Distorted Mirrors: Perceived Disagreements Obfuscate the General Principle of Law that a Heightened Standard of Proof Applies to Corruption Allegations in Investment Arbitration - Chapter 12 - Investment Treaty Arbitration and International Law Volume 9
David H. Weiss Senior Associate, King & Spalding LLP, Houston, Texas; J.D. University of Texas School of Law, 2006.
Distorted Mirrors: Perceived Disagreements Obfuscate the General Principle of Law
that a Heightened Standard of Proof Applies to
Corruption Allegations in Investment Arbitration
David H. Weiss
Corruption is not a new phenomenon, and allegations that someone engaged in corruption in a civil legal proceeding are not new, either in domestic legal proceedings or in international disputes. The various legal proceedings under various laws in which corruption allegations have been adjudicated have almost always required that such serious allegations be proved by an elevated standard of proof. In other words, whereas most disputed facts are adjudicated under a “preponderance of the evidence” standard or some standard roughly akin to it (“preponderance”), corruption allegations have required more confidence. While different authorities applying different laws have used different terms that, at times, represent mild conceptual differences, the common denominator has been the conclusion that a 51% chance that the alleged act of corruption occurred is inadequate. In fact, in many, if not most, of these legal authorities and systems, a heightened standard of proof is not limited to corruption allegations, but extends to other allegations regarding deceit, such as fraud, and other particularly important legal interests, such as parental rights and liberty.
Most investment tribunals have also applied a heightened standard of proof when faced with corruption allegations. Some recent authorities, however, have declined to apply a heightened standard of proof when adjudicating corruption allegations and thus created a conflict (or at least a perceived conflict) in investment jurisprudence on this issue. But upon closer analysis, it is not clear whether the substantive differences between these recent authorities and the majority view, which demands a heightened standard of proof, are more a matter of form or one of substance.
This paper explores the appropriate burden of proof and standard of proof regarding allegations of corruption in international investment arbitration. First, it explains that the normal “burden of proof” rule—namely, actori incumbat probatio (he who asserts must prove)—also applies to allegations of corruption. Second, it demonstrates how the substantive law applicable to the claims and defenses affects the analysis of who bears the burden regarding specific disputed facts. Third, the article briefly considers the role that a choice-of-law analysis might bring to bear in rare instances regarding which standard of proof should apply to corruption allegations. Fourth, the article examines authorities that have adopted the majority view regarding standards of proof applicable to corruption allegations—namely, that a standard of proof more demanding than the preponderance standard, such as the “clear and convincing” standard, should apply. Fifth, it analyzes the authorities that have declined to follow the majority view. Sixth, the article concludes by arguing that analysis of all of these authorities illustrates that the apparent differences between the majority and dissenting authorities in most instances are more perceived than real, and that the principle that a heightened standard of proof should apply to corruption allegations is a general principle of law that investment tribunals should always apply absent controlling law to the contrary.