The Role Of The Judiciary In Developing The Arbitration System

Abstract

Arbitration has witnessed significant development in recent years, and the judiciary has played an active role in its advancement through innovative interpretations, flexible reasoning, and the recognition of principles that helped fill gaps faced by arbitration bodies.

The role of the judiciary has been evident in defining the scope of arbitration agreements. Judicial precedents have allowed the extension of the effects of arbitration agreements to non-signatories in specific circumstances. The judiciary has embraced interpretations that permit arbitration to operate outside of specific domestic laws, expanding the realm of commercial arbitration beyond the confines established by national legislation. It has adopted a broad understanding of commercial activity to include actions that may not be considered commercial under national laws.

Notable contributions by the judiciary include laying the groundwork for the principle of the independence of the arbitration clause and the doctrine of kompetenz-kompetenz (the competence of the tribunal to determine its own jurisdiction). These developments were responses to practical justifications aimed at preventing the nullification or collapse of the arbitration process when the agreement containing the arbitration clause is deemed invalid.

The doctrine of kompetenz-kompetenz has also helped prevent delay tactics and achieve expeditious resolution. This has been reinforced by the adoption of the Estoppel Rule, which gives power to waste the objector's defenses if a blatant contradiction is found in their position: participating seriously in the arbitration proceedings for a long time and then invoking the invalidity of the arbitration agreement