ADVICE FOR GENERAL COUNSEL ON ARBITRATION VS. LITIGATION
CD: In your experience, are general counsels gaining a better understanding of their options when considering whether to pursue arbitration or litigation – or is greater awareness needed?
Kamstra: In my experience, many of the UK’s largest domestic FTSE companies only engage in a major arbitration that goes through to trial once every five or 10 years – some never – and the bank of knowledge based on repeat experience is just not there. One wise general counsel in my knowledge recently sent a senior in-house team member to sit the Chartered Institute exams, presumably to address that lack of technical resource in house, which is a very good idea. When I compare it to the average general awareness of the realities of arbitration on the part of corporate and commercial lawyers who draft arbitration clauses regularly and insert them in their agreements, it is clear that the need to gain a better understanding is there, but I am not sure it is actually happening.
Rowell: General counsel’s understanding has improved significantly in the past few years. Though the degree of understanding still varies, this is, however, predominantly a function of the experience of the process. In other words, in certain sectors where disputes are more common, general counsels often have more experience of navigating through arbitration. The legal profession has also gone to great lengths to provide training on the differences between arbitration and litigation. We are starting to see a lot more involvement from general counsel in the case management process, including in the selection of their party appointed arbitrator and expert witnesses.
Jul-Sep 2016 issue
Norton Rose Fulbright LLP
Skadden, Arps, Slate, Meagher & Flom LLP