Private Arbitration Research Articles

First Corinthians 6.1–6: Roman Court or Private Arbitration?

AbstractFirst Corinthians 6.1–6 is consistently read as a Pauline criticism directed against members of the Pauline ekklēsia in Corinth, taking each other to Roman courts. I argue that this understanding of 1 Cor 6.1–6 is implausible in light of practices of Roman law in the provinces and in the colonies. Within a formal court procedure, the Corinthians would not have had the freedom to appoint their own judges, as Paul's language implies. I suggest instead that it is private arbitration which Paul criticises. Papyri dealing with private arbitration and mediation support this reading. Much of Paul's legal terminology in the passage is found in these papyri, making private arbitration a highly plausible suggestion. The suggested reading points to the community's good social ties with the pagan population in the city. It also depicts Paul as working within the framework of Roman law rather than against it. The article exemplifies the benefits of integrating up-to-date studies of Roman law in New Testament Studies.

ZF Auto. v. Luxshare: Supreme Court’s Withdrawal of Judicial Assistance for Discovery from Private Arbitration

Is the judicial assistance intended for the benefit of ‘foreign or international tribunals’ under 28 USC § 1782 available for private arbitral tribunals? The Supreme Court of the United States says it is not because that assistance is intended only for tribunals vested with governmental authority and private arbitral tribunals lack such authority. This strained reading of section 1782 appears to have been reached to achieve policy objectives, not through rigorous analysis of the statutory provision itself. Although the end the Court sought to achieve is not without merit, the means chosen by the Court to achieve the same will give rise to, among others, the unintended consequence of curtailing international commercial arbitration in contravention of the federal policy favouring arbitration. This is so because the Court ignored the root cause of the problem it sought to solve, namely that section 1782 is available to ‘any interested person’ who is not required to be before any tribunal at all. Instead of trying to solve one problem with the wrong solution, the Court should have closed or Congress should close the loophole in section 1782 so that it may properly function and provide the judicial assistance as originally intended by Congress. Arbitration, arbitral tribunal, discovery, 28 USC § 1782, Hague Evidence Convention, Intel v. AMD, Intel factors

INTERNATIONAL. A Look at America – Part 3 – The Dynamism of the Field of Private Arbitration

INTERNATIONAL. A Look at America – Part 3 – The Dynamism of the Field of Private Arbitration

The Death Knell and the Wild West: Two Dangers of Domestic Discovery in Foreign Adjudications

Under 28 U.S.C. § 1782(a), parties to foreign legal proceedings can obtain discovery orders from United States federal courts. In other words, if a foreign party needs physical evidence located in—or testimony from a person residing in—the United States to support their claim or defense, they can ask a district court to order the production of that evidence. For almost two decades, § 1782(a) practice has operated as a procedural Wild West. Judges routinely consider § 1782(a) applications ex parte—that is, without giving the parties subject to the resulting discovery orders a chance to oppose them—and grant those applications at a staggering rate: more than 90% of the time. In its June 2022 decision in ZF Automotive US, Inc. v. Luxshare, Ltd., the Supreme Court transformed § 1782 jurisprudence for the worse. The Court held that private arbitral tribunals do not fall under § 1782(a)’s scope and that, as a result, parties cannot obtain discovery for use in foreign private arbitration under the provision. This Note argues that, after ZF Automotive, § 1782(a) jurisprudence contains two dangers: (1) it subjects some parties to burdensome discovery orders with few procedural safeguards, and (2) it prevents parties who have chosen to arbitrate rather than litigate from obtaining discovery entirely. This Note contributes to existing scholarship by proposing structural changes that would improve § 1782(a) practice. Specifically, it argues that courts cannot root out the procedural flaws that plague § 1782(a), and that, consequently, Congress should enact a new and improved § 1782 to address these manifold problems.

Crime Sharing: How the Sharing Economy may Impact Crime Victims

ABSTRACT The sharing economy (e.g., Uber, Lyft, Airbnb) is growing rapidly. It is a disruptive innovation in how people cooperate and share services and products in many ways. One of the likely outcomes of this change is reducing crime and transitioning from publicly provided justice systems to prevention and alternative dispute resolution. These changes occur because the sharing economy alters the opportunity structure of committing a crime and enhances safety by increasing digital place managers, guardians, and handlers. Further, the sharing economy places victims back at the forefront of concern and often identifies alternative dispute resolution outside the criminal justice system. These changes are evident from a content examination of 40 popular sharing platform websites. Findings indicate that 78% have a rating system in place, 50% have a help section for problems between sharers, 80% provide access to contracts on their websites, and 63% specify arbitration if disputes cannot be settled. These findings indicate that the sharing economy and private regulation are impacting the structure of the justice system, enhancing safety, reducing the private ownership of products, empowering victims with knowledge of sharing partners, and providing access to private arbitration to solve disputes.

The Law of Arbitration and EU Law – like Oil and Water?

The relationship between EU law and the law of arbitration has often been described as one of mutual indifference. However, from about 2010, the two systems began to interact with one-another through certain decisions of the CJEU. This led some observers to argue that the two systems had become intertwined. In order to establish whether the decisions of the CJEU provide a basis for such a finding, the present article considers the interaction between the two legal systems in three different areas. Firstly, whether in certain situations an arbitral tribunal must take EU law into consideration when deciding a dispute. Secondly, those situations where, one way or another, a Member State has been involved in the arbitration. Thirdly, the question whether arbitral tribunals can make so-called preliminary references to the CJEU under the TFEU. While the examination of the relationship between EU law and the law of arbitration shows that increasingly the two systems interact with each other, it also shows that in relative terms there are only a limited number of instances where EU law plays a role within the field of private arbitration. The article therefore concludes that the law of arbitration and EU law continue to be distinct legal systems.

Are FTA’s making the World Less Free? A Case Study of TPP

Abstract On January 23, 2017, right after assuming presidency, US President Donald Trump did good on his promise and signed the executive order that withdrew USA from the very agreement that it commenced the negotiations for: Trans Pacific Partnership (TPP). The unratified multinational trade agreement encompassed 12 countries which accounted for %40 of the world’s GDP and over 800 million people. On a broader scope, TPP is often affiliated with two other trade deals; Transatlantic Trade and Investment Partnership (TTIP) and Trade in Services Agreement (TiSA) both of which in terms of content resemble a lot that of TPP. Given the fact that TTIP and TiSA are not complete and not entirely disclosed with the public, we shall be exclusively focusing on TPP. TPP has been subject to many controversies. But particularly the notion that TPP would enable corporations to sue governments in private arbitration tribunals over lost profits has drawn much attention. In this article we shall be investigating whether there is some truth to these allegations. Providing reference from the articles of the agreement, we shall be discussing the qualities of TPP’s judicial reforms. But firstly, in order to introduce the reader to the subject; we will be providing with some context, to properly frame the subject, and with some information about the nature of these agreements. Secondly, we shall be addressing our main issue. In addition, we will be questioning the framework within which the agreements are officially presented. Finally, a conclusion that compromises the author’s assessment of the case will be provided.

The Law of Arbitration and EU Law – like Oil and Water?

The relationship between EU law and the law of arbitration has often been described as one of mutual indifference. However, from about 2010, the two systems began to interact with one-another through certain decisions of the CJEU. This led some observers to argue that the two systems had become intertwined. In order to establish whether the decisions of the CJEU provide a basis for such a finding, the present article considers the interaction between the two legal systems in three different areas. Firstly, whether in certain situations an arbitral tribunal must take EU law into consideration when deciding a dispute. Secondly, those situations where, one way or another, a Member State has been involved in the arbitration. Thirdly, the question whether arbitral tribunals can make so-called preliminary references to the CJEU under the TFEU. While the examination of the relationship between EU law and the law of arbitration shows that increasingly the two systems interact with each other, it also shows that in relative terms there are only a limited number of instances where EU law plays a role within the field of private arbitration. The article therefore concludes that the law of arbitration and EU law continue to be distinct legal systems.

THE ROLE OF REASONABLENESS IN THE REVIEW OF LABOUR ARBITRATON AWARDS (PART 1)

This article is published in two parts. In the first part (published in this edition of Obiter) the authors establish the general principles relating to administrative review and consider the different forms of review. Thereafter CCMA arbitration award reviews are considered. As is characteristic of special statutory reviews the Labour Relations Act, 1995 (“the LRA”) makes specific provision for the review of CCMA arbitration awards. The grounds of review are presented in such a manner that it has the effect of limiting the ambit. The administrative nature of CCMA arbitrations is considered. It is pointed out that the courts regard the CCMA as organ of state andthat the rendering of an arbitration award is considered as the commission of an administrative act that is subject to the constitutional imperatives of the administrative justice right of the Constitution. The authors also establish that the courts have not interpreted the restrictive scope of section 145 of the LRA as falling foul of the constitutional right to administrative justice. Rather, the courts have reasoned that, when reading section 145 in light of the constitutional right to administrative justice, the alleged misconduct, grossirregularity, exceeding of powers or impropriety as the case may be need only be measured against the constitutional imperatives of the administrative justice right in order to ensure constitutional consistency. So construed, an arbitration award would be reviewable if the reviewing court is able to conclude that the commissioner has committed misconduct or a gross irregularity or has exceeded his powers in terms of section 145(2) of the LRA because the decision is not justifiable in terms of the reasons given. The award would, however, not be reviewable only because it is perceived to be unjustifiable per se; the justifiability must be attributed to one or moreof the statutory grounds of review found in section 145(2) of the LRA. In Part 2 of the article the effect of the judgment of the Constitutional Court in Sidumo v Rustenburg Platinum Mines Ltd 2007 12 BLLR 1097 (CC) will be analysed as well as the application of the principles established in Sidumo in subsequent case law. Finally the reasonableness standard and private arbitration reviews will be considered. Part 2 will be published in the following edition of Obiter.

THE ROLE OF REASONABLENESS IN THE REVIEW OF LABOUR ARBITRATON AWARDS (PART 2)

This article is published in two parts. In the first part (published in the previous edition of Obiter) the general principles relating to administration review were established and the different forms of review considered. It was also established that the making of a CCMA arbitration award constitutes administrative action that is subject to the constitutional right to administrative justice; that justifiability is a constitutional requirement for just administrative action and that a failure to make a decision that is justifiable in terms of the reasons given may render an award reviewable in terms of section 145 of the LRA. This second part of the article will build on the conclusions of the first by focusing on setting out the key findings made by the CC in Sidumo v Rustenburg Platinum Mines Ltd (2007 12 BLLR 1097 (CC)) as regards the test for reviewing arbitration awards in terms of section 145 of the LRA. The purpose is to establish how reasonableness might best be understood and defined as well as to determine its implications for subsequent review proceedings. Case law that has sought to interpret and apply the principles established in Sidumo, will likewise be discussed in order to contextualise the place of reasonableness in the review of arbitration awards with a view better to understand its implications for the courts’ review function. Particular attention will be given to determining the applicability of the reasonableness standard to jurisdictional reviews. The principles laid down by the labour appeal court in Fidelity Cash Management Service v CCMA (2008 3 BLLR 197 (LAC)) will also be discussed with the objective of determining whether the court’s approach that an award is not reviewable because of flawed reasoning determining that the outcome is sustainable according to reasons identified in the record, and whether this finding is consistent with CC’s findings in Sidumo. It will also be considered whether the reasonableness standard as introduced by Sidumo will have any influence on the review of private arbitration awards in terms of section 33 of the Arbitration Act 42 of 19652 and whether parties can agree that an award would be reviewable on the same grounds and subject to the same test as a CCMA award. Finally, proposals will be made in respect of the interpretation and application of the reasonableness principle for the purpose of assisting in review proceedings to come.

The devil is in the details: How arbitration system design and training facilitate and inhibit repeat‐player advantages in private and state‐run arbitration hearings

AbstractThis article demonstrates that arbitration system design and the training that arbitrators receive shape the extent to which repeat players gain advantages in arbitration hearings. While prior arbitration research does suggest that arbitrator training matters, this is the first article to show how it matters, as we observe actual arbitration hearings in private and state‐run arbitration systems in two states. Our comparative analysis links three literatures interested in how seemingly interest‐neutral institutions, like disputing forums, serve in practice to reinforce dominant norms, values, and hierarchies: (1) sociolegal studies of repeat‐player advantages in disputing, (2) studies of occupational socialization in educational settings, and (3) neoinstitutional organizational sociology studies of how managerial values influence the way in which organizations construct law. We bridge these literatures by showing how arbitrator system design and the occupational socialization that arbitrators receive in private arbitration are primary mechanisms through which managerial values influence the arbitration process, ultimately providing a pathway for repeat‐player advantages in hearings. Because our analysis compares two distinct arbitration systems, we identify variation in these processes and offer preliminary but tangible policy recommendations for the design and implementation of arbitration systems that best protect civil and consumer rights within arbitral forums that the Supreme Court continually upholds.

The effectiveness of EU law and private arbitration

This article examines the impact of the principle of effectiveness of EU law on private arbitration. It uses the frame of post-award litigation to demonstrate that the relationship between these two normative orders is transversal and potentially very disruptive. This is evidenced by the alteration of the burden of proof in post-award actions, the irrelevance of the loss of the right to object, the widening of judicial review over awards that violate EU public policy, and the possibility to scrutinize errors of EU mandatory law concerning the merits of the case. The result is the weakening of the finality of awards and the replacement of the principle of procedural autonomy of Member States by European procedural primacy.

The Effectiveness of EU Law and Private Arbitration

This paper examines the impact that the principle of effectiveness of EU law has on private arbitration. It uses the frame of post-award litigation to demonstrate that the relationship between these two normative orders is transversal and potentially very disruptive. This is evidenced by the alteration of the burden of proof in post-award actions, the irrelevance of the loss of the right to object, the widening of judicial review over awards that violate EU public policy and the possibility to scrutinise errors of EU mandatory law concerning the merits of the case. The result is the weakening of the finality of awards and the replacement of the principle of procedural autonomy of Member States by European procedural primacy.

Reformen bei der Beilegung internationaler Investitionsstreitigkeiten – afrikanische Sonderwege?

Institutions and mechanisms for settlement of international investment disputes are manifold. For sure, rules, principles and core standards for decisions at international level laid down in various documents of public international law are widely agreed upon in general but are rather vague in determining applicable law in specific cases. So, complementing the discussion of the general framework for international investment law in the first part of this study (RiA 2020, 3), the focus will now change to the “architecture” of settlement because effective functioning of judicial, arbitral and (other non-judicial) alternative dispute resolution procedures is most important for an attractive climate for sustainable investment. Although there are many similarities between both concepts, it is necessary to separate mechanisms for private (commercial) arbitration from intergovernmental institutions which deal with ISDS issues. Therefore, structures and procedures, forms of settlement and enforcement of awards as well as other final results of dispute resolution concerning foreign investors and investment abroad will be described and assessed more detailedly by focussing in particular upon African examples. Another core problem is balancing the relationship between intergovernmental and non-governmental dispute settlement and national (including supranational) judiciary in order to get proper efficiency. At last, “Africanization” trends as well as other ways for better and more acceptable impartial and fair ISDS will be evaluated which may comply with legitimate expectations of all relevant stakeholders, not least the general public.

ARBITRATION OF INDIVIDUAL LABOR DISPUTES IN BRAZIL AND JAPAN: A COMPARATIVE ANALYSIS

The way labor rights disputes are solved in Japan and Brazil in the last two decades has changed. New laws and interpretation have been challenging the way labor arbitration functions. In 2004, Japan passed the judicial labor tribunal system; in 2017, Brazil enacted the use of private arbitration under individual contracts, in addition to the provision in the 1988 Brazilian Federal Constitution allowing for the use of arbitration for collective contracts. There are common themes and comparative contrasts in the uses of arbitration in each country. They may use governmental and/or private structures to house dispute settlement processes of individual and/or collective labor disputes. However, there also are some differences, with Japan keeping the processes largely under governmental regulation and institutions, whereas Brazil provides legal authority to privatize much of the labor and employment law dispute resolution processes. The use of arbitration to settle labor rights disputes in Brazil and Japan, while having different approaches, have similar themes. Understanding their functionalities may present an opportunity for both countries to choose the best practices regarding these different dispute resolution structures. This Article compares the arbitration models in labor disputes in Japan and Brazil, providing guidance for possible improvements of the current systems.

Policy forum: Domestic Tax Arbitration: Some Economic Considerations

In this article, we discuss the economic arguments for and against domestic tax arbitration. Beyond the standard benefits and costs widely discussed by the literature on private arbitration, we emphasize two additional concerns: agency costs (because there is a significant principal-agent problem within the government) and fast lane effect (less public investment in improving tax courts). We conclude that the skepticism echoed by legal economists contrasts with the more optimistic view shared by other legal scholars and policymakers.

Business and Human Rights Treaty: A New Era for Public Participation in International Investment Agreements?

International trade and investment agreements are problematic from a participatory rights perspective because they are typically negotiated without adequate opportunities for participation of the public. Such agreements provide for disputes concerning public policy to be decided by private arbitration, with little or no participation of the people they affect. The business and human rights treaty provides an unprecedented opportunity to create binding obligations on states to ensure trade and investment agreements are drafted and interpreted consistently with their obligation to uphold participatory rights. This thesis examines whether and how the business and human rights treaty could achieve this goal. It concludes that participatory rights should be embedded in the treaty text, with recommendations for what should be included.

Third Party Funding in Arbitration: Questions and Justifications

Utility of third party funding is an undeniable fact, especially where a party is under financial strain, yet its increased usage in private arbitration has given rise to a number of substantive and procedural issues. In view of this, the present paper attempts to map the growing utility or otherwise of the mechanism of third party funding, and analyses its various nuances and legal sustainability within the framework of international arbitration. Further, an attempt is made to analyse the ways and means of ameliorating the utility of third party funding and for enhancing its acceptance in the global arbitration community.

The Indignities of Civil Litigation

Dispute resolution has become increasingly shrouded in secrecy, with the proliferation of protective orders in discovery, confidential settlement agreements, and private arbitration. While many civil procedure scholars have criticized this trend for undermining the systemic benefits of public adjudication, the desirability of secrecy in civil litigation proves to be a much more complicated question. On the one hand, some of those same scholars have recently sought to justify civil litigation in terms that, ironically, highlight the benefits of secrecy. Although this new justification remains somewhat inchoate, it is best understood as a claim that the procedures of civil litigation allow individual plaintiffs to realize one aspect of their dignity — which this Article labels “dignity-as-status” — by empowering them to call those who have allegedly wronged them to account and to thereby reassert their standing as equals. The problem is that civil litigation can also undermine another aspect of plaintiffs’ dignity — which this Article labels “dignity-as-image” — by requiring them to divulge sensitive personal information and thus to cede control over their public self-presentation. Secrecy can help to preserve this second aspect of plaintiffs’ dignity. On the other hand, secrecy can also deprive plaintiffs of a potentially powerful expressive weapon in their quest to hold wrongdoers accountable. In conditions of socioeconomic inequality, weaker plaintiffs can sometimes turn the humiliating aspects of civil litigation to their advantage, intentionally revealing sensitive personal information that emphasizes their lower social status in order to shame their more powerful adversaries. It turns out that civil litigation can indeed promote plaintiffs’ dignity-as-status, but by affording them a venue in which to deliberately compromise their dignity-as-image — to humiliate, as much as ennoble, themselves. Given the complex nature of dignity and the complex trade-off between secrecy’s dignitarian benefits and costs, plaintiffs should be given more control over how much of their personal information is disseminated beyond the immediate parties to a lawsuit — a prescription with implications not only for secrecy in civil litigation, but also potentially for several other prominent procedural issues.

The Governance of Blockchain Dispute Resolution

Blockchain technology acts as infrastructure for self-executing smart contracts. Because contracts are incomplete and some parties are opportunistic, these new contracting possibilities have created challenges of dispute resolution. For instance, will smart contracts be recognised, and any disputes resolved, within the existing courts of jurisdictions? In this paper we first map some institutional governance possibilities for contracting parties (e.g. mediation, private arbitration, courts) to create a Dispute Resolution Possibility Frontier (DRPF). Second, we provide case studies of emerging blockchain-based mechanisms to solve dispute resolution challenges. Blockchain-based smart contracts might not only create dispute resolution problems, but also act as a technology for entrepreneurs to create new mechanisms to solve dispute problems, including those arising from traditional legal contracts. Contracting parties will subjectively interpret their most effective governance mechanism to resolve disputes, and the costs of dispute resolution will change over time through a process of institutional innovation.