Challenging Arbitrators - Chapter 6 - Practical Guide to International Arbitration
Originally from Practical Guide to International Arbitration
To safeguard the integrity of the arbitral process, sometimes a party will deem it necessary to try to remove one or more arbitrators from the tribunal. The process is analogous to seeking the disqualification or recusal of a judge in domestic court.
Successful challenges are rare. It is not easy to reverse the arbitral appointment process. Given the formalities of appointment, it makes sense that a party may not simply elect, without more, to remove an arbitrator from the tribunal once the proceeding is underway. Formal challenge procedures are necessary. Those procedures, as with most matters in arbitration, are rooted in the arbitration agreement between the parties. In particular, the relevant procedures governing a challenge may be found in the applicable arbitration rules chosen by the parties or, alternatively, in the legal framework of the arbitral seat selected by the parties.
Of critical importance, the challenging party must justify the request on substantive grounds relating to the arbitrator’s disposition or qualifications to decide the dispute. That party shoulders a heavy burden. Successful challenges often target an arbitrator’s unethical action, misconduct, bias, conflict of interest, or failure to comply with the applicable arbitration agreement. In essence, a challenge against an arbitrator must demonstrate that the arbitrator being challenged is not sufficiently independent, impartial, or otherwise suitable to decide the dispute.
When a party does decide to challenge an arbitrator, that party must act promptly. Failure to do so could result in a finding of waiver.
Whether or not to raise a challenge must be one of the most carefully considered decisions for users of the arbitral process. In-house counsel should consider all potential ramifications before pursuing a challenge. The majority of challenge applications are not sustained and an unsuccessful attempt may poison the remainder of the arbitral process. For example, it may prompt a retributive challenge from the opposing party, an overly defensive approach taken by the tribunal, or a cost award against the challenging party.