Originally from:

AAA Handbook on Arbitration Practice - Second Edition

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CHAPTER 15

WHY NOT PROVIDE FOR NEUTRAL
PARTY-APPOINTED ARBITRATORS?

Robert D. Taichert

I. Introduction

The common procedure to constitute an arbitral panel is for each
party to appoint its own arbitrator. The party appointed arbitrators then
select the third arbitrator, who serves as the chair. The parties naturally
select as their arbitrator a person who is most likely to favor their side of
the case. This can lead to party appointed arbitrators becoming advocates
for the side which appointed them. There are situations in which the
parties to a contract want to be sure of the complete objectivity of arbitral
proceedings and to achieve that, provide for neutral arbitrators with no
connection to the party which appointed them. This article suggests that
the way to provide for neutral three member panel arbitration is to
specify in the arbitration section of the agreement that party appointed
arbitrators will not know which side appointed them. This only works in
an administered arbitration with a neutral service provider serving as
intermediary. The parties agree that the case administrator will notify the
party appointed arbitrators of their selection and inform them that they
are not to know which side appointed them.