Procedural Issues Resulting From a Fraud Claim in International Commercial Arbitration
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Allegations of fraud and corruption are increasingly encountered in international arbitrations but there is at times a perception that international arbitration, which is by nature a private and consensual dispute resolution mechanism, is ill-equipped to handle the challenges thrown up by such allegations. This is particularly so when looking at arbitral procedure. Is this perception justified or is international arbitration flexible enough a tool to overcome these challenges?
Is a dispute concerning fraud arbitrable?
In England there is no public policy requiring issues of fraud to be decided by the courts. Therefore, accusations of fraud are in principle capable of falling within the scope of an agreement to arbitrate. Whether they do so depends on the wording of the relevant arbitration agreement. At the outset of any contractual relationship, a party would not usually be anticipating fraud from its counter-party and hence, it is unlikely to expressly include language covering fraud in the arbitration agreement. However, the broad construction of arbitration clauses under English law may assist.
Read original articleTags: arbitration agreement, International Arbitration
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