What is the median length of an international arbitration? And how does that compare to litigation in the U.S. federal courts?
In the United States, arbitration is often touted as being speedier than litigation. Although that may be true for domestic arbitration, 34% of parties that use international arbitration identify “lack of speed” as one of its “worst characteristics.” What is the median length of an international arbitration? And how does that compare to litigation in U.S. federal courts?
The median duration of an international arbitration is…
Statistics on the median duration of international arbitration, measured from commencement of a case to issuance of the final award, are readily available. The table below provides figures for five leading arbitration centers: the International Chamber of Commerce (“ICC”), the International Centre for Dispute Resolution (“ICDR”), the Hong Kong International Arbitration Centre (“HKIAC”), the London Court of International Arbitration (“LCIA”), and the Singapore International Arbitration Centre (“SIAC”).
Median Duration of International Arbitration
The median durations above range from 11.7 months to 22 months. The average of the median durations is about 15 months. Note the figures above do not account for small differences in calculation methodologies. For instance, HKIAC factored in expedited arbitrations. And none of the institutions used exactly the same time period in arriving at its calculation.
How does that compare to litigation in the federal courts?
In U.S. federal courts, statistics about median duration of cases from commencement to issuance of a first instance decision are not readily available. But statistics are available for median time between commencement and start of trial.
In 2019, for civil cases (with some limited exclusions), that figure was 27.7 months. So, even before factoring in time between trial and issuance of a decision (which can be weeks or months), it appears litigation takes longer than arbitration—almost twice as long!
Digging beneath the surface
But the numbers above do not give the full picture. The vast majority of federal court cases do not go to trial. In 2019, as many as 99.3% of civil cases concluded before trial.
Many cases are dismissed by the courts (81.5% in 2019). The rest (17.8%) are withdrawn by the parties. When factoring in cases that did not reach trial, the median time between filing and disposition in federal court is significantly lower. In 2019, it was 9.9 months.
In international arbitration, a larger proportion of cases gets to a final decision on the merits. Some reports suggest about half to three-quarters of international commercial arbitrations result in settlement or withdrawal. Early dismissals by an arbitral tribunal are very rare. So, statistically, court cases are much more likely to “finish” more quickly than international arbitrations.
How long is a piece of string?
How expeditious an arbitration is depends on the procedural choices of the parties and the tribunal. A sole arbitrator may be quicker than a panel of three in making decisions and conducting proceedings. Parties and arbitrators also determine the number of written pleadings allowed and their timetable. Lengthy briefing schedules and multiple rounds of written submissions obviously result in a lengthier arbitration.
Parties and arbitrators also decide whether to have document production. They further decide whether to have a hearing or to proceed with “documents only.” While flexibility is a key feature of arbitration, care must be taken when making procedural decisions that can add or subtract weeks or months.
A case’s complexity and the amount in dispute will also often impact procedural choices. The more complex or high value a dispute, the lengthier its process will tend to be.
For example, at the LCIA, median time between commencement of arbitration and award is 9 months for cases worth less than $1 million. But for cases between $10 million and $100 million, it is 18 months. And for cases worth more than $100 million, it is 29 months.
Arbitration tends to be speedier than federal court litigation when a matter goes all the way to trial. But court cases are more likely to finish early, by dismissal or withdrawal. Ultimately, for many parties speed isn’t everything. Getting it right is more important. A case should take the time needed to get to a decision that is sound and enforceable.
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