| Experts in Commercial Arbitration
Hot issues in international arbitration
Doug JonesClayton Utz Sydney
International arbitration has seen strong growth since the 1980s, with increases in the number, complexity and magnitude of disputes being arbitrated. Indeed, international arbitration continues to be the dispute resolution mechanism of choice in determining international disputes. However, along with these increases the arbitration community has seen an increase in the number of complaints directed towards international arbitration, with regards to the length and cost of arbitral proceedings. In addressing these complaints, arbitration practitioners have recognised the need to ensure efficiency of the arbitral process.
An important way in which the tribunal can have an impact on the efficiency of the arbitral process is through proactive case management. In a similar manner as seen in many common law jurisdictions, the implementation of various case management strategies sees the tribunal playing an active role in shaping the arbitral procedure.
Some of the problems that have been identified in international arbitration include increasingly broad discovery processes, longer briefing schedules, considerably larger briefs, a far greater reliance on experts and witness testimony, and an associated increase in related procedural challenges. The impact of these procedural issues can be considerably lessened through proactive case management. While case management can incorporate a variety of techniques, special attention should be paid to limiting documentary disclosure, the use of party-appointed experts and the use of witness statements.
Arbitral tribunals must balance their duty to ensure the proceedings are progressing as efficiently as possible with their duty to ensure a fair process and equality of treatment of the parties. Ideally, tribunals aim to ensure that an appropriate balance between these two principles is reached. A study undertaken by Queen Mary University found that parties contribute most to the length of proceedings, but that arbitrators and arbitral institutions are best placed to reduce delay. Survey respondents gave preference to proactive arbitrators and arbitral institutions that take control of proceedings, firmly adhere to deadlines and communicate effectively with the parties (International Arbitration Survey: Choices in Internatitional Arbitration, White & Case and Queen Mary University, 2010, available at www.whitecase.com)
Arbitral institutions have also recognised the need to address issues relating to the time and cost of international arbitration. Consequently, the ICC commissioned a Task Force on Reducing Time and Cost in Arbitration ("Techniques for Controlling Time and Costs in Arbitration: Report from the ICC Commission on Arbitration", ICC Publication 843 (2007), available at www.iccwbo.org).
Consistent with the findings of the Queen Mary University survey, the ICC Task Force observed that case management techniques play an important role in addressing these issues.
Recent developments in information technology have led to an exponential growth in the quantity of information produced in relation to various disputes. As a result of this and the development of e-discovery type procedures, document disclosure is increasingly becoming an arduous and resource-intensive part of the arbitration process.
Given the broad discretionary powers available to arbitrators in relation to procedure, the tribunal has a substantial degree of freedom to define the manner of evidence-taking, including the right to document disclosure and the extent to which this is used. In practice, arbitrators tend to err on the side of allowing evidence to be tendered, in an attempt to uphold the principles of due process. It is, however, crucial for arbitrators to recognise their duty to maximise efficiency, and understand that while arbitration laws may require that the parties be given a "full opportunity" of presenting their cases (for example article 18 of the Uncitral Model Law on International Commercial Arbitration), this is not a licence to expect or demand excessive, time-consuming and inappropriately demanding disclosure.
The use of party-appointed expert witnesses is common in international arbitration, yet lamentably the efficient use of these experts is far less common. One of the most significant challenges in this area is that expert witnesses tend to be perceived as hired guns, tailoring their evidence in support of the party by whom they have been appointed.
This is not an issue unique to arbitration, with reform in this area taking place within common law countries globally, spurred by a 1996 report by Lord Woolf in the UK expressing concerns over the expensive costs and delays involved in litigation (Access to Justice: Final Report to the Lord Chancellor of the Civil Justice System in England and Wales, 1996). The report made several recommendations with regard to expert witnesses, recommendations that should be kept in mind by arbitral tribunals.
Fundamentally, the recommendations were based on the notion that the expert has an overriding duty to assist the court, impartially and independently, and not to act as an advocate for either party. This has informed the development of arbitration rules to which parties can voluntarily subscribe, such as the International Bar Association's Rules on the Taking of Evidence in International Arbitration, and the Chartered Institute of Arbitrators' Protocol for the Use of Party-Appointed Expert Witnesses in International Arbitration.
Primarily due to the factually complex nature of international arbitration, witness statements (as opposed to oral evidence in chief) have become the favoured manner of receiving evidence from witnesses.
While there are many advantages to the use of witness statements, including levelling the playing field for lawyers from both civil and common law jurisdictions who are familiar with differing procedural requirements, there are concerns that need to be addressed. An issue identified by many international arbitrators relates to the reality of witness statements drafted by lawyers as a detailed account of the witness' testimony and merely signed and affirmed by the witness. The extensive proofing and re-drafting of witness statements has resulted in their becoming an extension of the lawyer's tools of advocacy as opposed to objective evidence.
Clearly this diminishes the value of witness statements as useful evidence to the tribunal. It is vital, therefore, that lawyers' involvement in the drafting stage of witness statements be kept to a minimum. This will ensure that the statement is that of the witness, and not the lawyer. Further, if often assists in ensuring conciseness and brevity, without rhetorical frills or excessive partiality.
By embracing these case management techniques and continuing to develop novel approaches to arbitral procedure, international arbitration can ensure that it retains its position as the effective and efficient dispute resolution method of choice for international disputes. The role of the tribunal is essential in ensuring this, but the burden is not solely its to bear. Instead, a cooperative effort by everyone involved in the arbitral process is to be encouraged in meeting the worthy ambitions of international arbitration: efficiency, swiftness and affordability.