Worth Richard: Arbitration Amendment Bill — First Reading 
Worth Richard: Arbitration Amendment Bill — First Reading 
[Volume:634;Page:5582] 
Dr RICHARD WORTH (National) 
: 
 May I start by commending the Associate Minister of Justice for the recitation he has given on the Arbitration Amendment Bill. 
Darren Hughes 
: What a greaser. 
Dr RICHARD WORTH 
: Without wanting to be critical of what he has said and prompted by the young immature junior whip of the Labour Government I simply note that his pronunciation of “arbitral” perhaps requires some further practice. 
Hon Clayton Cosgrove 
: I didn’t go to the right school obviously. 
Dr RICHARD WORTH 
: It is not a question of not going to the right school and I am not certain what the right school is. I think the problem that the Minister confronts is that these are not issues on which he has any real knowledge at all. 
I think it is also important to note in the comments I make at this stage of the bill that this legislation has not been given any degree of urgency by the Government. As the previous speaker has said it was patterned on Law Commission report No. 83  
Improving the Arbitration Act 1996 
 and when the Government responded to that Law Commission report—as it was obliged to do—it made it very clear that these issues did not need to be accorded any degree of urgency. 
Although National supports the passage of this bill to the select committee we do so subject to some reservations that some of the changes that are proposed may in fact not be necessary. I just flag that as a possibility and the select committee that looks at this legislation will have to form a view on the merits of the proposed changes. 
There are of course a number of ways of resolving disputes without resorting to fisticuffs and warfare. One could broadly say that those possibilities in a regulated civil society include conciliation mediation arbitration and finally resolution by the courts. Conciliation of course means what it says. Mediation as a concept does not carry with it the consequence that if rulings are made views are expressed or positions are reached they will be binding on the parties. That is seen in many cases as a significant disadvantage. In the case of arbitration we are talking about a process that is consensual in that the parties come to it of their own free accord. But more important they accept the ruling of the arbitrator as being binding subject to some very limited avenues for appeal to the courts. It is interesting that although arbitration is seen as a method of resolution outside the normal legal system it is nevertheless regulated by that system in terms of limited rights of appeal and other interlocutory orders that can be made in the course of an arbitration process. 
It is probably also worthwhile reflecting that the Arbitration Act itself had its origin in initiatives taken by Peter Hilt a former member of this House who in 1996 introduced the Arbitration Bill which was based on a report prepared by the then Law Commission. As the previous speaker said the Act repealed and replaced the Arbitration Act 1908—that Act having been modelled on English arbitration procedures. The new model that was picked up—reflecting the international aspect of arbitration—was based on the model developed by the United Nations Commission on International Trade Law. 
The general policy statement in the explanatory note of the bill asserts the underlying themes of the Arbitration Act 1996 as including party autonomy reduced judicial involvement in the arbitral process consistency with laws in other jurisdictions and increased powers for the arbitral tribunal. That is not necessarily an accurate or an appropriate statement as to what those themes were because it is only partly true to talk about party autonomy as being an essential hallmark of arbitration. The reality is that with the complexity of many arbitrations these days and often their international aspects the arbitrator stands firmly in the path of the resolution process directing and encouraging the parties by various orders to advance their causes identifying clearly the issues and seeking to limit aspects of delay. 
It is right to say that there is reduced judicial involvement in the arbitral process but there is some involvement. Consistency with laws in other jurisdictions is asserted as a theme of the Arbitration Act 1996; I do not really think that is correct. Increased powers for the arbitral tribunal is also a problematic assertion because of course it has always been for the parties to assert the rules of procedure that they would like to govern the particular arbitration that faces them. 
I commend the Government for one aspect of this bill and hope it might be seen to be a practice to be followed in the future. In the explanatory note there is both a regulatory impact statement however inadequate it might be and a business compliance cost statement. Those requirements or concepts have their base in the step-by-step Cabinet guide and too often it seems to me it is the case that the Government seeks to rely on the many exceptions that are in existence to require that neither of those statements be made. It should surely be the case that the Cabinet guide is amended so that there is on a case by case basis an examination in terms of both the regulatory impact of a provision and also the business compliance cost implications. We are faced I would say with a Government that too often pursues its ideological policy positions without consideration of what the impact of the law will be—that is the proposed law that is before Parliament in the form of a bill—and particularly of what its fiscal consequences not only for the State but for the parties who are impacted by the legislation might be. 
So what of this legislation itself? As the Minister has said it is in two parts: some technical amendments to the Arbitration Act 1996 and some changes to be made to the Disputes Tribunals Act 1988. I would say in reference to just the first part—the amendments to the Arbitration Act—that some of the issues identified are also somewhat problematical. The reality is that in the market place there may often not be equality of bargaining power in the buyer-seller relationship and I am speaking particularly of consumer protection provisions which are the subject of some tinkering by this legislation. It is said that the bill improves the level of protection provided to consumers who enter into consumer arbitration agreements. Those agreements will no longer need to be signed at the same time as entering into a contract with a business. Of course they do not need to be signed now so exactly what the purport of that change is is not completely clear. But the bill proposes that an arbitration agreement between a consumer and a business takes effect only if arbitration has been specifically agreed to as a means of resolving a dispute after the dispute has arisen. 
There are changes around the question of disclosure of confidential information. If anything is a hallmark of the arbitration process it is the confidentiality of that process. It is often said that as a result of the increasing trend towards arbitration there is a limited flow of published legal principle of decided cases because the parties have taken the position that they would much prefer to see their issues resolved by arbitration not through the greater openness of the court process. 
So it is not the case that National commends this legislation; it is that we are happy for it to take a further step down the parliamentary path.