Originally from Journal of Damages in International Arbitration

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MR. WALCK: This is a Q&A panel. We have a group of half a dozen very experienced arbitrators, counsel, experts and we have sitting at the far left as you look at them three students from Queen Mary who will be posing some questions. The bios of our panel are in your materials and they are all probably well known to everyone in any event, so I won’t delay things with separate introduction for them but let me introduce the students for you.  Starting from the left, Diego Alvarez is a Mexican lawyer with a focus on energy law, construction and international arbitration. Diego at present is undertaking a placement with Clifford Chance here in London for the next four months. Next to him is Lilit Nagapetyan, who wears two hats. She is not only a qualified lawyer, but she is also a chartered accountant practicing forensic accounting at Smith & Williamson with a focus on damages and valuation in both litigation and arbitration. And finally, on the right Abeer Sharma is an Indian-based lawyer with expertise in public policy and economics, currently researching with Queen Mary University’s Energy Law Institute.  

I would like to take the moderator’s prerogative to post the first question for the panel. One of our participants this morning bought up Professor Stern’s dissent in a Bolivian matter. It came up in the context of the choice that some tribunals have allowed claimants of what date to value their award when you have an unlawful expropriation. Professor Stern argues that, whether it is lawful or not, you should value it at the time of taking, but if its unlawful you can then add lost profits up to the time of award. This morning Maurice Mendelson said that restitution is the preferred form of squaring the ledger. Restitution means at the time of award you get back your investment, so you’re getting back something as of the date of award. He would then add on lost profits from the time of the taking to the time of restitution. So if you have restitution, you get the value of the time of award plus lost profits, but in Prof. Stern’s world, if you have no restitution you get a value at the date of the taking plus lost profits. I want to toss that out for reaction from our panel. Is one of those preferred over the other? Is this in a state of flux where there is no single answer? I will add the caveat that some of our panelists may not be able to opine because they are appearing in front of Prof Stern or are sitting on a tribunal with her, and we understand that. Mark, why don’t you kick it off.