Party Autonomy in International Commercial Arbitration

Abstract

As global business expands, the number of business disputes is also on the rise. It is extremely difficult or rather impossible to get all these disputes resolved through the conventional method of courts. Moreover, for international business disputes issues of jurisdiction, law, language, culture, etc. pose additional problems. As the courts all over the world are loaded with unresolved cases, delay in getting justice is inevitable. In such a scenario, businesses have to search new methods of resolution of business disputes and arbitration is one of them. Arbitration is a private court by a private judge. The decision of the arbitrator is called an award, which is binding on the parties. When the business dispute is international in character and is to be resolved with the help of arbitration, it is known as ‘international commercial arbitration.’

The arbitration is a creation of contract between the parties. Hence, party autonomy is the heart and soul of each and every arbitration contract. However, this autonomy is not unbridled. The applicable law and public policy provide the boundaries to this autonomy. Rules of arbitral institutions also curtail the autonomy of parties. Moreover, intervention of courts becomes necessary in cases of bias of arbitrators, misconduct of proceedings, etc. Courts also intervene in setting aside or enforcing an award. It is not uncommon to find courts grappling with issues of party autonomy and in such a process, unfortunately, it takes the back seat.

Issues of party autonomy have been discussed in several judgments of American, English and Indian courts. As the "party autonomy" or the "will of the parties" is central to arbitration proceedings - whether domestic or international, whether commercial or non-commercial - I have a strong view that party autonomy should be given due importance and place vis-à-vis public law. The contours of public law are generally stretched to accommodate any reasonable private law and commercial arbitration is one of them.

This research focuses on a catena of judgments of various courts, primarily the U.S. Supreme Court, the House of Lords and the Supreme Court of India in determining the trend towards acknowledging party autonomy as one of the most important aspects of international commercial arbitration. It shall also look into related issues dealt by the New York Convention and the UNCITRAL (United Nations Commission on International Trade Law) Model Law.