Governing Law and Dispute Resolution
Objectives
- Understand governing law and jurisdiction clauses
- Compare litigation, mediation and arbitration
- Advise on a dispute clause
Explanation
'Governing law' determines which country's law applies; 'jurisdiction' determines which courts hear disputes. Arbitration is private and binding; mediation is voluntary and non-binding until settlement. In Costa Rica, institutions include the Centro de Conciliación y Arbitraje (CCA) of the Chamber of Commerce. Foreign awards are recognised under the New York Convention.
governing law
The law chosen to interpret the contract.
“This agreement is governed by Costa Rican law.”
jurisdiction
The authority of a court to hear a case.
“The courts of San José shall have jurisdiction.”
arbitration
A private process where an arbitrator issues a binding award.
“Disputes shall be resolved by arbitration.”
mediation
A voluntary process where a neutral helps parties reach agreement.
“The parties will first attempt mediation.”
award
The decision of an arbitral tribunal.
“The award is final and binding.”