A Second (Quasi-Perfect?) Storm Also in Arbitration?

Many users of international arbitration, particularly in-house counsel, have repeatedly expressed concern about the lack of adequate information on arbitrators, resulting in arbitrator selection based on a vague and general reputation often informed by word of mouth or anecdotal information. Arbitral institutions and arbitration circles cannot remain indifferent to this need. The first step in dealing with this issue is the disclosure by arbitrators of the information contained in the arbitrator’s pledge launched by the European Court of Arbitration; another step is the issuance of an official acknowledgement as a ‘certified arbitrator’ by arbitral institutions and eventually the requirement that certified arbitrators abide by the universal code of ethics.

An important article on A Perfect Storm written by a good team of authors,1 in the course of its analysis of the significant changes which are occurring and which affect litigation, and in particular General Counsel and their Corporate Law Departments, has turned to mediation, stressing, on the one hand, that in-house counsel are more demanding in order to better manage legal risks, and on the other hand, the lack of ‘transparency and greater control’. They suggest that ‘resolvers will replace litigators’ and add ‘and here comes the rub’. How may corporate counsel select the ‘right horse for the course’ without the right information ‘about the available riders’? They add ‘That is why the Perfect Storm heralds change for mediators and provider entities accustomed to operate behind a privacy screen’, and further ‘what worked for a few mediators and providers in the past in terms of vague and general reputation will not sustain them for the future’, and then ‘Corporate counsel’s growing appetite for transparency and authenticity will drive demand for access to prior user feedback before making a choice of an individual mediator or provider institution.’
These authors suggest that mediators should show ‘the world’s users how very good they are’. They conclude that ‘becoming an IMI certified mediator fits the bill’. In fact, the International Mediation Institute (IMI) and the recognition of the status of IMI Certified Mediator have become a decisive element in helping to select the right mediator.
This is a part of the so described Perfect Storm.
It is suggested that exactly the same problem exists for the users and in particular for in-house counsel as to the selection of arbitrators. This has induced me to propose the title of this article, ‘A Second (Quasi-Perfect?) Storm Also in Arbitration?’
The selection of arbitrators is very frequently based on a ‘vague and general reputation’ which in turn is quite often based on ‘word of mouth’ or on anecdotes. The arbitration community has (it is suggested) a duty to follow the path so well shown by the IMI. I propose that this target be achieved through three steps.
A first step may consist in the invitation to arbitrators to issue an Arbitrator’s Pledge, i.e. to make known the general statement of that arbitrator, addressed to whom it may concern, by which he/she states, as per attached form, his/her position on various issues. The European Court of Arbitration has adopted such a Pledge (2).  Amongst the matters addressed are the acknowledgement of the right of the parties to prove their case, without the arbitrators limiting the number of witnesses and/or the questions (unless they are not relevant or inappropriate); the commitment to ask the parties immediately after being appointed as to various issues concerning what each of them expects from the arbitrators and from the arbitral proceedings; to invite the parties to enter early on into a stipulation concerning time, procedure and costs; to undertake to act with diligence and expeditiously and to devote to the proceedings all the time which they require. The Pledge of the arbitrator to the parties may have as an enclosure a questionnaire in which he/she provides information as to his/her general attitude in the conduct of the proceedings.
It is suggested that, while the Pledge and the related documents may substantially help the users to understand which arbitrators they would get, this step needs to be completed by two others.
In line with the IMI’s role, it seems that a procedure is to be worked out which provides that a universally accepted body certifies the arbitrary. This is already the practice of the Chartered Institute of Arbitration which certifies arbitrators and grants the seniority status of Fellow of the Institute, the last step being the right to describe himself/herself as a Chartered Arbitrator. In my opinion, either the Chartered Institute of Arbitration or (if it is not available) an equally highly and universally accepted body should, like the IMI, issue an acknowledgement which, after due control, entitles someone to be described as a Certified Arbitrator. This is a message easier than a reference to fellowship.
This will be a further assurance for users as to the level of the arbitrator, when he/ she is considered for appointment. If a user (even an in-house counsel) discovers that the person which he/she has in mind is not a Certified Arbitrator, and nevertheless decides to appoint him/her, he/she will not be entitled to complain later as to his/her possible lack of the qualities which such a certificate acknowledges. The certification and the Pledge together will allow appointments to be made not just based on ‘passe parole’ or on vague impressions, and on the CVs or even ART presentation of arbitrators.
This structure will be completed by the acceptance by the arbitrator of a Code of Ethics. Catherine Rogers (3) has advocated that arbitration circles auto-regulate themselves in ensuring that an ethical standard is identified and generally accepted. In turn, Vidack, Greenwood and McIlwrath, together with Deborah Masucci (4), have been advocates of the need for in-house counsel to be able to be much more informed as to the arbitrator when they envisage appointing one.
Various codes of ethics already exist, such as:

  • Code of Ethics approved by the Court of Justice of the European Union for its judges;
  •  Code of Ethics of the European Court of Arbitration;
  •  IBA’s Guidelines on Party Representation in International Arbitration;
  •  CIArb’s Practice Guideline;
  • Guidelines on Conflict of Interest in International Arbitration (International Bar Association);
  • Law Society of Upper Canada Adjudicators Code of Conduct;
  • London Court of International Arbitration Notes for Arbitrators;
  • ICC Arbitrator Statement Acceptance, Availability, Impartiality and Independence (International Court of Arbitration);
  • Code of Conduct for Arbitrators (National Arbitration Forum);
  • Hong Kong International Arbitration Centre Code of Ethical Conduct;
  • Code of Professional Conduct for Counsel (International Criminal Court);
  • Code of Ethics of the Saudi Center for Commercial Arbitration;
  • Code of Ethics for an Arbitrator (Singapore International Arbitration Center)
  • Code of Conduct for Arbitrators (China International Economic and Trade Arbitration);
  • Commission Rules of Conduct for the Understanding on Rules and Procedures (World Trade Organization);
  • AAA Code of Ethics Cannon III.

The arbitral institution which would provide a certification to arbitrators could work out a universal code of ethics. Its acceptance by a candidate should be a requirement in order that he/she be certified.
If IMI’s certification of mediators may be considered (or included in) a Perfect Storm, it is suggested that the above steps may perhaps be described as preparing a Second (quasi- or only partial) Perfect Storm in arbitration.
Those who provide arbitration services and those who care about a better selection mechanism are invited to consider the above proposals and to discuss them, contributing to their improvement and implementation.

(1) J. Eisbouts, H. Peter Frick, Bergst Gustavson, Marina Kaldina, Wolf von Kumberg, Erik B. Pfeiffer & Deborah Masucci et al., A Perfect Storm is Gathering (Feb. 2009).
(2) M. Rubino-Sammartano, The Arbitrator’s Pledge Launched by the European Court of Arbitration, 26(4) Am. Rev. Int’l. Arb. 599 et seq. (2015).
(3) C. Rogers, Ethics in International Arbitration (Oxford University Press 2014).
(4) E. Vidak Gojkovis, L. Greenwood & M. Mcilwrath, Puppies or Kittens? How to Better Match Arbitrators to Party Expectations?, Austrian Y.B. Int’l Arb. 61 (2016).

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Reprinted from JOIA, 34-0601, with permission of Kluwer Law International.

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