Don’t Shoot the Sheriff: the Threat of Legal Claims Against Arbitrators and Arbitral Institutions

Abstract

Abstract While arbitrators and arbitral institutions should be held accountable if they act unlawfully or in bad faith, increasingly they also face serious legal attacks by parties dissatisfied with awards. These attacks often concern alleged lack of arbitrator independence and impartiality or violations of due process. These claims raise important issues concerning institutional and arbitrator immunity. In prolonging the dispute through collateral attacks, they can also undermine the finality and efficiency of arbitration as a dispute resolution process. Moreover, as parties’ conduct becomes more aggressive, such accusations may exacerbate ‘due process paranoia’. Finally, there is an obvious practical impact for arbitrators – particularly full-time arbitrators – who must be mindful of the risks and consider professional indemnity insurance, and for institutions who should address their own and their arbitrators' insurance position and generally be more transparent about the coverage that they provide. The article reviews some of the most recent claims against arbitrators and institutions alike to draw some lessons and propose concrete solutions to address the problem in future.