After First Options: Delegation Run Amok – Vol. 32, No. 1

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Author: George A. Bermann*

Published: September 2021

United States
Agreement to Arbitrate
Contents of Arbitration Agreement
Jurisdiction and Powers of the Courts in Matters of Arbitration Generally
Arbitration Clauses
Contractual or Consensual Basis of Arbitration

The proper allocation of authority between courts and arbitral tribunals over the enforceability of agreements to arbitrate has long occupied a central place in U.S. arbitration law, domestic and international alike. From U.S. Supreme Court case law over the years, there has emerged a reasonably well-understood distinction between those issues of enforceability that a court will address if asked by a party to do so and those that it will not. Fundamental to the Court’s jurisprudence is a recognition that some enforceability issues—“gateway issues”—so seriously implicate the consent of parties to arbitrate their disputes that a party contesting the enforceability of an arbitration agreement on those grounds is entitled to a judicial determination of the matter, while others—“non-gateway issues”—do not. The Supreme Court has adopted the convention of also referring to gateway issues as issues of “arbitrability,” even though that is not how the term arbitrability is understood throughout most of the world.

Classic gateway issues include whether an agreement to arbitrate was ever validly formed, whether a non-signatory is bound by it, and whether it encompasses the dispute at hand. What these issues all have in common is the perception that they directly implicate the consent of the parties to submit a dispute to an arbitral rather than a judicial forum. By contrast, classic non-gateway issues include the timeliness of requests to compel arbitration of a dispute and the satisfaction, or not, of conditions precedent to arbitration. These issues do not question the consent of the parties to arbitrate, but whether an obligation to arbitrate a particular claim should be enforced. Parties are free to raise their arbitrability objections for the first time before an arbitral tribunal itself for decision, but U.S. law also allows parties to raise them for the first time before a court if they so prefer.

Includes a Postscript about the Second Circuit’s recent decision in Beijing Shougang Mining Investment Co., Ltd. v. Mongolia. Read a  summary of it here.

Download the full article here.

* George A. Bermann, Professor of Law, at Columbia Law School, is a highly experienced international arbitrator in both commercial and investment arbitration. He has conducted arbitration regularly since 1980 before all the leading international arbitral institutions. He is Chief Reporter of the American Law Institute’s “Restatement of the U.S. Law of International Commercial and Investment Arbitration” and co-author (with Emmanuel Gaillard) of the UNCITRAL Guide to the New York Convention.

Professor Bermann is Co-Editor-in-Chief (with Rob Smit) of the American Review of International Arbitration (ARIA).