Litigation
Jun. 22, 2002
Spreading the News
Although mediation has gained popularity in recent years in the United States as a way to avoid litigation, on an international scale, arbitration is still most often the way to resolve a dispute out of court.
Although mediation has gained popularity in recent years in the United States as a way to avoid litigation, on an international scale, arbitration is still most often the way to resolve a dispute out of court.
But times may be changing as neutral services such as JAMS, American Arbitration Association and ADR Services are tapping into the business of alternative dispute resolution on an international level.
On May 1, Century City-based ADR Services, run by president Lucie Barron, hosted a visit by Dr. Robert Briner, chairman of the International Chamber of Commerce's International Court of Arbitration, and attorney Lorraine M. Brennan, the International Chamber of Commerce's director of arbitration and ADR for North America and legal counsel of the United States Council for International Business.
They spoke to retired judges and attorneys who work full time as mediators and arbitrators about how the world's foremost institution in the resolution of international business disputes operates throughout the world today.
"We know the success that ADR has had in domestic environments like America and England and would like to get a feel for what the experience has been on an international level," Briner said. "The American aspect of arbitration is to have retired judges to do it - that is not as common in Europe."
Briner and Brennan spoke with 21 members of ADR Services' panel, which is made up of both retired judges and attorneys who work as neutrals.
The speakers and the audience seemed interested to learn from each other how arbitration and mediation work on an international level, how mediators in the United States can get involved in dispute resolution between parties from different countries and how ADR is evolving everywhere so that all organizations involved can coordinate their efforts.
Briner, based in Geneva, and Brennan, based in New York, work all over the world. They stopped in Los Angeles on their way to the 34th World Congress of the International Chamber of Commerce in Denver from May 6 to 8.
Barron invited the pair to come talk to her neutrals after several years of investigating international ADR.
"About four years ago, when I was working on what I called the ADR Services Secret Plan for International Expansion, I spent a lot of time trying to find out what ADR procedures were around the world," she said. "I thought, 'How can the ICC, who handles some 600 cases a year, know all the different great neutrals who are out there?'"
Barron said that because private-sector neutrals are mostly an American phenomenon, she wanted to introduce the International Chamber of Commerce to her panel, and vice versa.
"I wanted the neutrals here to have a sense of what the ICC is and wanted the ICC to have a sense of the quality of neutrals who are available in the private sector," Barron said. "These cases are very prestigious, and it's a great honor to work on them."
The International Chamber of Commerce was formed in 1919 after the end of World War I to promote free enterprise and international business, with the mission of trying to prevent future world wars.
The chamber's International Court of Arbitration was formed in 1923 and today has more than 12,000 arbitrators worldwide. Members of the court are appointed for three-year terms.
Briner has been chairman of the court for the past six years.
The court is called in to resolve international business disputes between parties from different countries. The court uses a single arbitrator or sets up a three-person tribunal of party-appointed arbitrators who must be independent from the parties involved, Briner explained.
The court can replace arbitrators if necessary, and it scrutinizes awards before the parties are notified, "as a sort of built-in control system," he said.
"Arbitrators submit their draft to the court, which can draw attention to questions of substance," Briner said. "Last year we had arbitrations taking place in 42 countries around the world."
While American ADR Providers, such as ADR Services and JAMS, charge set-up fees or require deposits for arbitrations in the neighborhood of $50 to $250, the set-up and arbitration fees for International Chamber of Commerce arbitrations can run into the thousands of dollars.
In 2001, amounts in dispute in the international arbitration court ranged from less than $50,000 to more than $1 billion. More than half the cases involved amounts greater than $1 million, Briner said.
American neutrals frequently are called upon to help resolve conflicts among parties from countries other than the United States.
But international business disputes call for mediators or arbitrators who have specific skills not often required in domestic dispute resolution.
"ICC arbitrations may take longer than most because they haven't gone through the court," Briner said. "The exchange of briefs, discovery - these can all take a long time. Here, you're really starting from scratch."
Along with the time commitment, arbitrating a Chamber of Commerce case often means knowing several languages fluently, and it can require the neutral to be away from home for long periods of time.
"Sometimes they have some very unusual requirements," said Barron, whose company has had several referrals from the court but has been unable, so far, to take on any of the cases. "You can be out of commission if you work on them because they can take months, but still, I'm sure if they had the chance, many neutrals would like to do it."
Yet simply speaking a foreign language and being willing to travel does not a Court of Arbitration arbitrator make.
"Experience is important," Brennan said. "We're not going to take a 25-year-old straight out of college. We work with parties from more than 100 countries, and it can get complicated."
Most people who work with the Court of Arbitration get their first experience doing so through a law firm, she said.
Briner pointed out that some of the quirks of international dispute resolution can be tricky.
"Small cultural differences can be very important," he said. "Shaking a finger, looking witnesses in the eye or standing while addressing people - these actions could all be perceived as being too aggressive."
Several of the neutrals who listened to the worldly pair talk about the Court of Arbitration remained enthusiastic about participating in global arbitration and mediation.
"The appeal of this organization is that people can be very adverse to international litigation," retired Judge Eli Chernow said. "They're horrified at the costs and procedures. The ICC allows parties to avoid going to court to resolve their differences."
Attorney and mediator Roy Aaron agreed.
"In the U.S., there's a growing understanding and awareness of the opportunities for mediation that I think will eventually spread abroad," Aaron said.
Sandra Corrales
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