Chapter Five: Determining Jurisdiction and Arbitrability - CCA Guide to Best Practices in Commercial Arbitration - Fourth Edition
Editor in Chief James M. Gaitis is a long-standing member of the Texas and Montana state bars, and a former longtime member of the Oklahoma state bar, who, since 1990, has specialized in serving as an arbitrator in complex commercial and oil & gas/energy arbitrations. Mr. Gaitis is the former Director (and Principal Research and Teaching Fellow) of the International Dispute Resolution Programme at the Centre for Energy, Petroleum & Mineral Law and Policy (CEPMLP), University of Dundee, Scotland, where he designed and taught classes on international dispute resolution and advocacy in international oil & gas arbitration to LLM students and professionals. In private practice, he served variously as lead trial counsel, in-house counsel, and special counsel for a diverse array of companies, individuals, and other entities involved in the domestic and international oil & gas industries. He is listed on a broad variety of international and domestic arbitration panels, including the AAA National Energy Panel, Construction Panel, Merger & Acquisitions Panels, and Large, Complex Case Panel; the ICDR’s Panel of Arbitrators and the ICDR’s prestigious Energy Arbitrators List; the British Columbia International Commercial Arbitration Centre; and the CPR’s Oil & Gas/Energy Panel and Cross-Border Panel. He frequently serves as a chair, party-appointed arbitrator, emergency arbitrator, and list-appointed arbitrator in cases involving all aspects of the oil & gas industry, as well as in commercial cases relating to such matters as manufacturing, construction lending, engineering, asset sales, business torts, and real property. Many of his arbitrations, which have included claims in excess of $1 billion, have involved Fortune 100 and Oil & Gas Journal Top 50 companies, as well as national oil companies and international oil companies.
A Fellow of the College of Commercial Arbitrators (2004–present) and a Fellow and Chartered Arbitrator of the Chartered Institute of Arbitrators (2003–present), Mr. Gaitis is a frequently invited speaker and lecturer, has testified in district court proceedings as an expert on arbitrator disclosures and ethics, and is the author of numerous articles relating to arbitration law, several of which have been cited repeatedly to the United States Supreme Court, various federal district courts and federal courts of appeal, and various other courts, such as the Supreme Courts of Texas and Puerto Rico. In 2006, 2010, and 2013, he respectively served first as an Editor and then repeatedly as Editor in Chief of the first, second, and third editions of The College of Commercial Arbitrators Guide to Best Practices in Commercial Arbitration. He also is the Editor of, and a contributing author to, The Leading Practitioners’ Guide to International Oil & Gas Arbitration (Juris 2015) and serves on the Board of Editors of the Journal of World Energy Law & Business (OUP/AIPN). He is a graduate of the University of Notre Dame (BA 1976) and the University of Iowa College of Law (JD 1978), where he served as a Note & Comment Editor on The Iowa Law Review.
Editor John (Jay) McCauley is an arbitrator, mediator, and arbitration consultant. He is a Fellow of the Chartered Institute of Arbitrators (FCIArb) and of the College of Commercial Arbitrators. He is an honors graduate of Harvard Law School and a former partner of a large, international law firm, where he litigated a broad range of matters, including security fraud class actions, corporate governance, insurance and reinsurance coverage, real property, construction, business torts, intellectual property, healthcare, and employment. He has taught arbitration law as an Adjunct Professor in several law schools, including Pepperdine, Loyola, Creighton, and University of Missouri–Kansas City, and has made CLE presentations on ADR topics throughout the world, including, most recently, at the USC/JAMS Advanced Arbitration Institute, and at training programs sponsored by the AAA concentrating on more challenging topics such as arbitrability and jurisdiction, federal preemption, the power to summon nonparties, the preclusive effect of arbitral awards, the role of law in arbitral deliberations, and presentation of damages in the arbitral forum.
Mr. McCauley has been continuously listed for the past nine years as a California Super Lawyer, and for the past eight years, he has been included in Best Lawyers in America in the field of ADR. He has been a commercial arbitrator on the national roster of the AAA since 1998, where he serves on the Large, Complex Case; Commercial; Real Property and Construction; Employment; Healthcare; and Class Action Panels, as well as on the roster of the ICDR. He is also on the roster of neutrals for Judicate West and on the “senior arbitrators” panel for USA&M. In the past decade, he has been appointed to serve as an arbitrator on more than 180 significant matters, including multiple major matters ranging in value from $10 million to more than $100 million.
William G. Bassler, Red Bank, New Jersey
R. Doak Bishop, Houston, Texas
Robert B. Davidson, New York, New York
Richard Chernick, Los Angeles, California
Barry H. Garfinkel, New York, New York
Carl F. Ingwalson, Jr., San Diego, California
Alan M. Kanter, Bloomfield Hills, Minnesota
June R. Lehrman, Los Angeles, California
James R. Madison, Menlo Park, California
The catchall term arbitrability covers what disputes can be lawfully submitted to arbitration. Arbitrators should understand the legal principles governing the extent of their authority to resolve challenges to the arbitrability of the dispute before them and when possessed of such authority, should resolve such issues in a manner that best ensures they adjudicate only those disputes that are legally subject to arbitration.
Arbitrators should (1) recognize what challenges to arbitrability may be made and (2) be familiar with the methodology for making an arbitrability decision when it is theirs to make.
A dispute is not subject to being arbitrated and is therefore not arbitrable unless there is an enforceable written arbitration agreement between the parties or unless it can be shown that a nonsignatory may be deemed a party to a written agreement. Moreover, in order for the dispute to be arbitrable, the following requirements must be met: (1) the scope of the parties’ arbitration agreement must be broad enough to cover the subject matter of the dispute, (2) the arbitration of the dispute must be permissible under the governing law, and (3) any prerequisite to the arbitration of the dispute must have been satisfied. It is not unusual for a party appearing before arbitrators to contend that one or more of these requirements has not been satisfied and that the dispute therefore is not arbitrable and, instead, belongs in court.
When a party to an arbitration raises a challenge to the arbitrability of a dispute, that party and the other party or parties may—expressly or through their conduct—commonly agree, or otherwise provide, that the arbitrators are authorized to decide the challenge. Otherwise, arbitrators must first determine whether it is proper for them, as opposed to a court, to decide the challenge.