Settlement Facilitation - Ten Years of Swiss Rules of International Arbitration - ASA Special Series No. 44

Author(s):

Markus Wirth

Page Count:

8 pages

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1 PDF Download

Published:

October, 2014

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Good morning everyone. I am glad to stand in for Peter Nobel.
He is an esteemed colleague of mine and I wish him all the best for a

quick recovery. He was supposed to speak about settlement

facilitation, so that is the topic I will address.

1. THE PROS AND CONS

By settlement facilitation I understand facilitation by the

arbitrators. The question is: should it be the rule, should it be an

exception or should it be an absolute no go? The approach to that may

depend on one’s legal background, culture, and social traditions. The

same applies to a certain extent to the approach taken by arbitral

institutions. Depending on where they are located they may be more

open or not towards settlement facilitation.

Let me first briefly address the most repeated reasons for the

facilitation of a settlement by the arbitral tribunal and those against it.

They are obvious.

First of all, a settlement, if successful, saves time and costs;

secondly, a settlement may preserve business relationships; and, third,

an often-heard argument is that arbitration is not war but a consensual

process so settlement fits the process.

By contrast, there is a widespread approach that says arbitrators,

just like judges, should keep to their role: decide the case and not help

to reach compromises. A second concern is that if the facilitation fails,

the orderly completion of the arbitration may be at risk. I will come

back to that.

If we take a step back and look at the arbitral institutions and how

they reflect these contrary approaches, we will note that the vast

majority of institutional arbitration rules do not even mention

settlement facilitation by arbitrators. I refer for instance to the Rules of

the London Court of International Arbitration; the United Nations

Commission on International Trade Law (UNCITRAL) Rules; the

Rules of the International Centre for Dispute Resolution; the Vienna