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The final question addressed in chapter three is one that continues to arise in practice and to engender debate: the authority of a truncated tribunal to proceed to issue a final award. The issue comes to the fore when a party-appointed arbitrator resigns or otherwise refuses to participate in panel deliberations, whether unilaterally or at the behest of his or her appointing party. The jurisprudence on this topic has developed significantly with the trend towards judicial (rather than diplomatic) arbitration, in large measure as a result of a series of decisions by the Iran-United States Claims Tribunal and the confrontation of this problem in arbitral rules. There is a discernible preference among tribunals, institutions, and scholars to replace the obstructionist arbitrator and thereby prevent the need for a truncated tribunal. Where this is not in the circumstances feasible, the authority of the remaining two members to proceed to a final determination is widely accepted. Either way, the trend has been to continue to fortify international arbitration against unilateral attempts to derail the proceedings.
One of the most striking features of arbitral practice over the past three decades has been how old problems have continued to arise in new guises. This is particularly apparent with the problem of States’ various attempts to negate arbitration, and whether denial of justice may be invoked to confront that practice. This issue is considered in the second chapter of this book. The practice since the time of the first edition of this book underscores that governmental evasion and negation of arbitration can take a number of forms. Arbitral tribunals, and in particular those constituted under bilateral investment treaties, have responded to new attempts at governmental negation of arbitration. The question today is not only whether a State’s refusal to arbitrate may constitute a denial of justice, but whether a State’s attempt to negate arbitration—by, for example, improperly setting aside an international award—may constitute a compensable expropriation of property rights, a breach of fair and equitable treatment, or another breach of an investment treaty.
The severability of the arbitration agreement, a cornerstone principle of international arbitration that is considered in the first chapter of this book, is more firmly established now than it was three decades ago. Yet respondents still from time to time call that principle into question by attempting to vitiate the arbitral process by invoking a (supposed) defect in the underlying contract or treaty, while difficult issues also remain concerning the precise scope and limits of the principle. These issues underscore the merit in analyzing and revisiting what remains a jurisprudentially subtle and practically important question.
The vitality or, alternatively, vitiation of the international arbitral process remains a pressing subject. The explosion of inter-State, investor-State, and international commercial arbitration in recent years magnifies the importance of the subject. This second edition combines the historical analysis of the first edition with a survey of the continued salience and contemporary developments for each of the three problems identified: (i) the severability of the arbitration agreement; (ii) denial of justice (and now other possible breaches of international law) by governmental negation of arbitration; and (iii) the authority of truncated international arbitral tribunals. The international arbitral process continues to be fortified against unilateral attempts to derail it and, to that end, this book will be a valuable guide for practitioners and scholars alike.
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