Lagos is a metropolitan city located in the south west geo-political zone of Nigeria. It has long been a trading/commercial hub of Nigeria and West Africa because of its commercial/economic importance; and is now one of the largest and fastest growing urban cities in the world. The commercial and economic position of the state naturally gives rise to disputes among business men and parties to commercial transaction, as disputes are inevitable in all human relation especially business transactions. Litigation is the traditional method of settling such disputes but, because of its attendant problems of delay, excessive cost, rigid procedures, unnecessary publicity and adversarial nature as well as the need to preserve and further their business relationships, parties in recent times now embrace arbitration and other Alternative Dispute Resolution (ADR) mechanisms which is faster, cheaper, less cumbersome, more effective and efficient to resolve their disputes. Arbitration is one of the most suitable means of resolving commercial disputes in Nigeria. It is an alternative method of dispute resolution in which a neutral third party (arbitrator) hands down a decision after a hearing, of which both parties have an opportunity to be heard. Arbitration involves a fair resolution of disputes between not less than two parties for determination in a judicial manner by person(s) other than a court. Arbitration is principally regulated by the Arbitration and Conciliation Act. However, after several years of its application, recent trends of development in investment, social -economic and commercial relation in Nigeria revealed that there is the need to review and probably amend the Act, to meet contemporary realities and developments in order to ensure its continuing efficacy and effectiveness. Also the much- touted advantages of arbitration over litigation is often in practice bedeviled with one snag or the other,
thereby making arbitration an alternative to litigation only in theory. Hence, the need to ensure a responsive legal framework for the conduct of arbitral proceedings to meet the contemporary international standard relevant to the socio-economic circumstance of Lagos State, the commercial nerve centre of Nigeria which necessitated the enactment of Lagos State Arbitration law. Prior to this development, the principal law regulating the practice of commercial arbitration in Lagos State and Nigeria in general is the Arbitration and Conciliation Act which seeks to provide for a unified legal framework for the fair, effective and efficient settlement of commercial disputes by arbitration and conciliation.