Originally From Arbitration Law of Sweden: Practice and Procedure

The Arbitrators

5.1 Introduction

The arbitrators’ main task is to settle a dispute for the parties and to do so in an impartial, practical and speedy manner. The arbitrators have procedural powers and duties, while the parties, conversely, are obliged to remunerate them for their services.

When defining the arbitrators’ powers and duties more closely, one must begin by attempting to clarify the legal foundations of their mandates. By the same token, the origins of the rights and obligations of the parties themselves must be considered. Two main explanatory models have been launched in the international doctrine. Firstly, the arbitrators’ mandate has been deemed to constitute a species of trusteeship agreement, often called the arbitrator contract. This explanatory model has been closely studied over a period of many years.1 In contrast, there is the view which says, basically, that the arbitrators’ powers and duties are defined by statutory rules, albeit that the parties, by agreement between themselves, can modify and terminate the arbitrators’ mandate. This theory has generated less interest in the international literature.2

The contract theory, which until recently had been taken for granted in Swedish doctrine,3 has run into difficulty as soon as an attempt has been made to explain how the arbitration mandate originates. Unlike an ordinary trusteeship agreement, which as a rule involves only two parties, an arbitrator appointed by one party is deemed to have a mandate from both parties to settle a dispute impartially. It has been stressed that the same contractual conditions should apply to both parties.4 It is hard to explain how an arbitrator appointed by one party has also been mandated by the other. Often the argument is raised that one party has received a tacit power of attorney from the other. This in itself can seem far-fetched, considering that neither the Swedish Arbitration Act nor the arbitration agreement says anything about the parties issuing one another with powers of attorney.5