Wagner Nicky: Arbitration Amendment Bill — First Reading 
Wagner Nicky: Arbitration Amendment Bill — First Reading 
[Volume:634;Page:5588] 
NICKY WAGNER (National) 
: 
 The Arbitration Amendment Bill is designed to improve the operation of the Arbitration Act 1996. Arbitration is an effective method of dispute resolution which involves the settlement of a dispute by an independent person appointed mutually by conflicting parties. The use of arbitration has increased markedly over recent years and although there are no statistics on the total number of arbitrations the number of defended civil cases filed in the High Court dropped by 40 percent between 1999 and 2003. This would seem to indicate that parties prefer arbitration before proceedings reach court and anecdotal evidence tells us that the cost and the speed of arbitration are attractive. 
The amendments in this bill are designed to encourage further the use of arbitration as a means to resolve disputes privately in New Zealand. National fully supports this aim and the use of arbitration as a means to streamline and manage the cost and timeliness of dispute resolution in civil proceedings. The use of arbitrators who have technical skills or qualifications adds another valuable facet to this method of dispute resolution. 
The bill’s amendments to the Act are based on the recommendations made by the New Zealand Law Commission’s report of 2003. Although in that report the Law Commission concluded that the 1996 Act was generally working well several problems were identified that if addressed could significantly improve the operation of the law. As most arbitration is for private commercial or contractual disputes confidentiality is considered to be one of arbitration’s major attractions. But the Law Commission identified two issues concerning confidentiality—the default rule and the open justice issue—that the commission recommended should be refined. 
The default rule is concerned with the original section 14 of the 1996 Act. Under the Act all arbitral proceedings are closed and confidential but for two exceptions. The first exception is where the parties otherwise agree. The second exception permits disclosure of such information to a professional or other adviser of any party if the publication disclosure or communication is contemplated by the Act. 
These present exceptions are very narrow and do not permit disclosure of information to interested parties—for example a professional or other adviser of one of the parties—disclosures required by law or by a competent regulatory body but not contemplated by the 1996 Act or disclosures for other legitimate reasons such as the filing and prosecution of any application to a District Court or to the High Court. The Law Commission considered the clause “if the publication disclosure or communication is contemplated by the Act” to be unduly vague and it required clarification—a task for the select committee. 
The open justice issue concerns the idea that confidential provisions should not extend to proceedings outside the arbitration process and in particular to subsequent court proceedings. The bill clarifies that as a general rule arbitral proceedings are private and confidential while court proceedings are to be conducted in public. But exceptions may occur and applications could be made to the court. This is another area that needs select committee scrutiny as it is important that we find the right balance between party autonomy and open justice. 
Finally another area that needs close scrutiny involves the provisions for selecting an arbitrator in cases of conflict between the parties as confidence in the arbitrator selected is fundamental to the process. National supports this bill in its attempt to improve the 1996 Act and as a first step in the process to find the most cost-effective and efficient way to resolve disputes. Thank you. 
Bill read a first time. 
Bill referred to the Justice and Electoral Committee.referred to Justice and Electoral Committee