Controlling Efficient Conduct and Quality of the Proceedings - Chapter 7 - Arbitral Institutions Under Scrutiny: ASA Special Series No. 40
Daniel HOCHSTRASSER is the Senior Partner and heads the arbitration group of Bär & Karrer AG. He graduated from the University of Zurich Law School in 1986. He spent one year in the legal department of an industrial company in France and two years at a Zurich District Court, and served three years with the Zurich Court of Appeals and the Zurich Court of Cassation (Supreme Court). After one year in the US (Cornell Law School, LL.M., 1993), he joined Bär & Karrer. In his practice, Hochstrasser concentrates on commercial litigation and international arbitration. His primary focus is on representing parties in complex disputes arising out of M&A transactions, industrial and infrastructure projects, banking and finance, and licence agreements. In addition to representing parties, Hochstrasser is frequently chosen as party-appointed arbitrator and chairman of international arbitrations, most of them under the Rules of the ICC or the Swiss Rules, but also other institutions or ad hoc arbitrations. He is frequently lecturing on arbitration in Switzerland and abroad.
1. MAJOR ADVANTAGES OF ARBITRATION
It is like a mantra repeated by every author and commentator on arbitration that arbitration offers parties a more efficient way to resolve disputes which, in addition, has the potential to lead to more satisfactory outcomes in terms of the quality of the decisions. This argumentation aims at convincing contract parties to chose arbitration not only because arbitration provides for a neutral forum (as an alternative to litigating in the home courts of one of the parties), but also because arbitration is somehow a quality-wise superior method. As far as efficiency is concerned, two advantages are pointed out usually, namely on one hand that arbitration is faster than court procedures (i.e. it takes less time until an enforceable decision has been reached), and that resources are spent in a more economical way. Already the general title of this Conference (Arbitral Institutions under Scrutiny) indicates that the general praise of arbitration is not shared universally, and that there are critical voices as well. I would in fact submit that all of the above arguments could be countered with actual cases where the opposite was true. Just use the opportunity of one of the many arbitration conferences and listen to the war stories shared by seasoned practitioners—of course none of which would be repeated on a panel.
The aim of this article is to give hints how arbitral institutions could contribute to deflecting and hopefully eliminate the critical voices against arbitration. Or, should we simply accept that, in spite of advantages such as enforceability of decisions under the New York Convention, neutrality and confidentiality, arbitration is about to lose its reputation due to teh fact that it is not as efficient as it was once said to be?