Arbitration under codes of conduct

When it was first established in 1973, the small claims procedure was seen as a mechanism through which consumers could enforce their rights against recalcitrant traders. In reality, the arbitration procedure has proved to be just as useful for, and used just as much by, traders and businesses as consumers. There remains one area of arbitration, however, that is specifically focused on the consumer: arbitration schemes that are run under the auspices of particular trade associations. As part of the regulation of trade practices and in the pursuit of effective measures of consumer protection, the Office of Fair Trading has encouraged the establishment of voluntary codes of practice within particular areas. It is usual to find that such codes of practice provide arbitration schemes to resolve particularly intractable problems between individual consumers and members of the association. Such schemes are never compulsory and do not seek to replace the consumers’ legal rights, but they do provide a relatively inexpensive mechanism for dealing with problems without the need even to bother the county court. Such schemes are numerous; the most famous one is probably the travel industry scheme operated under the auspices of the Association of British Travel Agents, but other associations run similar schemes in such areas as car sales, shoe retailing, dry cleaning, etc. Again, the point of such schemes is to provide a quick, cheap means of dealing with problems without running the risk of completely alienating the consumer from the trade in question.

            Although many of the trade arbitration schemes offered consumers distinct advantages, some did not and, in order to remedy any abuses, the Consumer Arbitration Act 1988 was introduced. This statute provides that, in the case of consumer contracts, no prior agreement between the parties that subsequent disputes will be referred to arbitration can be enforced. However, consumers will be bound by arbitration procedures where they have already entered into them as a consequence of a prior agreement, or have agreed to them subsequently.

ADMINISTRATIVE TRIBUNALS

Although attention tends to be focused on the operation of the courts as the forum within which legal decisions are taken, it is no longer the case that the bulk of legal andquasi-legal questions are determined within that court structure. There are, as alternatives to the court system, a large number of tribunals which have been set up under various Acts of Parliament to rule on the operation of the particular schemes established under those Acts. There are at least 70 different types of administrative tribunal and, within each type, there may well be hundreds of individual tribunals operating locally all over the country to hear particular cases. Almost one million cases are dealt with by tribunals each year and, as the Royal Commission on Legal Services pointed out in 1979, the number of cases then being heard by tribunals was six times greater than the number of contested civil cases dealt with by the High Court and county court combined. It is evident, therefore, that tribunals are of major significance as alternatives to traditional courts in dealing with disputes.