I. The Memorial Elephant Trap

Memorials are often my preferred approach. They present a complete, coherent, cross-referenced submission with all the evidence attached, with obvious advantages over a “teaser” document to be followed some months later by witness testimony and possibly even later still by sight of the documents to be relied upon, the alleged significance of which may not be revealed until very close to the oral hearing. But the elephant trap with memorials is the risk that the urge to tell a story overtakes and replaces the need for careful legal analysis of the elements of the claim or defense.

Of course, not all cases require delving into a detailed analysis of the applicable law and your tribunal may already have detailed knowledge of the relevant principles and may have been chosen precisely because of that. However, there are a substantial number of cases the outcome of which will depend upon the tribunal's findings with regard to the applicable law and specifically on whether the requirements for the particular cause of action have been established. Cases may arise where there is a dispute between the parties as to the applicable legal principles and the claim will stand or fall on whether the tribunal accepts one party's reasoning or the other. It is those cases where the danger lies. Whilst some will argue that most cases turn on the facts not the law, I would suggest that is perhaps an oversimplification because ultimately your tribunal are always going to have to focus on the law as part of their decision making, even if it might not be the most contentious aspect of the case.

The focus of memorials is often on delivering a compelling, factual narrative designed to vindicate a party's position and condemn that of the other party. Emotive adjectives abound, with the approval of clients who may be desperate to convey their side of the story. Do not imagine that will necessarily win the hearts and minds of the tribunal and engender a sense of a moral duty to provide recourse, because arbitrators will look beyond this—that objectivity kicking in again.

A danger is that the attention given to getting the story across comes at the expense of rigorous legal analysis. Counsel getting so wrapped up in their narrative of wrongdoing that they fail properly to consider the requirements of the legal case they seek to advance. That can of course be fatal, because no matter how convincing the storyline or how sympathetic the tribunal might be, it must ultimately be provided with a legally coherent and persuasive route to its determination. An account of mistreatment, however compelling, is not enough to ensure there will be redress. Indeed, if the tribunal is left scratching their heads as to the legal basis of the case being advanced, because it is hidden in a morass of prejudicial ranting, your memorial is not achieving its purpose.

Examples of neglected legal analysis are perhaps necessarily quite specific but by way of illustration:

• • the fraud claim where the successful party affirms the contract but seeks damages on the basis of restoring the parties to the position they would have been in had the contract never been entered into;

• • the claim for expropriation where the asset remains operational and under the full use and control of the claimant;

• • the shareholder claiming on behalf of the company it owns against third parties for losses that the applicable law permits only the company to claim; and

• • the claim that jumps from wrongdoing to proof of loss without addressing causation or even perhaps without a proper articulation of the alleged breach.

What I have found striking about such cases is that they invariably involve a forceful and passionate factual narrative of alleged wrongdoing. One is left with a sense of counsel having become so preoccupied with presenting their factual narrative that the legal basis of the claim does not get the attention it deserves. Almost invariably, the legal analysis comes only at the back end of the memorial. But that does not detract from its importance—especially for your tribunal whose approach to decision making has to be focused on the legal framework and the elements necessary to support any award. Losing sight of such elements also invariably leads to wasting time on matters which are ultimately irrelevant.

This lack of rigor in legal analysis can often involve arguing for the application of a wide range of legal theories, regardless of whether they are truly sustainable on the facts of the case. Presumably the idea is to give the tribunal a range of alternatives to choose from. There is merit, however, in the saying “less is more” and an eclectic approach to pleading can not only detract from its effectiveness, but somehow give counsel a false sense of security that there must be a valid claim in there somewhere. This arises frequently in the context of commercial arbitration but I would also ask, rhetorically, how often are claims based on full protection and security and national treatment standards thrown into the mix in treaty claims when they really add nothing to the principal claims of FET and/or expropriation?

II. Addressing the Law

A related point concerns how we develop legal argument more generally in the course of an arbitration proceeding. This was the subject of my essay entitled “The Development of Legal Argument in Arbitration: Law as an Afterthought – Is it Time to Recalibrate Our Approach?” written in 2015 as a contribution to Practising Virtue: Inside International Arbitration (edited by David D. Caron, Stephan W. Schill, Abby Cohen Smutny, and Epaminontas E. Triantafilou), the publication celebrating Judge Brower's eightieth birthday.

Legal argument is now frequently delivered in the form of written submissions with little opportunity in practice for detailed oral exchanges with the tribunal. The use of legal expert witnesses has declined in favor of counsel arguing the relevant law by way of submission, often with the credibility of doing so enhanced by the addition to the counsel team of a lawyer qualified in the relevant jurisdiction. In the investment arbitration sphere, academic experts on public international law are also sometimes retained as part of the counsel team. Even if expert evidence on legal issues is adduced, cross examination on it seems in practice often to be dispensed with.

As a result, the development of legal argument at the oral hearing has waned. Hearings are increasingly focused instead on the examination of non-legal witnesses. Indeed, they are often tellingly described as evidentiary hearings. This is the nomenclature adopted in the hugely influential International Bar Association (IBA) Rules of Evidence, which focus on the presentation of documentary and especially witness evidence, with no specific mention in the rules of the presentation of legal argument. That is not a criticism, the IBA Rules are clear as to their focus on the taking of evidence, but it is instructive that arbitration has developed this widely adopted set of procedures for dealing with evidence, right down to the sequence of appearances of witnesses at hearings, but yet has no explicit mechanism or guidelines for dealing with the legal issues in the case and whether, or how, that is to be done; rather it has to be addressed on a case-by-case basis.

In some ways the focus on witness evidence is itself an intriguing development. Those who decry the relevance of legal argument on the basis that most cases turn on the facts, may well also recognize that witness evidence is notoriously unreliable and should arguably be given little weight. Nevertheless, despite the legal analysis being a key part of the tribunal's award, the battle for airtime at hearings seems largely to have been won by witness evidence.

As an arbitrator, and perhaps influenced by the view that the memorial system means the legal basis of claims is not always given the close attention it deserves, I believe that further attention is warranted to the question of how best to accommodate legal argument within the arbitration process, at least in those cases where it is likely to be a significant factor in the tribunal's decision making.

Memorial style submissions encourage legal argument being canvassed in writing, often with citations to a wealth of legal authorities. There is often no limit on the extent of the written argument, which may run to hundreds of pages and the sequential exchange of memorials can often mean that by the time the case reaches a hearing, the tribunal will have received the equivalent of a medium-sized novel. Indeed, this may explain the common approach to effective case management as being to treat that as sufficient without the need for legal argument at the oral hearing.

This means, however, that there is very little interaction with the tribunal regarding what it considers to be the relevant legal issues in the case, with the parties effectively being left to identify, explore, and analyze them. Counsel therefore determine which legal issues are to be canvassed and how they are to be addressed with very little, if any, feedback from the tribunal. Indeed, in practice it is relatively unusual for the tribunal to have much say in the matter until they get to the point of asking for certain issues to be addressed in post-hearing briefs, which again often just leads to more written submissions.

The parties may be relying in part on the tribunal's existing familiarity with the particular area of law. But can all arbitrators really be said to have sufficient knowledge or understanding of the law applicable to the case, even if it involves a jurisdiction other than that from which they came and perhaps even a different system of law? If not, is it sufficient that they receive detailed written submissions but often have little or no discussion or opportunity to question? Even if they are familiar with the applicable law, as one very senior retired judge recently put it to me, it is in the areas you think you know best where you are most likely to make a mistake!

Interestingly, the issue is perhaps less pressing in the context of a more traditional pleading style of arbitration proceedings. There the parties serve short formal pleadings setting out their respective cases, including the legal basis of the claim or defense, followed separately and subsequently by documents and witness evidence. The written articulation of legal argument is often in skeletal form, setting out the principles contended for but without detailed analysis. That comes later in the form of pre-hearing summaries, but perhaps because it has previously received more limited attention, it is not uncommon for more time to be set aside for legal submissions to be given orally at the hearing, either in lengthier opening statements or sometimes in oral closings, leading to a greater level of interaction on these matters with the tribunal.

Another aspect of this issue concerns how helpful the lengthy written legal submissions in the memorial are to the tribunal. They are often carefully crafted and may advance tightly worded propositions that ultimately turn out to be of little assistance, because they address a distorted version of the relevant principles—i.e., “straw man” arguments. Or they may be superficially persuasive but ultimately will not withstand detailed scrutiny. Or they may simply be filled with obfuscation. The reality is that an uninhibited scope for written argument can on occasions induce a lack of focus or a failure to apply intellectual rigor to the legal analysis. All the more so, when counsel knows they will never be called upon orally to defend the positions taken under sustained tribunal questioning.

For those who think this underestimates the intellectual firepower of most arbitrators, it is perhaps worth reflecting on the following. The arbitrator may have trained in a particular jurisdiction and most of their career may have focused on arguing cases based on that applicable law. They may be diligent about keeping up to date with significant legal developments. They may even have done a case or two within the last few years that involved the particular area of law with which they are now concerned. For all that, the arbitrator will still need to grapple with the specific legal concepts and principles applicable to this particular case.

So how does that typically play out?

• • The arbitrator will read counsel's submissions in preparation for the hearing;

• • If the case concerns an area of law that the arbitrator is familiar with, they will do so quite quickly, as they have hundreds more pages of submissions left to read; and

• • The arbitrator may focus on certain points that are thought to be in need of elaboration, not least to make sure they have understood the legal case being presented and the reasons why the parties dispute each other's legal analysis.

Next comes the oral hearing:

• • Opening submissions at which legal argument usually gets little, if any, attention;

• • Quite possibly no oral closings; and

• • Questions for the post-hearing briefs.

So even at the oral hearing, the rubber does not really hit the road. Indeed, there is a risk that really only happens when the arbitrators come to put pen to paper to write their award. It is at that stage they have to focus in detail on the legal issues in order to articulate their reasoning for deciding one way or another. At which point they will have to do so on the basis of the papers. The alternative, if they find something lacking, is to reopen particular matters for clarification or elaboration, which inevitably leads to delay and possibly even suggestions of a due process infringement because the tribunal is unfairly allowing one or other party a second bite of the apple in terms of making good their case. It is unsurprising, then, that tribunals are reluctant to go down this path.

A response to these remarks may be to suggest that tribunals should focus earlier in the piece so that they can ascertain if there are aspects of the respective legal cases about which they want more interactive debate or discussion. Surely, they have the powers to ensure that they can test the legal arguments presented and recalibrate the focus of the hearing if that is what they consider appropriate?

There is some force in this point and of course there have been efforts to introduce procedural devices to assist the tribunal in exploring more deeply the issues in the case at an earlier stage—the so-called Kaplan Openings and Reed Retreats for example. However, these have yet to become common or even widely accepted practices, and there seems to be little or no pressure from the parties for their adoption.

There is also a need for something of a reality check regarding the role of the arbitrator. The counsel teams on substantial cases will often be very large, and the tasks meted out in a way that enables detailed focus on particular aspects of the case by different subgroups, each of which will take responsibility for mastering their particular area of the case. Arbitrators do not have that luxury. Even if the tribunal has agreed in advance on which of them will take the lead on writing different sections of the award, it is incumbent on all to get across the entire case so that they can provide effective input into the deliberation process. Of course, absent a dissent, they are all equally responsible for the entirety of the award.

The tribunal therefore has to make its best efforts to master the entire case. As each memorial arrives, usually several months apart, the arbitrator will be building their knowledge and understanding of the case. They have to absorb what is often a vast amount of material. So, it is perhaps not altogether surprising that an issue with, or gap in the legal reasoning, may become apparent only when the tribunal seeks to marshal their notes and the materials presented in the form of a reasoned award. That is particularly so when the issue or gap is one which a party may have been specifically attempting throughout to gloss over.

There is no one-size-fits-all answer to these issues, but they do perhaps raise questions about the fact that arbitral procedures often take a familiar form without always fully recognizing the particular features of the case. There is perhaps benefit to be gained from a more targeted approach to identifying those cases where the law is a matter of real contention between the parties or where the case raises complex or novel legal issues with which the tribunal may not already be familiar. Careful consideration can then be given to when and how the legal analysis is to be developed and for this to be done on a more bespoke and indeed collaborative basis which engages the tribunal. As counsel, if it really matters for your case, maybe you should be pressing for more airtime at the hearing to discuss legal issues.

III. The Treatment of “Difficult” Issues – The Good, the Bad, and the Ugly

The final topic is the treatment of difficult issues, or what might be termed the good, the bad, and the ugly ways of handling the challenging issues that a case throws up.

Parties in almost every case have to deal with difficult points. If it was all straightforward, the case would likely have settled some way along the course and would never have come before the tribunal. They might be facts that are difficult to reconcile with the favored case theory, unhelpful documents or legal authorities that undermine the argument being advanced.

As arbitrators, your tribunal will understand this. They will know that each party is likely to have strong points and weak points to their respective cases. They also understand that counsel will want to focus on those aspects of the case where they are stronger and can confidently denigrate the other side's position. Good counsel also know that they have to deal with the weaker elements of their case too, and the aim will often be to persuade the tribunal that they are not really weak points at all or have been exaggerated or misunderstood by the other side.

It can sometimes be frustrating for counsel that when it comes to the oral hearing, or the questions posed by the tribunal to be answered in post-hearing briefs or oral closings, the tribunal often seem to show a disproportionate degree of interest in the more challenging aspects of the case. Those are the issues that seem to really interest the tribunal. That is of course not the tribunal being “mean,” it is because they genuinely want and need help in understanding how a party says they should deal with the more challenging aspects of the case when it comes to writing the award. The tribunal will likely have grasped many, even if not all, of your weak points from the written submissions, and the hearing is their opportunity to explore them with you.

Your arguments and explanations may have a significant impact on the outcome of the case, which means the stakes will often be high. So how should these difficult issues be tackled?

There are a variety of approaches and of course the best response will depend on what the specific point is, the degree of its relevance and so on. This is not the occasion for a micro-analysis of how to deal with difficult issues, but there are good response techniques, bad response techniques, and, yes, ugly responses.

So, what is the good response? It is the effective marginalization of the point to the tribunal's key decision making, or better still the explanation of why the tribunal should consider it entirely irrelevant. It is the highlighting of evidence and the development of argument to show that what may have seemed clear cut is actually more nuanced and has to be seen in a broader—or narrower—context. It is the demonstration of an alternative perspective.

All very case specific and easier said than done, of course.

Which is probably why one also encounters the bad way of dealing with the difficult points. Those challenging issues where the best answer contemplated is unconvincing for counsel, let alone the tribunal. In this situation counsel may try instead to ignore the issue or its implications for the case, often by attempting to divert the discussion back to areas where their case has a stronger foundation. Various devices are adopted, including dealing with a tribunal question by answering a different, less uncomfortable question. Or responding on a tangential point whilst avoiding the thrust of the point which underlies the difficult issue. The problem with this is that it is frustrating for your tribunal when counsel does not answer its questions. Perhaps more importantly, the tribunal may have to assume that counsel in fact has no coherent answer to give.

I would encourage counsel to think of tribunal questions as genuine attempts to understand how it is proposed that the award should address the trickier points. Taking time to reflect is perfectly acceptable, and often the questions can be responded to in writing, but I would suggest that you do not try to duck them unless you really, really do not have anything to say.

Which brings us to the third category, the ugly way of dealing with difficult issues. Put succinctly, this comes down to counsel seeking to hoodwink the tribunal. The most common method here is the misquotation or mischaracterization of the record, such as giving citations that are incomplete and omitting relevant text in a way that distorts the thrust of the passage relied upon. Or perhaps footnoting a source that does not in fact support the proposition or arguing that a point has been established by the evidence, when in fact it was the subject of tentative and unsupported conjecture by that party's own witness. Or possibly relying on a statement in a legal authority that in fact formed part of counsel's argument rather than the court or tribunal's determination. The list of “ugly” responses is extensive!

By definition, as an arbitrator you do not know how many of these devices you miss. However, arbitrators do check citations and references and follow through the assertions in submissions to the source material upon which they are based. My advice is not to be tempted to go down this “ugly” path, not least because there is little that an arbitrator finds more irritating than the sense that counsel is trying to dupe them.