Arbitration system ain’t broke

Having to appoint arbitrators from a fixed panel was a daft idea – we must ensure the system stays flexible

Lorraine Brennan
Lorraine Brennan

Certain things are just not good ideas: combovers, socks with sandals or anything tie-dyed. I had a similar reaction when it was suggested that, contrary to the longstanding tradition of party-nominated arbitrators in commercial arbitration, the Arbitral Institutions should appoint all three members of the tribunal from a fi xed panel.

Initially, I thought the idea was being fl oated just to be provocative – a little controversy to keep everyone on their toes. But the idea picked up steam and was discussed at international arbitration conferences. I felt like the boy seeing the Emperor’s new clothes – couldn’t everyone see he was in his birthday suit? And yet I heard people I know and respect defending the idea.

It seemed that most of these people presupposed they would be on the elite list. Would they feel the same if their names were not among the chosen? Yes, apparently.

They told me they would be fi ne with the idea, even knowing they would never be on the list. I did not actually observe their noses growing as they said this, but suspected there was a degree of false modesty involved and that they, in fact, assumed they would be included. Or perhaps, like Groucho Marx, they would not want to belong to a club that would have them as a member.

Fortunately, the 2012 International Arbitration Survey on Current and Preferred Practices in the Arbitral Process, published by White & Case and Queen Mary University of London, revealed that most arbitration users do not think this idea is any good either. It revealed that 76 per cent of users prefer the selection of the two co-arbitrators in a three-member tribunal by each party unilaterally. The emperor had put his clothes back on.
So why was I so averse to the proposal? It was not just that I feared for diversity, although that was a concern. One of the most powerful choices a party can make in an international arbitration is their choice of arbitrator. Tant vaut l’arbitre, tant vaut l’arbitrage. Why would anyone want to relinquish that choice?

I am not suggesting the arbitrators would not be capable or that institutions would not compile lists of worthy names, but if you asked fi ve people in the arbitration world who their top 10 would be you would get five very different lists (admittedly with some overlap).

Sitting on the institutional side for many years I have had mixed feedback on arbitrators. Despite some positive feedback, there have also been comments such as “X was unprepared”, “Y was too soft/tough regarding disclosure” and “Z appeared bored”.

I also commonly hear that “soand- so is a ‘name’”. What does that mean? Topshop is a name, but it doesn’t mean I want to shop there.

Who decides who is good and worthy of being on such a list?

We have had some staggering losses in the international arbitration community in the past year.

True giants in the fi eld have left us.

We honour their memory by continuing to ensure the international arbitration process remains vital, flexible, and adaptable.

Exclusion and complacency have no place in this realm. Let’s hear it for the parties and their process.

Long may it abide.