Drawing Adverse Inferences from the Non-production of Evidence

Abstract

ARBITRATING PARTIES, no less than litigating parties, require evidence to prove their cases and to challenge the factual bases of their adversaries' contentions. That evidence, however, often rests exclusively in the hands of adverse parties, which lack obligation or incentive to divulge harmful information. Arbitrators, moreover, lack imperium and typically cannot compel parties to produce evidence. Judicial assistance also has its limits, as obtaining documents from courts is rarely an effective remedy in international arbitration.1 Arbitrating parties thus risk being deprived, unfairly, of the ability to prosecute or defend against claims. International and institutional arbitral rules (and some national arbitration laws) ameliorate this problem by authorising arbitrators, implicitly or explicitly, to draw adverse inferences from parties' non-production of discoverable evidence.2It is generally accepted that if ‘a party after being ordered to do so refuses to disclose documents without reasonable excuse, the arbitral tribunal is likely to infer that the party has something to hide and is likely to treat that party's future evidence with a degree of scepticism’.3