Introduction:

International commercial arbitration[1] is a system of dispute resolution that permits parties to submit their disputes to a neutral non-national tribunal. The non-national tribunal is expected to apply its independent and impartial judgment to the determination of those disputes, in accordance with the applicable law in relation to both substance (governing law[2]) and procedure (usually the law of the seat of the arbitration). In some circumstances, the laws of evidence under the applicable procedural law may apply in international arbitration proceedings.

However even when strict laws of evidence do not apply, the practice of the taking of evidence in international commercial arbitration proceedings almost always will be influenced by the legal background and cultural expectations of the parties, counsel and the arbitrators involved.

The laws of evidence are the rules that govern the relevance, admissibility and weight of documentary and oral evidence tendered by a party in order to prove or disprove a fact in issue in the course of legal proceedings.  The nature of those rules is often significantly different in common law countries and civil law countries. Furthermore, the practices and procedures that apply to the taking of evidence in legal proceedings, including the preparation and presentation of documents, witnesses of fact, expert witnesses and inspections, and the actual conduct of evidentiary hearings, vary significantly from country to country and across different legal systems.

Broadly speaking, in common law countries[3] litigation proceedings are adversarial in nature. The role of the judge is to apply the rules of evidence, which are detailed and complex, to determine the relevance and admissibility of documents and testimonial evidence tendered by each party. Any evidence tendered by one party in support of its case may be subject to legal challenge by the opposing party. It is the judge’s role to act as referee in disputes relating to the relevance and admissibility of evidence and he or she ultimately will determine whether or not evidence tendered by a party is permitted. The judge (or jury) must come to a decision based on the evidence that is presented by the parties and permitted by the judge.

In civil law countries[4] on the other hand, the judge will usually assume a far more inquisitorial role in litigation proceedings, actively taking part in the conduct of the hearing and the questioning of witnesses. The judge may obtain evidence directly from a witness. Consequently, under civil law systems the need for strict technical rules of evidence is less important because the judge is expected to play an important role in ensuring that all of the necessary and proper evidence is properly before the court. Therefore, the admissibility or relevance of evidence in civil litigation is not subject to legal challenge in civil law countries to the extent that it is in common law countries.

In international arbitration, counsel and arbitrators need to be able to bridge those differences in order to conduct proceedings in a neutral and equitable manner. To that end it is now common, even in common law countries, for parties and arbitrators to depart from the application of the strict laws of evidence relating to the relevance and admissibility of evidence. Some national arbitration laws in common law jurisdictions (such as the Arbitration Act 1996[5] in England and Wales) even expressly state that a tribunal is not bound to apply strict laws of evidence (meaning strict common law principles) in arbitral proceedings and, frequently, parties will agree to the application of international rules of evidence, such at the International Bar Association Rules for Taking Evidence in International Commercial Arbitration (the “IBA Rules[6]”). This paves the way for a less formal and more ‘international’ treatment of the taking of evidence in international arbitration.

Despite this, it remains important for practitioners in the field of international commercial arbitration to have some understanding of the main differences in the practice of taking evidence as between common law and civil law countries.

Documentary evidence:

One key difference relates to the treatment of documentary evidence. For the purpose of this discussion, ‘documents’ include any written or printed material capable of being made evidence. Given recent technological advances, in most jurisdictions it is well-accepted that the definition of a document must extend well beyond conventional ‘paper documents’ and will cover a wide range of media including computer records, tape recordings, television film and photographs.

Documents are central to the arbitral process and, often, the most important and valuable evidence available to the tribunal. First, arbitral proceedings are, by their nature, less formal than court proceedings, in particular witnesses may not be under oath in the same way as when giving oral evidence in a common law court. The effect of that, coupled with the different philosophies as to the role of witness evidence (discussed below), is that tribunals often place greater reliance on documentary than testimonial evidence. Secondly, international commercial arbitration usually involves the presentation of a party’s case in full and in writing from the outset (usually in the form of written submissions, sometimes referred to as ‘Memorials’, written witness statements, supporting documents and, if appropriate, written experts’ reports). This puts the documentary evidence, together with written submissions and written statements, at the forefront of a party’s case. Thirdly, documents can be a less time consuming and less expensive form of adducing evidence than the production of witnesses and, therefore, documents are frequently relied on heavily by parties. The importance of the role of documents in international commercial arbitration is therefore, a universal concept. However, what is not universal is the method of obtaining documents, particularly from the opposing party, to which parties are accustomed.

The approach in litigation in many civil law jurisdictions has always been one of upfront disclosure, whereby a party is expected to submit the substance of its case, including the evidence that it relies on, from the commencement of the proceedings (or soon thereafter). Full disclosure of one’s case from the outset is not the same thing as full disclosure of documents. Document disclosure[7] in civil law jurisdictions has always been less onerous than in common law jurisdictions. A party is required to produce those documents that it relies on in support of its submissions. Therefore, it is not necessary for a party to disclose to the opposing party documents that are harmful to its own case or to respond to broad or searching requests for documents.

The civil law practice of submitting one’s case in full to the judge and to the opposing party from the outset, and permitting the judge to take an inquisitional role toward fact-finding, carries its own checks and balances. The judge in civil law jurisdictions will place a great deal of emphasis on the rules relating to burden of proof.

In international commercial arbitration a practice has evolved that goes some way toward reconciling the differences between the various jurisdictions. A commonly adopted procedure is for the tribunal to make orders for the production of documents pursuant to a carefully drafted, reasonable request for a particular document or documents and, if the order is not complied with, the tribunal may draw appropriate adverse inferences in respect of the documents in question.  It is not uncommon for there to be no formal disclosure (or discovery) phase in international commercial arbitration proceedings as such, unless the parties agree otherwise.

The evolving common practice in international commercial arbitration is reflected in the IBA Rules, which were drafted by a working group comprised of both common law and civil law experts. The IBA Rules are specifically designed to be acceptable to lawyers from both common and civil law backgrounds and will apply to international commercial arbitration proceedings when the parties agree or the tribunal orders. They do not take precedence over applicable national laws governing procedure, or applicable institutional or ad hoc rules, but rather supplement those laws and rules.

In the absence of the application of the IBA Rules, the national law of the seat of the arbitration may have a significant impact on the conduct of document disclosure in international commercial arbitration proceedings. Under English law for example, a party to arbitral proceedings may use the same court procedures as are available in relation to legal proceedings in order to secure the attendance before the tribunal of a witness to produce documents. However, such procedures may only be used with the permission of the tribunal or the agreement of the parties and, even then, only if the witness is in the UK and the arbitral proceedings are being conducted in England and Wales or Northern Ireland. In other jurisdictions it also may be open to the parties to apply directly to the national court to order a party to produce documents, and seek sanctions if it fails to do so.

Written Witness Statements:

Under common law legal systems, the written witness statement[8] is a relatively new instrument in litigation (and it is by no means used in all common law countries). Traditionally, witnesses would be expected to attend the hearing and, at the hearing, would present their evidence in full in the course of examination-in-chief by counsel for the party seeking to rely on that evidence. Counsel for the opposing party would be entitled to cross-examine the witness and, following cross-examination, the original party’s counsel would be entitled to re-examine. The judge (or jury) would not be expected to have an active role in independently questioning the witness.

In international commercial arbitration, the IBA Rules contain a ‘middle ground[9]’ approach, which reconciles the major differences that exist between the common law and civil law systems. The IBA Rules provide that parties may be ordered to submit written statements within a particular period of time. They provide that such witness statements must include a number of details including a full description of the witness and his or her present and past relationship with any of the parties, a description of his or her background, qualifications, training and experience (if relevant and material to the dispute or the contents of the statement), a full and detailed description of the facts, the source of the witness’s information as to those facts, an affirmation of truth and the signature of the witness as well as its date and place.

As written witness statements are now widely used in international commercial arbitration, most experienced international arbitrators are aware of the issues faced by lawyers from different legal systems and will ensure that adequate safeguards are in place to avoid any procedural disadvantage to one party. However, parties should bear in mind that the weight that the members of a tribunal will be prepared to give to written witness statements will be determined to a large degree by the background of the arbitrators themselves.

Oral Witness Testimony:

As outlined above, oral witness testimony in common law jurisdictions comprises the examination-in-chief, cross-examination and re-examination of witnesses of fact. In recent years, in litigation in many common law jurisdictions, the role of examination-in-chief has become largely superseded by the written witness statement (although this is certainly not the case in the US).

Most participants in international arbitration proceedings now recognise that, quite appropriately, common lawyers may be closely involved in the preparation of witness evidence, including written witness statements. In turn, common lawyers also expect witnesses to be subjected to fairly intensive cross-examination[10] by the opposing party’s counsel (such cross-examination being intended to provide an effective check and balance to the testimony in chief). However the practice of intensive cross-examination by opposing counsel remains a foreign concept to many civil lawyers who expect the judge to assume the role of inquisitor. Civil lawyers not trained in the skills of cross-examination may find themselves at a disadvantaged position vis-à-vis their common law counterparts (although an experienced tribunal will seek to level the playing field between the parties’ representatives). Common lawyers, on the other hand, may be taken by surprise by the active role taken by civil law arbitrators.

In practice, in most international commercial arbitration proceedings the tribunal will permit the cross-examination and re-examination of witnesses. However, the tribunal itself is also likely to put questions of its own to the parties’ witnesses. The IBA Rules again set out the ‘middle ground’ that has evolved in respect of the presentation of oral witness evidence at hearings. The Rules provide that each witness who has submitted a written witness statement must appear for testimony at an evidentiary hearing unless the parties agree otherwise

There may be situations where a party will wish to enforce the attendance of a witness at a hearing. In those circumstances, the party must look to the applicable procedural law of the arbitration (usually the law of the seat) for assistance. Under English law, for example, a party to arbitral proceedings may use the same court procedures that are available in relation to legal proceedings to secure the attendance before the tribunal of a witness in order to give oral testimony, although it may only do so with the permission of the tribunal or agreement of the other parties and only if the witness is in the UK and proceedings are being conducted in England and Wales or Northern Ireland.

Expert Evidence:

In common law countries, parties generally submit expert evidence in a similar form to evidence from witnesses of fact, but most lawyers accept that the role of an expert witness is to provide objective and neutral evidence of a technical nature. Accordingly, the expert witness is expected to be independent of the parties[11]. Therefore, it is less common for counsel to assist in the preparation of expert witness reports to the same extent that counsel would assist in the preparation of written statements by witnesses of fact. If counsel were to do so, there would be a risk that the credibility of the so-called independent expert be seriously undermined. In international commercial arbitration, both practices are common. It may be the case that each party will choose to appoint its own independent expert. If the party-appointed independent experts are unable to provide the arbitral tribunal with sufficient assistance to enable it to resolve the relevant technical issues, or the tribunal prefers to appoint its own expert in any event, it will remain open to it to do so.

Based on the practice of common law and civil law systems, the IBA Rules permit the use of both party-appointed experts and tribunal-appointed experts. Under the Rules, party-appointed experts are assumed to be providing technical evidence in support of a party’s case. Tribunal-appointed experts are expected to report to the tribunal and assist the tribunal to determine the technical facts and issues. It is becoming more common in international commercial arbitration proceedings for tribunals to make orders that the party-appointed experts meet separately, before the hearing, to establish a set of agreed technical facts and issues. Occasionally a tribunal may require its own expert to attend such a meeting or, alternatively, report to the tribunal in respect of the outstanding technical issues.

Conclusion:

Procedures relating to the taking of evidence in international commercial arbitration continue to evolve through the application of the IBA Rules and the practice of experienced counsel and arbitrators. Experienced arbitrators tend to apply practical solutions to avoid inconsistent, inequitable or simply unhelpful practices in the taking of evidence in international commercial arbitration proceedings. The overriding objective, which should consistently apply to all international commercial arbitration proceedings, is to obtain the fair resolution of the parties’ disputes by a neutral and impartial tribunal.

Reference List

Books:

Civil procedure code

Evidence act

Webpage:

http://www.asil.org/erg/?page=arb [accessed: 27/11/11]

http://socialsciences.exeter.ac.uk/law/undergraduate/commonlawcountries/ [accessed: 25/11/11]

http://www.hse.gov.uk/enforce/enforcementguide/court/physical-written.htm

[Accessed: 24/11/11]

http://www.wisegeek.com/what-is-governing-law.htm [accessed: 25/11/11]

http://www.lawdit.co.uk/reading_room/room/view_article.asp?name=../articles/7130-the-meaning-od-disclosure-in-civil-litogation.htm [Accessed: 22/11/11]

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=981085&http://www.google.co.uk/url?sa=t&rct=j&q=middle%20ground%20approach%20iba%20rules&source=web&cd=5&sqi=2&ved=0CDoQFjAE&url=http%3A%2F%2Fpapers.ssrn.com%2Fsol3%2FDelivery.cfm%3Fabstractid%3D981085&ei=bK7dTrOmHIXgtQbHhJTyCA&usg=AFQjCNHRBCPG47HDBpSiuewnag2won58Tw&sig2=jtsfkxh7SP6pgrzZdreuPg [accessed: 30/11/11]

http://criminaldefense.homestead.com/cross.html [accessed: 29/11/11]

align=”left” size=”1″ />