The growth of global trade over the last forty years has been mirrored by the growth of international arbitration as a means for parties to resolve commercial disputes efficiently and cost-effectively. While well-established institutional and ad hoc rules exist to provide the framework for running international disputes (including JAMS), these rules are not sufficient in themselves to cover the varying situations and diverse procedural questions that will arise during the course of the hearing.
The legal representatives of each party quite naturally look to their own substantive legal training under their national system when agreeing how to answer these procedural questions. But in the context of an international dispute these national legal systems can be inappropriate, especially given the diverse backgrounds of parties, lawyers and arbitrators.
International arbitration, therefore, has had to develop its own distinct procedures over the years, influenced heavily by both the common and civil law traditions. It is useful then to examine how common and civil law have helped shape international dispute resolution. And given that arbitrators are likely to come from one or other of the legal traditions, it is also useful for parties and their legal counsel to understand how that is likely to influence the tribunal’s thinking on procedures, evidence and, ultimately, award.
First off, the broad dichotomy which all law undergraduates learn: common law is adversarial in nature while civil law is an inquisitorial system. The common law approach is underpinned by a strong belief in due process and a fair trial while civil law focuses on the equality of parties and their right to be heard. In practice, the common law process involves an initial statement of claim/defence (which tends to be a brief overview of the dispute), followed by an in-depth discovery process where the parties exchange all documentary evidence which is relevant to the case. This is followed by the oral hearing to test the evidence with the dispute being decided on the best version of events, which fits with the facts and the relevant law.
Under the civil law code, the case begins with an exchange of statements of claim and defence along with supporting documents on which the parties intend to rely. There may be several rounds of exchanges between the parties. Civil law statements of claim are more legalistic in nature than the narrative common law approach and may include lengthy extracts from legal texts as the parties argue their case. Unlike common law, witness statements are rarely put forward in the civil law system as witnesses play a marginal role in proceedings (the thinking being that witnesses cannot truly be impartial). The hearing stage of the civil process tends to be a reiteration of the party’s argument in the statement of claim, with the judge relying more on the documents than on oral arguments to come to a final decision.
Broadly speaking, the written stage of international arbitration is more influenced by the civil law tradition while the oral hearing follows the common law heritage. The exchange of documents can be characterised as a hybrid between the two systems.
In international arbitration the initial written submissions tend to be lengthy and put forward points of fact and law. There may be multiple exchanges depending on the nature of the case. The hearing stage tends to look very much like the common law model with witnesses and expert testimony central to proceedings. The document production stage is interesting as it throws light on the differing expectations of common and civil lawyers (as well as arbitrators). The common law system of discovery allows for almost all documents to be available to the other side.
Civil law, on the other hand, allows each party to produce the documents it intends to rely on with no expectation that they must show material which is detrimental to their own case. In international arbitration the rules have developed to ensure that there is enough documentary evidence for the case to be properly decided while avoiding the expense and delay involved in the more expansive approach. The IBA Rules on the Taking of Evidence in International Arbitration 2010 call for "all documents in the possession, custody or control of the other party" that are "relevant to the case" and "material to its outcome".
Overall, the common law approach seems to have had a greater impact on the development of international arbitration over the years. But it is important for practitioners to think about the composition of the tribunal they are dealing with and how it is likely to impact on the decision-making process. Civil lawyers are steeped in decision making based on the documents and the technical legal arguments. Common lawyers are likely to place a greater premium on witness statements and expert testimony. With this in mind, understanding the composition of the tribunal may help practitioners put forward the best version of their client’s case.
Philip McMullan is a writer and researcher.