Chapter Three

THE STRUCTURE AND

JURISDICTION OF THE
COURTS
This chapter considers the structure and jurisdiction of the criminal and
civil courts as well as the nature of contemporary Alternative Dispute
Resolution within the Ghanaian Legal System.

The criminal justice system comprises of various courts with criminal

jurisdiction, the lowest in the hierarchy is the District Magistrate Court
and the highest is the Supreme Court. In between these courts are the
Court of Appeal, the Regional Tribunal and the Circuit Court.

OSEI BONSU DICKSON1

Barrister

Articles 125 – 133 of the 1992 Constitution and the Courts Act, Act 459, as
amended by Act 620 covers the respective composition and jurisdiction of
the Supreme Court, the Court of Appeal, the High Court, the Circuit and
District Court. This chapter also deals briefly with Alternative Dispute
Resolution (ADR) mechanisms for settling civil disputes. Upon completion of
this topic, you will master the various types of courts, their composition and
jurisdiction and ADR as it relates to dispute resolution.

1
BA (Hons), LL.B (Hons), LL.M (UG), ECNIS (Harvard) BL. Lecturer, Faculty of Law, Wisconsin International University College.
This work forms part of a larger on-going work on the Ghanaian Legal System and Contemporary Business law at Lex Mundus
& Cencla and the Center for Counseling and Legal Aid International (Cencla International). Whereas it covers the basic
essentials it is not intended to be exhaustive of the entire legal and institutional cadastre.
1.0 INTRODUCTION

The Ghanaian court system comprises the following courts in a descending

order of importance:

 The Supreme Court

 The Appeal Court
 The High Court (Fast Track Division; Commercial Division and; Land
Division; Human Right, Labour Division and the Financial Crimes
Division).
 The Circuit Court, and
 The District Court

There are, however, a number of administrative and quasi-judicial

institutions such as the National Labour Commission (―NLC‖), the National
Media Commission (―NMC‖), and Commission of Human Rights and
Administrative justice (―CHRAJ‖).

3.1 THE GHANAIAN JUDICIARY

The Constitution and the Courts Act provide for a Judiciary that is headed
administratively by a Chief Justice, and a court system that is structured into
two broad divisions, namely, the ―Superior Courts of Judicature‖ on the one
hand and the ―inferior‖ or ―Lower Courts and Tribunals‖ on the other. 2

2
The Chief Justice functions as the Administrative head of the Judiciary, with relatively wide
supervisory powers. Thus Section 104 of the Courts Act, 1993 (Act 459) for example, reserves
exclusively in the Chief Justice the power to transfer and thereby take away the jurisdiction of any
judge, magistrate or tribunal to hear and determine any pending cause or matter to another competent
judge, magistrate or tribunal be it a part-heard or a fresh matter, although, under section 104(1) of Act
459 the transfer order should be under the hand and seal of the Chief Justice. And although under
section 104(2) of Act 459 the Chief Justice in a case of urgency could order a transfer by means of a
telegraphic, telephonic or electronic communication, but section 104(3) of Act 459 required that
unless such an order was confirmed immediately by a written order signed and sealed by the Chief
Justice, it would have no effect. When a judge’s jurisdiction over any matter was taken away by the
Chief Justice, the only manner by which the jurisdiction might be restored was by another formal
transfer or retransfer under the hand and seal of the Chief Justice under section 104 of Act 459.
 The Superior Courts, consisting of the Supreme Court, the Court of Appeal,
the High Court and Regional Tribunals, are creatures of the Constitution,3
while the Lower Courts namely the Circuit Courts, District Magistrate
Courts, Judicial Committee of the National House of Chiefs; the Judicial
Committee of the Regional House of Chiefs and the Judicial Committees of
the various Traditional Councils, are creatures of the Courts Act.4

In the exercise of their judicial functions, in both civil and criminal matters, 5
all Courts are empowered to issue any orders and directions that are
necessary to enforce their judgments, decrees or orders. Indeed to cement
their judicial independence, Article 127(1) of the Constitution, provides
expressly that, in the exercise of their judicial function, the Judiciary cannot
be subject to the control or direction of any person or authority in Ghana.

3.2 THE SUPREME COURT

The Supreme Court established under the 1992 Constitution, is a Superior

Court of Record and is the highest court of the land; and it has both criminal
and civil jurisdictions.6 The Constitution empowers the Court to exercise
jurisdiction in five main areas: General, Supervisory, Appellate, Review and
Original jurisdiction. Historically, the first Supreme Court was created in the
Gold Coast under the Supreme Court Ordinance of 1876. That court
inherited the jurisdiction that the fused English High Court had under the
Supreme Court of Judicature Act, 1873 thus our Supreme Court acquired
jurisdiction in both common law and equity. 7 The Supreme Court was

3
Article 126
4
Section 29 of Act 459
5
Civil matters relate to disputes between private individuals arising from a contract or tort etc.
Criminal matters on the other hand are those matters that relate to crime or activities and which are
punishable either by a fine or imprisonment or both a fine and imprisonment.
6
The Supreme Court is also Ghana’s Constitutional court.
7
But not the review jurisdiction of the old Court of Chancery which had been transferred to the
Court of Appeal established under the Judicature Act. 1873. And since the common law court had no
review jurisdiction, the earliar Supreme Court could not be said to have inherited one under section
11 of the Ordinance.
presided over by the Chief Justice who sat with puisne judges appointed by
the Governor.

3.2.1 COMPOSITION OF THE SUPREME COURT

The Supreme Court consists of the Chief Justice and not less than nine
other Justices of the Supreme Court, but is duly constituted for its work by
not less than five Supreme Court Justices. The Chief Justice presides at
sittings of the Supreme Court and in his absence, the most senior of the
Justices of the Supreme Court presides. No person qualifies for
appointment as a Justice of the Supreme Court unless he/she is of high
moral character and proven integrity and is of not less than fifteen years’
standing as a lawyer.

3.2.2 JURISDICTION OF THE SUPREME COURT

General Jurisdiction
Article 129 of the Constitution, 1992 provides that:
(1) The Supreme Court shall be the final court of appeal and shall have
such appellate and other jurisdiction as may be conferred on it by this
Constitution or by any other law.
(2) The Supreme Court shall not be bound to follow the decisions of any
other court.
(3) The Supreme Court may, while treating its own previous decisions as
normally binding, depart from a previous decision when it appears to it right
to do so; and all other courts shall be bound to follow the decisions of the
Supreme Court on questions of law.
(4) For the purposes of hearing and determining a matter within its
jurisdiction and the amendment, execution or the enforcement of a judgment
or order made on any matter, and for the purposes of any other authority,
expressly or by necessary implication given to the Supreme Court by this
Constitution or any other law, the Supreme Court shall have all the powers,
authority and jurisdiction vested in any court established by this Constitution
or any other law.
Original Jurisdiction
Article 129 of the Constitution, 1992 provides that:
(1) Subject to the jurisdiction of the High Court in the enforcement of the
Fundamental Human Rights and Freedoms as provided in article 33 of this
Constitution, the Supreme Court shall have exclusive original jurisdiction in
(a) all matters relating to the enforcement or interpretation of this
Constitution;
(b) all matters arising as to whether an enactment was made in excess of
the powers conferred on Parliament or any other authority or person by law
or under this Constitution.
(2) Where an issue that relates to a matter or question referred to in clause
(1) of this article arises in any proceedings in a court other than the Supreme
Court, that court shall stay the proceedings and refer the question of law
involved to the Supreme Court for determination and the Court in which the
question arose shall dispose of the case in accordance with the decision of
the Supreme Court.
Appellate Jurisdiction
Article 129 of the Constitution, 1992 provides that:
(1) An appeal shall lie from a judgment of the Court of Appeal to the
Supreme Court,
(a) as of right in a civil or criminal cause or matter in respect of which an
appeal has been brought to the Court of Appeal from a judgment of the High
Court or a Regional Tribunal in the exercise of its original jurisdiction; or
(b) with the leave of the Court of Appeal, in any other cause or matter,
where the case was commenced in a court lower than the High Court or a
Regional Tribunal and where the Court of Appeal is satisfied that the case
involves a substantial question of law or is in the public interest.
(2) Notwithstanding clause (1) of this article, the Supreme Court may
entertain an application for special leave to appeal to the Supreme Court in
any cause or matter, civil or criminal, and may grant leave accordingly.
(3) The Supreme Court shall have appellate jurisdiction, to the exclusion of
the Court of Appeal, to determine matters relating to the conviction or
otherwise of a person for high treason or treason by the High Court.
(4) An appeal from a decision of the Judicial Committee of the National
House of Chiefs shall lie to the Supreme Court with the leave of that Judicial
Committee or the Supreme Court.
Supervisory Jurisdiction
Article 129 of the Constitution, 1992 provides that:
Article 132 of the Constitution confers jurisdiction on the Supreme Court to
supervise pending adjudication in any courts and by all adjudicating
authorities. In the exercise of that jurisdiction, it can issue orders and
directions including orders in the nature of habeas corpus, certiorari,
mandamus, prohibition and quo warranto for the purpose of enforcing or
securing the enforcement of its supervisory power.

Review Jurisdiction
Article 132 of the Constitution, 1992
Article 132 of the Constitution confers jurisdiction on the Supreme Court to
review its own decisions. This jurisdiction is not frequently used. It is,
however, exercised by the court only in exceptional circumstances, for
instance, in situations where the Supreme Court has inadvertently
committed a fundamental error of law, and if left uncorrected will occasion a
gross miscarriage of justice.

3.3 THE COURT OF APPEAL

The Court of Appeal is immediately below the Supreme Court but above the
High Court. It hears only cases on appeal for example from the High Court,
Regional Tribunal and Circuit Courts. It has both criminal and civil
jurisdictions but no supervisory jurisdiction and no original jurisdiction.

COMPOSITION OF THE COURT OF APPEAL

Article 136 of the Constitution, 1992 provides that:
(1) the Court of Appeal consists of:
(a) the Chief Justice,
(b) not less than ten Justices of the Court of Appeal, and
(c) such other Justices of the Superior Court of Judicature as
the Chief Justice may by writing signed by him, request to sit in the Court of
Appeal for any period.

CONSTITUTION OF THE COURT OF APPEAL

The Court of Appeal is duly constituted by any three of its Justices and
when so constituted, the most senior of the Justices presides.
No person qualifies for appointment as a Justice of the Court of Appeal
unless he is of high moral character and proven integrity and is of not less
than twelve years standing as a lawyer. The Court of Appeal is not bound by
its own precedents, and all courts below it are bound to follow its decisions
on questions of law.

JURISDICTION OF THE COURT OF APPEAL

Article 136 of the Constitution, 1992 provides that:
(1) The Court of Appeal has jurisdiction throughout Ghana to hear and
determine, appeals from among others judgments, decrees or orders of the
High Court and Regional Tribunals. In general, an appeal lies, as of right,
from a judgments decrees or orders of the High Court and Regional Tribunal
to the Court of Appeal; and for the purposes of hearing and determining the
appeal the Court of Appeal by law` assumes all powers, authority and
jurisdiction vested in the Court from which the appeal emanates.
The court of appeal, is the final court of appeal in election petitions.8

3.4 THE HIGH COURT

In a descending order of importance, the High Court is next court after the
Court of Appeal. The Court has both criminal and civil jurisdictions. Within
the High Court, there are, however, specialized divisions, namely the Fast
Track, Commercial, Finance, Land, Industrial/Labour, and Human Rights
Divisions.

8
See In re Parliamentary Election For Wulensi Constituency; Zakaria v.Nyamikan (2003-2004)
SCGLR 1
COMPOSITION OF THE HIGH COURT

Article 139 of the Constitution provides that:

The High Court consists of:
(a) the Chief Justice,
(b) not less than twenty Justices of the High Court, and other
Justices of the Superior Court of Judicature as the Chief Justice by writing
signed by him, request to sit as a High Court Judge.

CONSTITUTION OF THE HIGH COURT

The High Court is constituted by
(a) a single Justice of the Court;
(b) a single Justice of the Court and jury;
(c) a single Justice of the Court with assessors; or
(d) three Justices of the Court for the trial of the offence of
high treason or treason as required by article 19 of this
Constitution.
No person qualifies to be appointed as a High Court Judge, unless he is a
person of high moral character and proven integrity and is of at least ten
years’ standing as a lawyer.

JURISDICTION OF THE HIGH COURT

1. The High Court exercises original jurisdiction in all civil and criminal
matters, and other appellate jurisdiction conferred on it by law.
2. It has appellate jurisdiction in any judgment of the Circuit Court in
criminal matters, and appellate jurisdiction in any judgment of the District
Court or Juvenile Court;
3. The High Court also has exclusive jurisdiction to try acts of piracy; 9 and
enforce the Fundamental Human Rights and Freedoms guaranteed by
the Constitution. In a high treason or treason trial, the High Court has
only power to convict a person for high treason or treason, and

9
See S.21 of Act 459
4. The High Court exercises supervisory jurisdiction over all lower courts
and adjudicating authorities, and in its exercise of that jurisdiction, it can
issue orders and directions for enforcing its supervisory powers. And for
hearing and determining appeals assume all the powers, authority and
jurisdiction vested in the Court from which the appeal emanates.
5. In relation to its jurisdiction in relation to infants or persons of unsound
mind
(1) High Court may
(a) on an application by a person, and after hearing the
objections to the application, appoint a person as a guardian or
as joint-guardian for an infant, make an order concerning the
custody of an infant, the right of access to an infant, and weekly
or other periodic payments towards the maintenance of an infant,
or may, remove a guardian or joint-guardian and appoint a new
guardian or joint-guardian; or may, in respect of an infant or
person of unsound mind, make the orders and give the directions
for the control and administration of the estate of that infant,
including the investment of money, that the Court considers
desirable having regard to the welfare of the infant; make the
orders and give the directions permitting the use of moneys for
the education of the infant, or for setting the infant up in an
occupation or a career, that the Court considers desirable having
regard to the welfare of the infant.
6. In relation to its jurisdiction in maritime matters
(1) The High Court may, hear and determine
(a) questions as to the title to, or ownership of, a ship, or the
proceeds of the sale of a ship, arising in an action relating to
possession, salvage, damage, necessaries, or wages; and

(b) questions arising between the co-owners of ships

registered in Ghana as to ownership, possession, employment
or earnings of that ship, or a share of it, with power to settle an
account outstanding and unsettled between the parties in
 relation to it, and may direct the ship, or a share of it, to be
sold, or make an appropriate order.

The Commercial Court

In fact, in order to make it easier for local and foreign investors can enforce
their rights in Ghana the judiciary in 2005 set up Commercial Courts (a
division of the High Court) whose function is essentially to adjudicate on
commercial matters only. Special rules govern proceedings at the
commercial courts, notable among which is the 30 day compulsory
mediation. The judges who sit in the commercial court have been specifically
trained to mediate disputes and this has gone a long way to resolve disputes
that would otherwise have taken so much time and money to resolve.

3.5 THE REGIONAL TRIBUNAL

The Regional Tribunal was first created by the 1992 Constitution and
is the court immediately after the Court of Appeal. The Tribunal has
both criminal and civil jurisdictions and also co-ordinate jurisdiction
with the High Court.

3.6 3.5.1 COMPOSITION OF THE REGIONAL TRIBUNAL

In terms of Article 142 of the 1992 Constitution, the Regional Tribunal
consists of:
(a) the Chief Justice,
(b) one Chairman, and
(c) members who may or may not be lawyers designated by
the Chief Justice to sit as panel members.

3.7 3.5.2 CONSTITUTION OF THE REGIONAL TRIBUNAL

A Regional Tribunal in the exercise of its original jurisdiction is duly
constituted by a panel consisting of the Chairman and not less than
two and not more than four other panel members. No person
qualifies to be appointed as a Chairman, unless that person is
 qualified to be appointed a Justice of the High Court; and no person
qualifies to be appointed a panel member unless that person is a
person of high moral character and proven integrity. The Chief
Justice or a Justice of the High Court or of the Court of Appeal
nominated by the Chief Justice can sit as Chairman.

3.5.3 JURISDICTION OF THE REGIONAL TRIBUNAL

Articles 142-143 of the Constitution and Section 24 of Act 459
Regional Tribunal has concurrent original jurisdiction with the High
Court in criminal matters, but has no civil or supervisory jurisdiction.
The jurisdiction of the Tribunal is spelt out in detail in Articles 142-
143 of the Constitution, for example, the Tribunal has jurisdiction to
try offences specified under the following statutes — Chapter 4 of the
Criminal Code, 1960 (Act 29); the Customs, Excise and Preventive
Services Management Law, 1993 (P.N.D.C.L. 330)], the Income Tax
Decree, 1975 (S.M.C.D. 5); the Narcotic Drugs (Control,
Enforcement and Sanctions) Law, 1990 (P.N.D.C.L. 236)] and
any other offence involving serious economic fraud, loss of
State funds or property. A Regional Tribunal however is permitted by
law to try criminal offences requiring the participation of a jury or
assessors. The decisions of a Regional Tribunals rest upon the
majority opinion of the members hearing the case. Appeals against
the decisions of the Tribunal go directly to the Court of Appeal.

3.8 THE CIRCUIT COURT

This court is located immediately below the High Court and Regional
Tribunal but above the District Magistrate Court. The Circuit has both
criminal and civil jurisdictions and forms part of the inferior or lower
courts.

3.8.1 JURISDICTION OF THE CIRCUIT COURT

Section 42 of Act 459
The Courts Act provides that the jurisdiction of the Circuit Court
consists of:
 (a) Original jurisdiction in civil matters;
(i) in personal actions arising under a contract or a tort, or
for the recovery of a liquidated sum of money, where the
amount claimed is not more than 100 million cedis;
(ii) in actions between a landlord and a tenant for the
possession of land claimed under a lease and refused to
be delivered up;
(iii) in [causes and matters] involving the ownership,
possession, occupation of or title to land;
(iv) to appoint guardians of infants and to make orders for
the custody of infants;
(v) to grant in an action instituted in the Court, injunctions or
orders to stay waste, or alienation or for the detention
and preservation of property which is the subject matter
of that action, or to restrain breaches of contract, or the
commission of a tort;
(vi) in claims of relief by way of interpleader in respect of
land or any other property attached in execution of an
order made by a Circuit Court;
(vii) in applications for the grant of probate or letters of
administration in respect of the estate of a deceased
person, and in [causes and matters] relating to
succession to property of a deceased person, who had,
at the time of death, a fixed place of abode within the
area of jurisdiction of the Circuit Court, and the value of
the estate or property in question does not exceed 100
cedis; and
3.6.2 Criminal Jurisdiction of the Circuit Court
Section 43 of Act 459
A Circuit Court has original jurisdiction in criminal matters other than
treason, offences triable on indictment and offences punishable by
death.

3.6.3 Appeals from the Circuit Courts

Section 44 of Act 459
(1) A person aggrieved by a judgment of a Circuit Court in a civil
action may, subject to this Act and the Rules of Court, appeal to the
Court of Appeal.
(2) A person aggrieved by a judgment of a Circuit Court in a criminal
trial may, subject to this Act and the Rules of Court, appeal to the
High Court.

3.7 THE DISTRICT COURT

Section 45 of Act 459
These are Courts that are set up by the Chief Justice in respective
Districts of the country. District Court has both criminal and civil
jurisdictions and are presided over by Magistrates who are
appointed, subject to the approval of the President, by the Chief
Justice on the advice of the Judicial Council. However, a person
does not qualify to be appointed a Magistrate of a District Court
unless that person is of high moral character and proven integrity
and is a lawyer of not less than three years’ standing.

3.7.1 CIVIL JURISDICTION OF THE DISTRICT COURT

Section 47 of Act 459
A District Court has civil jurisdiction in the following matters:
(a) Personal actions arising under a contract or a tort for the
recovery of a liquidated sum of money where the
amount claimed does not exceed ten million cedis;
(b) Granting of injunctions or orders to stay waste or
alienation, or for the detention and preservation of
property which is the subject matter of that action, or
restrain a breach of contract or the commission of a tort;
(c) Claims for relief by way of interpleader in respect of land
or any other property attached in execution of [a decree]
[an order] made by the District Court;
(d) Civil actions relating to the landlord and tenant of
premises, or a person interested in the premises as
 required or authorised by a law relating to landlord and
tenant;
(e) Actions relating to ownership, possession or occupation
of land, where the value of the land does not exceed ten
million cedis;
(f) Divorce and other matrimonial [causes or matters] and
actions for paternity and custody of children;
(g) Applications for grant of probate or letters of
administration in respect of the estate of a deceased
person, and in [causes and matters] relating to
succession to property of a deceased person, who had
at the time of death a fixed place of abode within the
area of jurisdiction of the District Court and the value of
the estate or property in question does not exceed ten
million cedis; and
(h) hear and determine charges and dispose of any other
matters affecting juveniles, that is persons under the
age of eighteen.

3.7.2 CRIMINAL JURISDICTION OF THE DISTRICT COURT

Section 48 of Act 459
(1) In criminal matters, a District Court has jurisdiction to try
summarily:
(a) an offence punishable by a fine not exceeding five
hundred penalty units or a term of imprisonment not
exceeding two years or both the fine and the
imprisonment;
(b) any other offence, except an offence punishable by
death or by imprisonment for life or an offence declared
by an enactment to be a first degree felony, if the
Attorney-General thinks that the case is suitable to be
tried summarily, considering
(i) the nature of the offence,
 (ii) the absence of circumstances which would render the
offence of a grave or serious character, and
(iii) any other circumstances of the case;
(c) an attempt to commit an offence to which
paragraph (a) or (b) applies;
(d) abetment of or conspiracy in respect of that offence.

3.8 THE JUVENILE COURT

The Juvenile Court is a specialized District Court that hears and
determines actions under the Children’s Act 1998(Act 560). It have
both criminal and civil jurisdictions jurisdiction in matters concerning
parentage, custody of children, access to and maintenance of
children. It hears cases concerning children in need of special care
and protection. It can make care and supervision orders. The Tribunal
sits with a panel consisting of a chairman and not less than two
members, one being a Social Welfare Officer.

3.9 THE FAMILY TRIBUNAL

The Family Tribunal hears criminal or civil cases involving persons
under the age of eighteen (18) years. The court is constituted by a
District Magistrate and two other persons, one of whom must be a
Social Welfare Officer. The Chief Justice designates a District Court
Judge to preside over the court.

3.10 THE MOTOR COURT

The Motor Court is a specialised District Court created and mandated
to handle motor traffic cases. It is therefore a special court for motor
offences and traffic violations.

3.11 THE CHIEFTAINCY TRIBUNAL

Under the 1992 Constitution chieftaincy disputes are to be heard by

the Judicial Committees of the Traditional Authorities. Matters heard
by Traditional Councils can be appealed to the Regional House of
 Chiefs and a further appeal to the National House of chiefs. The
Supreme Court serves, however, as the final court of appeal for all
Chieftaincy Tribunal cases.

3.12 BUSINESS DISPUTE RESOLUTION IN THE GHANAIAN

LEGAL SYSTEM

3.12.1 Litigation

Litigation is the conduct of a lawsuit in a court of law. It is important

because it offers disputing parties an opportunity to resolve legal
disputes in accordance with law. Litigation is an intensely procedural
process. It is governed by rules and generally starts when one or
more parties (called the plaintiff or plaintiffs) or their lawyers file a
claim against one or more parties (called the defendant or
defendants) for certain specified reliefs in a court of law.

The 1992 Constitution and the Courts Act10 provide the composition
and jurisdiction of the courts. The Constitution itself indorses the
courts as the final location for resolution of legal disputes. Indeed, by
virtue of Article 125 (3) of the Constitution, judicial power, that is the
power to adjudicate, or resolve disputes in accordance with legal
rules, vests ultimately in the Judiciary.11 According to Clause 3 of
Article 125, no President of Ghana, Parliament and any other organ
or agency created by the President or Parliament, power to exercise
the final say in any judicial matter. In a criminal case therefore, where
a party is to be adjudged guilty of any offence, Article 125 (3) implies
that, final or ultimate determination of that party’s guilt in terms of law,
can only be made by a duly constituted court exercising criminal
jurisdiction.

10
Act 469 of 1993 as amended by the Courts (Amendment) Act of 1993 (Act 464)
11
In Akainyah v. The Republic (1968) GLR 548, it was decided that an essential attribute of judicial
power, was the power to decide on claims by disputing parties in accordance with established legal
principles, as well as, the power to enforce those claims.
 The Code of Ethics of the Ghana Bar Association, however, makes it
is the professional obligation of lawyers to advise their clients to avoid
or terminate litigation whenever the controversy admits of fair
settlement.12 In Ghana, given that litigation could be a costly, harmful
to reputation and time-consuming, many companies are now opting
for alternative forms of resolving disputes in or outside court.

3.13 ALTERNATIVE DISPUTE RESOLUTION

Alternative Dispute Resolution (ADR) refers to a range of procedures

that serve as alternatives to traditional litigation for the resolution of
disputes and generally involves the assistance of a neutral or
impartial third party.

Generally, ADR applies to civil matters between private persons not

criminal matters, which are matters between the Republic and a
person. With the passage of the Alternative Dispute Resolution Act
(Act 798) of 2010 ADR practice has now received a major boost.
Certain courts like the Commercial Court require all disputing parties
to resort to ADR of some type, usually pre-trial mediation, before
permitting a case to be tried. The rising popularity of ADR is explained
by the increasing caseload of traditional courts, as well as awareness
that ADR imposes lesser costs than litigation, there is also
confidentiality, and parties could have greater control over the
selection of the third party who can decide their disputes.13

3.13 TYPES OF ADR MECHANISMS

There are various methods of resolving disputes using ADR. These

methods include; arbitration, negotiation, conciliation, mediation,

12
Section 43 (1) and (2)
13
http://en.wikipedia.org/wiki/Alternative_dispute_resolution
 customary-arbitration, mediation-arbitration and neutral case
evaluation.

3.13.1 Arbitration

Arbitration is an out of court settlement of a dispute by an

independent person chosen by the disputing parties themselves.
Where a contract has a clause requiring the parties to submit dispute
arising between them first to arbitration, the court will enforce it and
will not permit a party to proceed in breach the clause, unless the
matter has been first being dealt with through arbitration.

One significant advantage of arbitration is that the parties themselves

are involved in choosing the person who is going to settle their
dispute. This means that they can request the services of an expert in
the particular commercial area they operate in.

Another merit of arbitration is that it is less formal, fully private,

quicker and less expensive in comparison with litigation. Where a
particular dispute covers for example a commercially sensitive matter,
this may actually be more helpful to avoid negative publicity.
Courtroom proceedings on the other hand are usually placed on
record and are accessible by the public.

3.13.2 Negotiation

Negotiation is a process by which the parties to a dispute or their

representatives discuss the issues in dispute with the intention of
settling the dispute without the intervention of one or more third
parties.

For negotiation to succeed, the parties must be willing and ready to

compromise. And they must act in good faith and be responsive to the
legitimate interests, concern and fears of each other.

3.13.2 Mediation
Mediation is a process by which a neutral or impartial third party, known as a
mediator, acts to assist the disputants to find ways to resolve their dispute.
The duty of the mediator is to facilitate dialogue between parties to assist
them to arrive at a mutually acceptable settlement. The mediator works with
the parties to find the situation that best fits them all and not to decide who is
right or wrong (Kelsey, 2013).

There are three types of meditation approaches that the mediator can opt
for. The amount of control the disputing parties have is the main difference
between these types:

 Evaluation Meditation: This type focuses on the legal rights of the

parties disputing. The mediator hears the different sides of the issue
and evaluates it based on the legal rights and fairness to bring out a
solution that fits all. The mediator used in this type needs to have a
legal background.
 Facilitative Mediation: The parties here have more control over the
process. The mediator does not give an opinion about the solution but
ensures that the parties come to an agreement of their own.
 Transformative Mediation: Like the facilitative mediation, the power
of settling disputes lies with the disputing parties. The parties
determine and layout the process and the mediator only helps them
understand each other’s values and point of views. This type is mostly
used to resolve interpersonal disputes (Legal Service Article, 2011).

Mediation offers the various parties the confidentiality needed to settle

their case. The confidentiality involved is such that mediators cannot
be forced to testify in court about the case. Parties can have the
privacy to settle their differences without spewing it out in public.

During mediation there is a mutual attempt to arrive at a solution that

suits all parties involved. This goes a long way to maintain and
repairing the relationship between the disputants. The main
characteristics of mediation are, however, as follows:
 It is a confidential procedure. This means the parties cannot be
compelled to disclose information that they prefer to keep confidential.
That information cannot be provided to anyone including even a court
outside the context of the mediation.
 It is a non-binding procedure controlled by the parties. This means
that a party to mediation cannot be forced to accept an outcome that it
does not like. Unlike an arbitrator or a judge, the mediator is not a
decision-maker. The mediator's role is, rather, to assist the parties in
reaching a settlement of the dispute. Indeed, even when the parties
have agreed to submit a dispute to mediation, they are free to abandon
the process at any time after the first meeting if they find that its
continuation does not meet their interests. However, parties usually
participate actively in mediations once they begin. If they decide to
proceed with the mediation, the parties decide on how it should be
conducted with the mediator.

3.13.4 Customary Arbitration

Customary Arbitration involves a voluntary submission of a dispute to

one or more arbitrators acting under customary law or according to
customary traditional norms.

The the process of voluntary submission of a dispute to one or more

neutral persons for a final and binding determination or settlement.
Arbitration can start only if there exists a valid Arbitration Agreement
between the parties prior to or after the emergence of the dispute.
Usually it is advisable if such an agreement is in writing.

3.13.5 Conciliation

Conciliation is similar to mediation. In this type of dispute resolution, a

third party (Conciliator) helps the parties to reach a resolution and the
third party plays a more active role in bringing the parties together and
suggesting solutions.
 Conciliation is a less formal form of arbitration. Conciliation does not
require the existence of any previous agreement. Any party may
request the other party to appoint a conciliator. A single conciliator can
be appointed but two or three are also acceptable. Where there are
multiple conciliators, all must act jointly. Where a party rejects the offer
to conciliate, no conciliation can be held.

Parties may submit statements to the conciliator describing the general

nature of the dispute and the facts in issue, and to each other. The
conciliator may request further details, and the parties may even submit
suggestions for the settlement of the dispute to the conciliator. Where
the conciliator finds that settlement exists, he can draw up the terms of
settlement and server it to the parties for their acceptance. If the parties
accept to sign the terms of settlement it becomes final and binding on
them.

The effects of conciliation include the fact that the parties involved
maintain their autonomy and control over the process. Conciliation is
also a good way of saving time and cost due to the fact that the parties
have the advantage of doing things to suit their time and financial
situations. Parties involved also enjoy the confidentiality that comes
with having to settle the dispute with only the other parties and the
conciliator.

3.14 THE ADVANTAGES OF ADR FOR CORPORATE BUSINESSES

ADR is increasingly being used, locally and internationally. In many

countries it has been integrated into the legal system. Among its merits
are the following:

 ADR is suitable in multiparty disputes

 ADR is flexible in procedure as the process is determined and
controlled by the parties to the dispute
 ADR costs tend generally to be lower
 ADR processes are less complex
 ADR parties have choose their own third party ―judge‖ to direct
negotiations/adjudicate
  ADR has greater likelihood of generating speedier settlements
 ADR solutions can be tailored to suit the parties’ interests
 ADR has a better likelihood of obtaining a durable agreement
 Confidentiality is assured with ADR
 The preservation of relationships and the preservation of
reputations

3.15 INTERNATIONAL BUSINESS ORGANIZATIONS AND

COMMERCIAL DISPUTE RESOLUTION

International Chamber of Commerce (ICC)

The International Chamber of Commerce (ICC) was created in
1919 to serve international business by promoting trade and
investment, open markets for goods and services, and the free flow of
capital. The organization's international secretariat was established
in Paris and the ICC's International Court of Arbitration was created in
1923.

The ICC also produces and promotes trade standards relating to

carriage and the passage of risk called Incoterms. These standards
may specifically be included in international agreements entered into
by contracting parties.

3.15.1 Incoterms
Incoterms are international terms used in international sales
contracts. They were developed mainly to address certain issues on
which buyer and seller need to have agreement if the contract is to be
performed satisfactorily. These issues include:

 How far insurance costs are included in the contract price

 The time at which risk and property in the goods pass
 How far carriage costs are included in the contract price
 How bears the risk of damage or loss at any particular point in
time
 Who has responsibility for raising customs documentation,
and
  How far customs are included in the contract price among
others.

3.15.2 International Court of Arbitration (ICA)

The ICA promotes and facilitates the use of arbitration in

commercial disputes, as an alternative to litigation. The ICA
engages in arbitral proceedings, maintains a list of arbitrators,
decides challenges involving arbitrators, approves arbitral awards and
fixes arbitrator fees. States which have ratify the ICC’s New York
Convention of 1958 agree to recognize arbitration agreements, and
also agree not to submit such disputes to national courts.

3.15.3 World Trade Organization (WTO)

The World Trade Organization (WTO) is an international organization

which deals with rules of international trade between nations. The
WTO emerged out of the General Agreement on Tariffs and Trade
(GATT) of 1995. WTO has more than 150 members and is devoted to
the promotion of international free trade, in goods, intellectual
property and services. The WTO assists with the settlement of
international trade disputes through its Dispute Settlement Body
(DSB). The DSB comprises of a panel of experts. A ruling by the
panel is binding but is subject to an appeal.

The panel of experts is appointed by the DSB in consultation with

the countries in dispute. Panelists for each case are chosen from a
permanent list of well-qualified candidates, or from elsewhere, but
they serve in their individual capacities and cannot receive
instructions from any government. Any appeal is heard by three
members of a permanent seven-member Appellate Body set up by
the DSB and broadly representing the range of WTO membership.

3.15.10 United Nations Commission on International Trade Law

(UNCITRAL)
The United Nations Commission on International Trade Law
(UNCITRAL) is a body within the UN which focuses on international
trade law. UNCITRAL was created in 1966, when the General
Assembly recognized that differences in national laws governing
international trade were hampering trade.

3.15.4 The International Institute for the Unification of Private

Law (UNIDROIT)

The International Institute for the Unification of Private Law

(UNIDROIT) set up in 1926 is an independent intergovernmental
organization based in Rome which studies the needs and methods for
modernizing, harmonizing and coordinating commercial law between
States and groups of States and to formulate uniform law instruments,
principles and rules to achieve those objectives. Uniform rules
prepared by UNIDROIT are concerned with substantive law rules;
they will only include uniform conflict of law rules incidentally.
Since UNIDROIT in an intergovernmental structure, its rules take the
form of international conventions. These apply automatically in
preference to a state’s national law once all the state’s formal
requirement for their entry into force has been completed. However,
states often regard international conventions as a low priority and
therefore take their time to implement them. In an attempt to avoid
this, UNIDROIT has favored alternative where a binding instrument is
not essential, such as:

 Model laws to be adopted or adapted when drafting domestic

legislation on the subject covered.

 General principles addressed directly to judges, arbitrators

and contracting parties who are then left free to decide whether
to use them or not.
  Legal guides, typically on new business techniques, on new
types of transaction or on the framework for the organization of
markets at both the domestic and the international level.

Many UNIDROIT drafts have resulted in international instruments

produced alongside other UN bodies such as the UNCITRAL
Convention on Contracts for the International Sale of Goods.