THE ‘USUAL SUSPECTS’ PROBLEM IN ARBITRATION – AND HOW DIVERSITY CAN HELP SOLVE IT
Challenges to the impartiality of arbitrators are becoming more common. In most cases where an arbitrator’s impartiality is challenged, the issue is not one of actual bias, but whether there is apparent bias. The test for apparent bias is well-developed. In the UK’s context it has been stated as follows: “whether the fair-minded and informed observer, having considered the facts would conclude that there was a real possibility that the tribunal was biased.” While not framed in identical terms, similar tests are prescribed in arbitration rules around the world.
The arbitration context raises some issues that are distinct from those of the judicial context. In the discussion of bias, one of the most obvious differences is that arbitrators are typically nominated and compensated by the parties themselves. As such, the income of arbitrators is directly related to their selection by parties and their counsel.
The ability of the parties to select their decision maker is responsible for many well-known advantages of arbitration. However, it also lies at the heart of the growing discussion about how party-selection factors can give rise to apparent, or even actual, bias.
‘Affiliation’ and unconscious bias
We are more aware than ever of the unavoidable impacts of unconscious bias in all aspects of work and life. Arbitrators are not immune. Factors such as gender, race, national and ethnic background, occupational experience and nature of legal training have been identified as factors that can influence how disputes are viewed and decided.
Oct-Dec 2023 issue
McCarthy Tétrault LLP