The economy of the Turks and Caicos Islands ("TCI") has seen well above average growth in the past years, notwithstanding a worldwide pandemic. The tourism sector is of course one of TCI's largest drivers of growth, however the financial services industry and high-end real estate sector have also supported economic development.
As with any economy, real financial and economic growth is accompanied by necessary and required developments to the legal system. Changes to the legal system combined with economic growth are further a recipe for an increase in litigation. While adversarial litigation in the court room is most commonly the manner in which disputes are resolved, businesses, individuals and attorneys can sometimes overlook the opportunity for disputes to be resolved through alternative dispute resolution ("ADR").
ADR in TCI has evolved considerably over the past decade. While the islands are not yet a hub for large arbitral disputes, the use of arbitration as an alternative, more affordable, private and less time-consuming form of dispute resolution in contract and commercial matters has increased. The formal introduction of mediation in civil (and, unusually, criminal) litigation matters through legislative amendments and the creation of a roster of mediators (championed by the Chief Justice) has also firmly placed mediation as a viable part of the litigation process, if parties wish to use it.
There are real benefits to resolving a dispute through arbitration, including: (1) parties to arbitration agreements have more control over the dispute litigation process, the tribunal who will decide the matter, and the choice of law; (2) the arbitration process, and arbitral decisions, to a large extent remain confidential, whereas the court process is open to the public; (3) arbitral decisions are final and binding with limited rights of appeal; and (4) arbitration can be quicker and more cost effective when compared with the court process, and (5) arbitral awards are often simpler and easier to enforce overseas.
In TCI the Arbitration Ordinance CAP 4.08 (the "Ordinance")1 governs domestic and international arbitration agreements and arbitration proceedings. There are no restrictions on what subject matter may be referred to arbitration under the Ordinance and parties are free to make a choice of law and procedure independent of the Ordinance and the Court.
The Ordinance provides for limited challenges to the choice of arbitrator or setting aside the award of an arbitrator. Section 16(2) of the Ordinance states that the Court may only remove an arbitrator or set aside an award when there is proof of misconduct or the award improperly procured.2 There are limited rights of appeal available to challenge an award.3 Pursuant to section 10 of the Ordinance, awards are further enforceable in the same manner as a judgment handed down by the Court and given the same effect.4
Given the foregoing arbitration should be an option businesses and individuals consider carefully when they litigate their disputes in TCI.
Mediation is another form of ADR that can offer advantages over the normal Court process. Mediation is usually voluntary (where the parties agree contractually to try to resolve a dispute using a mediator) but it can be court-ordered. Mediation can be used effectively in various types of matters, including civil, criminal, regulatory, matrimonial and commercial disputes. Mediation of disputes involves the parties entering into a mediation agreement and selecting (or asking a third party to appoint) an independent and impartial mediator. The outcome of mediation, if successful, will be a contractual settlement agreement. The TCI judiciary (led by the Chief Justice) introduced and brought into force the Court-Connected Mediation Rules 2021 (the "Mediation Rules") on 16th August 2021.5
The Mediation Rules apply to both civil and criminal matters in the Supreme Court and Magistrate's Court. The Mediation Rules further establish a Mediation Committee responsible for maintaining a Roster of Mediators of trained, court approved and certified mediators.6 Parties can either request mediation or be referred to mediation by the Registrar, a Magistrate or Judge.7 In the event that the parties settle some or all of the legal issues in dispute during the course of the mediation session, those terms of settlement are filed with the court in the prescribed form, and provided those terms are within the law, they form the basis for the settlement and disposition of court proceedings.8 In TCI, mediation and access to a mediator can, of course, also be accomplished without any papers being filed within the court, in cases where parties agree to conduct mediation during or before resorting to formal litigation .9
Advantages of mediation include: 1) speed 2) lower costs 3) ability to agree outcomes a Court cannot order 4) privacy 5) maintaining commercial or personal relationships that are valuable and may be damaged in prolonged litigation.
ADR, including the choice of arbitration and mediation to settle disputes is worth considering at all stages of the dispute resolution process. Savings as to costs, obtaining a quicker decision, and accessing specialized adjudicators are some of the benefits of ADR. In TCI the Arbitration Ordinance provides a framework for TCI to become the seat for more complex and numerous arbitrations. The recent introduction of the Mediation Rules and a push towards court referred mediation may also result in greater use of mediation as a dispute resolution tool in TCI.
1. Arbitration Ordinance CAP 4.08 (the "Ordinance").
2. Section 16(2), Arbitration Ordinance.
3. Section 16(2), Arbitration Ordinance.
4. Section 10, Arbitration Ordinance.
5. Court-Connected Mediation Rules 2021 ("Mediation Rules") amended with effect from 15.10.21.
6. Rules 2 and 3, Mediation Rules.
7. Rule 4(1), Mediation Rules.
8. Rule 7, Mediation Rules.
9. Rule 9, Mediation Rules.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.