Robert Briner, L. Yves Fortier, Klaus Peter Berger & Jens Bredow
Carl Heymanns Verlag KG
Judicial review of arbitral awards constitutes a form of risk management. In most countries courts may vacate decisions of perverse arbitrators who have ignored basic procedural fairness, as well as those of alleged arbitrators who have attempted to resolve matters never properly submitted to their jurisdiction. In some countries judges may also correct legal error or monitor an award's consistency with public policy.
Public scrutiny of arbitration is inevitable at the time of award recognition. Judges can hardly ignore the basic fairness of an arbitral proceeding when asked to give an award res judicata effect by seizing assets or staying a court action.
Less evident is why the arbitral situs should necessarily monitor an award prior to an enforcement action. When the controversy is international, an arbitral situs is often chosen only for geographical convenience or procedural neutrality.4 If a dispute involves neither property nor activity at the place of arbitration, that country might arguably dispense with allocation of judicial resources toward review of the arbitrator's decision. At least one scholar suggests complete elimination of pre-enforcement judicial review.
The thesis of this modest note in honor of Professor Boeckstiegel is that judicial review of awards at the place of arbitration usually does make sense in international arbitration. Court scrutiny of an arbitration's integrity promotes a more efficient arbitral process by enhancing fidelity of the parties' shared pre-contract expectations. In some instances review also furthers the development of commercial norms to guide business managers in planning future transactions.
Why Courts Review Arbitral Awards
Recht der Internationalen Wirtschaft und Streiterledigung im 21. Jahrhundert: Liber Amicorum Karl-Heinz Boeckstiegel
(Robert Briner, L. Yves Fortier, Klaus Peter Berger & Jens Bredow ed.,
Available at: https://scholarship.law.bu.edu/faculty_scholarship/2213