Written by Team Farallon
The success of an international arbitration case largely depends on the quality of the arbitrators involved. Arbitrators wield significant power in rendering binding decisions, and the parties involved have limited recourse to challenge or appeal an arbitration decision if the arbitrators fail to fulfil their responsibilities. Hence, the selection of an arbitrator assumes critical importance in shaping the outcome of a dispute. The expertise, impartiality, and adeptness of the arbitrator in managing the proceedings can profoundly influence the fairness and efficiency of the arbitration process.
Unlike the traditional courtroom setting, where parties have no influence over the selection of a judge, arbitration allows each participating party to actively participate in choosing the ultimate decision-maker. This active involvement in the selection process necessitates parties to invest time and effort into strategically selecting an arbitrator. They seek to evaluate their chances of success and anticipate the likelihood of prevailing in the dispute, as well as the extent to which they might succeed.
We have identified four factors that should be considered when selecting a suitable candidate:
When selecting an arbitrator, one of the primary considerations is their expertise in the subject matter of the dispute. An arbitrator who possesses a deep understanding of the industry, specific legal issues, or technical complexities involved can ensure a more informed and well-grounded decision. It is advisable to look for arbitrators who have demonstrated experience and knowledge in the relevant field, such as intellectual property, commercial contracts, construction, or any other specialized area.
The parties should assess the suitability of an individual based on the specific economic sector or industry in which the dispute arises. Furthermore, it is crucial to consider the desired outcome, whether it is a determination of infringement, an assessment of liability, an estimation of damages, or a combination of these factors. Additionally, parties should take into account whether only a portion of the dispute will be resolved through arbitration, with the remaining proceedings being pursued in court.
In addition, understanding an arbitrator’s perspective on relevant subject matters is equally essential. This understanding encompasses factors such as their stance on the development of a particular sector or technology, adherence to specific legal standards, or any other relevant considerations. While previous experience in similar cases and comprehensive knowledge of the sector can be invaluable, it is crucial to ensure that the nominated arbitrator’s vision aligns with the party’s interests.
Selecting an arbitrator who holds a diametrically opposing viewpoint to the party’s position is not in their best interest. It is worth noting that persuasive arguments may be able to alter an arbitrator’s perspective, but relying on this uncertainty for success is an unwise decision when choosing an arbitrator, especially if past experience indicates that the arbitrator is unlikely to change their position.
Parties should thoroughly evaluate candidates by examining their CVs, conducting online research, and seeking input from colleagues.
Impartiality and independence are fundamental principles in international arbitration, referenced in national laws, international conventions, and arbitration rules. Generally, tribunal rules offer limited guidance regarding the specific qualifications or abilities required to be a successful arbitrator, apart from emphasizing the imperatives of independence and impartiality. For instance, in the SIAC (Singapore International Arbitration Centre), Rule 10.1 explicitly states that “an arbitrator (whether or not nominated by the parties) conducting an arbitration under these Rules shall be and remain at all times wholly independent and impartial, and shall not act as an advocate for any party.”
While the term “independent” lacks precise definition, it generally denotes a state that can be objectively verified. On the other hand, “impartial” relates to a subjective mental state. Proving a lack of independence is often considered easier than demonstrating impartiality. While an arbitrator’s conduct may not overtly reveal bias, their connections to any of the parties involved can be more readily established through external sources.
To ensure the integrity of the arbitration process, it is crucial to select an arbitrator who has no conflicts of interest with any of the parties involved in the dispute. Thoroughly examining their track record and inquiring about any past or present relationships that could compromise their impartiality is essential. A neutral arbitrator, untainted by biases or conflicts, is paramount in establishing trust and guaranteeing a just resolution.
Effective case management skills ensure a smooth and well-organized arbitration proceeding. It is essential to evaluate the arbitrator’s ability to handle complex disputes, adhere to timelines, and maintain control over the proceedings. A proficient arbitrator with strong procedural expertise can streamline the process, effectively manage evidentiary issues, and ensure that all parties have a fair opportunity to present their case.
One crucial aspect to consider when vetting potential candidates is their caseload. Inquire about their current workload and assess whether the arbitrator can dedicate sufficient time and attention to the parties’ dispute. It is advisable to select an arbitrator whose schedule permits them to take on the case without causing scheduling conflicts or significant delays that could impact the parties’ right to a speedy resolution.
While it is widely known that renowned arbitrators are in high demand and may have substantial caseloads, it is important to prioritize the arbitrator’s ability to handle the specific case at hand. In some circumstances, where specific legal or professional expertise is required and time allows for flexibility, it may be more prudent to appoint the arbitrator who is best suited for the case, even if it means the resolution process may take slightly longer. The ultimate goal should be to prioritize competence and expertise over expediency when appropriate.
Effective communication skills are crucial for arbitrators engaged in international arbitration. An arbitrator’s communicative style serves as a key tool for actively listening to the parties, understanding their positions, and achieving mutually satisfactory outcomes. In the context of international arbitration, where parties originate from diverse legal backgrounds, societies, and possess differing interests, arbitrators must be able to adapt their communication styles to foster flexibility and openness.
Firstly, a good arbitrator needs to be patient, understanding, and flexible, creating an environment where all parties have an equal opportunity to be heard and present their grievances fully. Effective arbitration relies on the arbitrator’s patience in attentively listening to each party’s perspective.
Furthermore, a skilled arbitrator must possess strong communication abilities. This includes being a proficient listener and comprehending the positions put forth by both parties. During the hearing, arbitrators should allow ample time for parties to articulate their grievances without interruptions. Unlike formal court proceedings, arbitration provides a more informal setting, and a competent arbitrator must patiently listen to parties or their representatives as they present their cases.
Additionally, arbitrators must exhibit flexibility in their approach, particularly when parties choose to be represented by non-attorney representatives or present their case without legal representation. The arbitrator should adapt to these circumstances and give due consideration to the arguments presented by party representatives.
Moreover, arbitrators are entrusted with the task of objectively evaluating the facts of the dispute and understanding the potential consequences of their decisions on the individuals involved. This requires a comprehensive assessment that goes beyond simply interpreting the contractual obligations. An arbitrator should consider the broader impact on productivity, morale, and relationships within the workplace. Therefore, it is essential for an arbitrator to remain courteous, professional, and open-minded while attentively listening to both sides of the dispute.
The arbitrators’ track record should demonstrate these traits throughout their careers. Additionally, they should be capable of interacting with others without bias or prejudice and have the ability to interpret new data without becoming stressed or frustrated. Candidates must also exhibit the seriousness and dedication required to fulfill the responsibilities entrusted to them without offloading their stress onto others.
Consulting with legal counsel can be beneficial when searching for a suitable arbitrator. Law firms often maintain a roster of reputable arbitrators, and arbitral institutions like SIAC also provide a list of arbitrators for reference.
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