The differentiating factor between Litigation and Arbitration is the rule of claiming legal costs from a losing party. Today, in this article we will guide you about arbitration and the role of a lawyer, and the fee they charge.
Under the process of Arbitration, Claiming Legal or Statutory Costs is a bonus. Under arbitration, in many cases, the legal process doesn’t allow the winning party to claim full-fledged cost of proceedings. Under Arbitration the winning party has the right to claim for the cost incurred by the claimant or defendant over the case.
A UAE court has allowed the claimants to claim the court fees from the losing party. Once a favorable judgment is received, only then the court fees can be claimed along with the legal fees of a lawyer. Besides, it is discouraging for the parties who are involved in petty or trivial issues or claims.
Under trivial issues or claims, legal fees can be a major concern that allows the matter not to be taken to court. Under such circumstances, an arbitration agreement is the best way out. It will soothe the heated situation in a good way.
Here it is essential to understand that claiming a lawyer’s fee for an arbitration agreement is dependent on the wording of the arbitration. The laws and regulations of the arbitration will state the claiming fee.
In recent times, there has been a shift towards awarding legal costs to the winning party. This has brought a ray of hope and is welcomed by all quarters.
Lawyers will play a prominent role in accomplishing the task. This is an overwhelming task as it was not easy to grant legal costs to the winning side. As we all know that UAE is the central hub of international and local arbitration.
This has resulted in the establishment of an international arbitration institute on its own with a set of particular rules and regulations. Currently, there is no legal provision set established for the local arbitration law.
However, there is a body Dubai International Financial Center- London Court of International Arbitration (DIFC-LCIA). They have enabled an award of the legal and counseling fee to the winning side.
On the contrary, Dubai International Arbitration Center (DIAC) has a different stance on the lawyer’s fee. They allow the councils to fix the expense for arbitration which is allotted among the parties.
Moreover, it includes the arbitration fee but fails to cater to the legal counselor’s fee. Thus, the counselor fee remains a triggering point and is a point of concern for the UAE courts.
However, as per the recent arbitration law, a tribunal can easily determine the arbitration cost. Although it fails to mention the expenses of a lawyer that are paid by either of the 2 parties. Therefore, the matter is left upon the practitioners and the UAE courts to decide and interpret the law and its wording.
Considering the high degree of ambiguity and confusion, it is advisable to have a competent And committed lawyer in UAE on board. They can guide you with the arbitration agreement and the outcome. They will suggest a possible course of action following a favorable conclusion.
Please be informed, we suggest you to book the legal appointment first before taking any action, means going towards courts or the arbitration.