Proctor : June 2017
40 PROCTOR | June 2017 #Small practice subscription $77 per practice, per month. Allows up to 5 users, at no extra cost. www.cabenet.com.au Legal accounting from $15.40 per user # E.O.F.Y RESOLUTION Change to comprehensive, easy-to-use legal accounting from Compliance certified legal practice software Assessing the liability of international arbitrators Will caveat emptor warnings be given in future for arbitral institutions’ dispute resolution services? Will lawyers add a new field of expertise to their wares called ‘arbitral institution liability’? The Liability of Arbitral Institutions: Legitimacy Challenges and Functional Responses, by Alicja Warwas, may foretell these prospects. Warwas’ main thesis is that arbitral institutions are liable for their services to party users, and that this liability is desirable. Why? Reasons include the public roles said to be played by private arbitral institutions; their lack of accountability for their increasing powers to appoint arbitrators; protracted, confusing and more expensive arbitrations; concerns about the staffing and non-transparent networks of people who allegedly run arbitral institutions; and, the multi-faceted functions of arbitral institutions which transcend private interests into public territory. These issues conjoin with clarion calls about the ethics (or lack thereof) of international arbitration’s players, including arbitral institutions. As arbitral institutions’ birth rates explode globally, Warwas contends that the regulation of their accountability and liability to party users is inadequate, due to convoluted contractual obligations. The book contains a breathtaking level of detail on the salient rules and operations of at least four of the world’s leading arbitral institutions. The analysis considers three dimensions of arbitral institutions’ functions – legal, societal and economic – contending that arbitral institutions are powerful players with new substantive and procedural powers in and beyond international arbitration itself. Title: The Liability of Arbitral Institutions: Legitimacy Challenges and Functional Responses Author: Barbara Alicja Warwas Publisher: TMC Asser Press Springer 2017 ISBN: 978-94-6265-110-4 Format: hardback/388 pages RRP: $115 (Amazon) According to Warwas, arbitral institutions do not just manage arbitrations; they are said to design international arbitration proceedings so they can “play with the mandate and discretion of institutional arbitrators and with core principles ... such as party autonomy” (5). Warwas thus examines how arbitral institutions can be held accountable for their power and be made liable for poor performance of their contractual obligations to party users (191), concluding with a discussion of proposed models for arbitral institutions’ liability, such as new liability clauses and public support. This reviewer suggests that this book is a portent of an inevitable calamity facing international arbitration (including public investor-state treaty arbitration). When a dispute resolution system becomes the source of disputes itself, this surely manifests a crisis. Warwas’ book also potentially raises broader questions, including whether international arbitration is infected with ‘rentier-capitalism’, such that wealthy multi- national elites represented by major law firms of certain jurisdictions now effectively use (or abuse) the system for rent-seeking extraction – via global disputes (see Guy Standing, The Corruption of Capitalism, Biteback Publishing 2016). Some consider arbitral institutions to have successfully offered efficient and ethical commercial dispute resolution services for decades, if not centuries. Giving multi- national elites and their law firms new opportunities to sue arbitral institutions suggests the possible existence of other agendas that require closer scrutiny. Warwas’ book thus perhaps needs to be read cautiously alongside other books on arbitral institutions (for example, Rermy Gerbay’s The Function of Arbitral Institutions, Kluwer 2016). Warwas’ thesis may also need to be verified with empirical research on the actual standards of arbitral institutions’ services, conducted by those who are independent of international arbitration. – Magdalene D’Silva Magdalene D’Silva is a university associate at the Faculty of Law, University of Tasmania.