A fair hearing is central to the arbitration process. The selection of qualified arbitrators is obviously an essential prerequisite to a fair hearing. Many of us who are frequently involved in international arbitrations believe that one of the most important strategic decisions made by parties is their selection of the arbitrators to hear their case. Arbitrators, in whatever country they sit, have enormous discretion to review and interpret facts and apply—or even misapply—the law, and to decide what law is applicable. In addition, arbitrators have considerable leeway in how they conduct hearings. Courts will not ordinarily interfere with procedural decisions made by arbitrators unless there is a significant denial of a right, such as the right to present relevant evidence.

There are relatively few non-judicial checks on, or supervision of, how arbitrators exercise their powers. The staff of the International Court of Arbitration of the International Chamber of Commerce reviews terms of reference and arbitration awards for internal consistency, logic, completeness and the like. The American Arbitration Association, on the other hand, does not mandate that arbitrators hand down reasoned awards in international or other arbitrations. As a result, association arbitrators usually issue awards containing only pecuniary conclusions and no reasons. In contrast, under the Commercial Arbitration Rules of the association, arbitrators may fashion remedies of an equitable or similar nature that judges would not be permitted to apply.

Selection of Arbitrators

Parties in international arbitrations ordinarily have some say in the selection of arbitrators. Frequently, they agree, either in their contract or after the dispute has arisen, on a procedure under which each party selects an arbitrator and the two arbitrators so selected choose a chairman. The procedures of the arbitration association involve the selection of arbitrators from lists provided by association administrators, thereby affording at least a veto of sorts to each party.

Such opportunities of parties to international arbitrations to have some say over the selection of arbitrators are, unfortunately, often not taken full advantage of. Often persons involved in international arbitration are not aware of persons with appropriate backgrounds and capabilities to serve as arbitrators. Simply because a person is a lawyer, or even a litigator, does not mean that he or she will be an effective arbitrator.