26 Apr 2019
L-R: The Rt Hon Lord Neuberger of Abbotsbury; Paul Rose FCIArb C.Arb Chair, London Branch at the event on 25 April 2019 in London
Lord Neuberger became an international arbitrator at One Essex Court after retiring from presidency of the Supreme Court of the UK. His practice covers a wide range of international business and public law areas.
The first part of his address dealt with his experiences in becoming an arbitrator after a judicial career. He contrasted the nature of a judge, a public position upholding the rule of law, with the private, contractual nature of arbitration. A judge has case management duties to ensure efficiency and proportionality, almost a policing function, whereas an arbitrator is more of a negotiator, deciding with the parties what procedural rules they want, and generally, not interfering if the chosen procedures result in longer and costlier proceedings than other alternatives.
Lord Neuberger examined the contention that some public duties and some transparency should be imposed on arbitrators. He felt that to require this in all arbitrations would be to undermine the confidentiality that makes arbitration attractive. However, there is a case for greater transparency in some areas e.g. investor-state arbitrations and public procurement, and he noted that Brazil and France required scrutiny of some awards, and UNCITRAL has published its Rules on Transparency in Investor-State Arbitration.
Lord Neuberger considered whether arbitrators should, like judges, always apply the law, even if it gives rise to an unfair result. He noted a possible temptation for arbitrators whose decisions will not be examined to make an award that is fairer and more flexible and pragmatic than a strict application of the law provides. He felt that this should be resisted. Aside from being wrong in principle, he felt that serious abuses could arise if arbitrators considered themselves to be above the law, and the reputation of arbitration could be impacted as parties would feel the results may be very uncertain.
The second part of Lord Neuberger’s address examined the impact Brexit may have on London arbitrations. He referred to a recent survey (whitecase.com/arbitration-survey-2018), which indicated that those surveyed thought Brexit was unlikely to have a significant impact on London as a centre for arbitration, but that if it did, Paris would benefit most.
Lord Neuberger reflected that given the type of Brexit is still unclear, it is difficult to identify specific risks to London as a centre for arbitration, but that there must be fewer risks the closer the ongoing relationship with the EU. Any negative effects of Brexit are likely to be reputational as in some quarters it may be viewed as undermining the UK’s traditionally international outlook. This might affect whether arbitration professionals wish to base themselves in London. However, there may be benefits from Brexit. For example, the enforceability of awards depends on the New York Convention, which is unaffected by Brexit, but judgments of courts in the UK may prove more difficult to enforce in the EU post-Brexit when mutual enforcement arrangements no longer apply. This could make arbitration more attractive than court proceedings. After Brexit, courts in the UK may be able to stay litigation even in EU countries, which is not possible now. This would be an advantage for London compared with Stockholm or Paris. Problematic EU case law would not apply. As regards the impact on English law as the contractually applicable law, Lord Neuberger doubted that Brexit has any relevance, as membership of the EU had no relevance in that regard.
There followed a wide-ranging Q&A session and drinks reception. The event was held in the Oxford and Cambridge Club, in London’s Pall Mall.
Video recording from the event is available here.
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