THE AVAILABILITY OF CLASS ARBITRATION FOR SILENT AGREEMENTS: CONTRACT INTERPRETATION THEORY OR ARBITRABILITY DOCTRINE?

Abstract

Along with the increasing use of multi-party arbitration, mounting issues relating to it have recently become heated topics. One of the various facets concerning the availability of class arbitration has gathered overwhelming discussion in the US. According to the decisions of the United States Supreme Court, whether class action is applicable is probably decided by the arbitrator’s interpretation of the parties’ intent when an adequately drafted arbitration clause is silent on this issue, regardless of the correctness of his/her construing of the contracts. The contract interpretation theory is a conclusion of existing jurisprudence while the question of arbitrability doctrine may be a hint or inkling from a recent court decision. Comparing these two sides, it is better to regard the availability of class arbitration for silent agreements as a matter of contract interpretation. Although it is preferable to regard the availability issue of class action as a contract interpretation question, some restrictions on the arbitrators’ broad contract interpretation needs to be imposed so that the parties’ real intent can be properly enforced.