Arbitration – a Law unto itself

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As I said in a paper of 2016“Fortunately there is no copyright in titles, as I would like to take as a text the title of the 30th Annual Lecture organised by The School of International Arbitration and Freshfields Bruckhaus Deringer and given by the Right Hon the Lord Mance, a distinguished Justice of The Supreme Court as he then was, on 4 November 2015.”  I’d like to use it again to remind readers that arbitration is different.

The difference is seen in the way one should refer to a matter in arbitration: because it results from an agreement between two private persons (who may be individuals  –  real people –  or legal persons such as companies or even Governments –  but therein lies another tale) the classic form of Doe vs. Haddock is inappropriate.  We speak of an arbitration between John Doe and Albert Haddock.  The distinction is subtle but of crucial importance. It’s the distinction between trial by combat and seeking the help of a respected professional.  Lawyers, in particular, tend to lose sight of this distinction.  When taking off one’s wig, one should also unbuckle one’s sword.

OED defines arbitration as The settlement of a dispute or question at issue by one to whom the conflicting parties agree to refer their claims in order to obtain an equitable decision.  A couple of historical examples are given: 1661   W. Brereton Trav. To mediate in a friendly manner in a way of arbitration and 1716   O. Blackall Wks. I. xii. 109   To put their Differences to the Arbitration of some of their Brethren.  Nowadays, to refer to mediation and arbitration together requires a sophisticated argument.  My purpose is to highlight the idea of amicable cooperation.

The English Arbitration Act 1996 opens in s.1(a) with the bold and simple statement the object of arbitration is to obtain the fair resolution of disputes by an impartial tribunal without unnecessary delay or expense.  When I have found myself sitting in front of a bookcase filled with lever arch files, and looking at a room full of people, including a pair of legal shorthand writers with their strange machines (laptops of recent years), I have often mused about the dictionary and the Act and wondered if anyone has read either of them.

In 1981, Lord Donaldson described an arbitral award.  In particular he said, “Much of the art of giving a judgment lies in telling a story logically, coherently and accurately. This is something which requires skill, but it is not a legal skill and it is not necessarily advanced by legal training. It is certainly a judicial skill, but arbitrators for this purpose are judges and will have no difficulty in acquiring it. Where a 1979 Act award differs from a judgment is in the fact that the arbitrators will not be expected to analyse the law and the authorities.”  The spirit of the later Act of 1996 is the same.

There is a sentence there that should alert lawyers and laymen alike:  not a legal skill and it is not necessarily advanced by legal training.”

Telling a story logically, coherently, and accurately should be within every professional’s competence, it’s part of the job.  Architects, Engineers, Surgeons, Physicians, Physicists, Art Historians, all can be and have been engaged as arbitrators.  I discussed the reasons behind this in a paper, “Who Shall be the Arbitrators”.

In modern times Lawyers have dominated the field of arbitration, as well they might, but I wanted to remind my readers that it is not an exclusive right.  Arbitrators are not in a Court and are appointed to obtain the fair resolution of disputes.  Moreover, it is their duty to do so without unnecessary delay or expense.

Every private arbitration is unique.  There is no precedent to be set, no natural progression of arbitral awards.  An Award may be perfectly valid in one country and totally unacceptable in another.  That happened in an arbitration between a constructor, Dallah and the Government of Pakistan.  It was upheld by the Cour d’Appel in Paris but enforcement was refused by the Supreme Court in London.  Entente Cordial?

All things considered, I hope I have made my readers take another look at arbitration as a law unto itself.  It isn’t Law at all, the decisions are fair and the reasons logical.  It’s something any professional should be able to do, especially if they undertake the training available from CIArb and a number of Universities.