued to the Arbitrator/Independent Expert and each party to the dispute. The Arbitrator/Independent Expert will then contact the parties to advise them of the procedures and the professional fees to be charged.

There are no guidelines on the level of Arbitrators/Independent Expert professional fees and the Society is precluded in law from setting or recommending professional fees. This is usually a matter to be agreed between the parties.

In the event that the dispute is settled before the Arbitrator/Independent Expert makes his/her decision, it is the responsibility of the parties to inform the Arbitrator/Independent Expert immediately. In this case the Arbitrator/Expert should receive a professional fee and any associated costs to cover his/her work to date.

Applications for the appointment of arbitrators/independent experts should be sent to

Gwen Wilson
Arbitrations Officer
Society of Chartered Surveyors Ireland
38 Merrion Square
Dublin 2.

Please ensure that your completed application form is accompanied by a certified copy of the lease together with a cheque of €325.00 made payable to the Society of Chartered Surveyors Ireland.

http://medi-kids.info/resources/pdf/Appointment-Arbitrator-Feb09.pdf