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In recent years, the number of disputes successfully resolved through arbitration has grown significantly. Arbitration clauses are now widely accepted and viable as an effective method of alternative dispute resolution in Thailand.
However, litigation through the Thai courts remains the most common form of dispute resolution. Positive steps are being taken by the government to promote and facilitate out of court arbitration proceedings.
Litigation in Thailand is largely an adversarial system. The court’s role is to determine the truth of the matter and make decisions on procedural matters during the trial, as well as conduct investigations if needed. Courts are often overloaded with cases, leading to significant delays in the case resolution process.
Most Thai people try to avoid litigation whenever possible. They fear that seeking legal recourse will disrupt business relations, increase their costs and generally lengthen the time before a dispute is resolved. However, in some instances, litigation is the only way to get justice.
The timeframe of a court case depends on the number of witnesses and the trial schedule. In some proceedings, the courts may ask parties to submit written submissions and decide administrative matters before scheduling witness hearings. Witnesses are required to attend to affirm their statements and answer questions from the opposing party. Witnesses are also subject to cross-examination and re-examination.
In the case of a class action, the courts use an inquisitorial procedure where the court may question witnesses or evidence if the plaintiff can demonstrate that there are common characteristics among the members of the identifiable group. The court’s decision in a class action lawsuit binds all members of the identified group.
If the dispute meets the jurisdictional requirements of the court, a foreign defendant residing outside Thailand can be sued in Thai proceedings. Service of process would be made via international courier or through diplomatic channels, depending on the specifications of any applicable bilateral treaties and law.
In Thailand, arbitration is a popular method of Thailand dispute resolution because it offers a more expedient and predictable solution than litigation. The arbitration institute typically schedules a meeting with disputing parties to establish the timeline of the proceedings, decide on evidence and procedure matters, and officially designate the tribunal. Arbitration proceedings are also less expensive than litigating in court.
Although out-of-court arbitrations usually take one year on average to settle disputes, parties can speed up the process by requesting an emergency arbitration. The tribunal has the discretion to grant interim remedies, but is likely to consider such measures only if a valid case is presented. However, a court will only enforce an arbitral award if it is in line with Thai law.
If a claimant presents a case with a seemingly legally enforceable arbitration clause before a Thai court, the court will conduct an inquiry hearing to determine whether the agreement is in accordance with the provisions of the Arbitration Act. It is rare for the courts to refuse to enforce an arbitration award.
In cases where the courts decide not to enforce an arbitral award, they can review and confirm the award based on limited grounds as specified under Section 43 of the Arbitration Act. This gives the tribunal a wide scope of discretion, and it represents a significant milestone for Thailand in becoming an arbitration-friendly jurisdiction.
The process of conciliation involves a neutral mediator helping the disputing parties in the dispute to reach an acceptable solution. It is often used in resolving smaller claims and it can be cheaper than litigation. It also allows for a more efficient resolution, as it is usually done within a shorter timeframe than that of a trial.
Conciliation is a popular alternative to litigation in Thailand and can be conducted at the civil courts, labour court, family court, juvenile court and the Central Intellectual Property and International Trade Court. It differs from arbitration in that a judge does not assess the case, unlike in a trial, but is only present to supervise the proceedings. The presiding judge may question witnesses and the evidence presented by both sides of the case. In a case of conciliation, the disputing parties can either designate their own mediator or make use of a mediator from the Thai Mediation Center.
In addition, the judiciary in Thailand is well-developed to ensure a balance of power. If a party disagrees with a court’s order or judgment, they can appeal it to the Court of Appeal or the Supreme Court, which allows for a full review of the matter. Further, the Thai legal system provides a mechanism to investigate judges for misconduct, ensuring checks and balances.
Unlike arbitration and litigation, mediation is less formal and nonadversarial. It involves a neutral third-party, called the mediator, who facilitates dialogue between parties and helps them reach an agreement. Court officials in Thailand actively encourage mediation and the country’s legal system supports its use for various types of disputes.
Mediation is often used in disputes involving smaller amounts because it can be cheaper than litigation. In addition, it can speed up the resolution process as opposed to the lengthy, complicated, and time-consuming trial proceedings typically required by a judge in a traditional case.
The Court of Justice has long recognized the value of alternative dispute resolution (ADR) and its benefits to judicial resources, especially in tackling heavy caseloads and reducing delay. The ADR system, particularly court-annexed mediation, is one of the most effective means for the judiciary to deal with backlogs and reduce case processing times.
The Court of Justice is working towards a policy that promotes ADR as an essential part of the court system in order to reduce delays and the burden on courts and litigants. It will allow judges to appoint conciliators for cases that have been filed or are being processed in the court and also enact legislation to facilitate hybrid dispute resolution mechanisms like Arb-Med-Arb, which provide both a binding arbitration decision and a negotiated settlement that is recorded in an enforceable contract under Thai law.
