Question

Discuss some of the reasons seeking an out-of-court settlement in international commercial legal disputes is probably better than suing. Give at least one example? I can't find any example, so if you could give me one please. Thank you

Answer 1

The most significant reason for neglecting court settlements of international legal disputes can be that these proceedings take a lot of time, they are frustrating and incur a lot of costs. Apart from this, there is also a danger of earning bad name out of these settlements in the common public as there will always some sort of media coverage and publicity of these cases resulting in poor company image.

This can also have the issue of incapability of courts and it can come up with the unfair decisions. In fact, arbitration can be seen as a more fair, less time consuming and less expensive decision. Due to the high cost involved in the litigation, most of the firms target to follow the philosophy of first "conciliate", second to "arbitrate," and to "litigate" as a last resort.

Example:- There is a famous case of Inox Wind where the organization looked to go for an out-of-court settlement. This matter is present with NCLAT. Earlier IBC did not permit the parties to withdraw its applications once the case if fled to NCLT

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