Tuesday, 4 December 2018

Critically compare the doctrines of competence-competence adopted by American and French courts. Which is superior?


The principle of competence competence in arbitration law is the principle that arbitrators have power to rule on their own jurisdiction. It has a positive and a negative aspect; the positive aspect to the principle is that an arbitrator can proceed with an arbitration and rule on its own jurisdiction even if the validity of the arbitration agreement is challenged in court. The negative aspect is that the courts should not make a judgement regarding the arbitrators’ jurisdiction until the arbitrators have had the opportunity to do so.
I will take the question of ‘which doctrine of competence competence is stronger?’ to mean ‘under which legal system does the arbitrator have the most power to rule on its own jurisdiction?’.

USA:
The doctrine of competence-competence is not mentioned in the US Federal Arbitration Act. It is a doctrine developed by the judiciary, and is intrinsically linked to the doctrine of separability, which is also a construct of the judiciary.
The doctrine of separability in the arbitration context holds that an arbitration clause in a contract is a distinct entity from the rest of the contract. The case of Rent-A-Center, West, Inc. v. Jackson used this concept to shape the current doctrine of competence competence in the USA. In this case, Jackson argued that an arbitrator could not logically be empowered to review its jurisdiction by the very agreement that was being contested. It was held that the arbitration or ‘delegation’ clause was separate to the rest of the contract, and a clause which empowered the arbitrator to determine its own authority would remain valid unless it was this clause and not rest of the agreement which was challenged as being invalid. This case was a strong affirmation of the positive aspect to the principle of competence competence.

France:
In France, Article 1448 of the Civil Procedure Code was introduced by decree in 2011 and this article affirmed the existence of a principle of competence competence with both a positive and negative aspect. It held that an arbitrator has priority over a judge to determine his own jurisdiction, with the judge being unable to do this unless the arbitration agreement is manifestly void or the arbitral tribunal is not yet in existence. The parties are not able to alter this position by agreement; it is a compulsory rule of law. Article 1465 confirms this position by stating that “The arbitral tribunal has exclusive jurisdiction to rule on objections to its jurisdiction”.

Which doctrine is superior?
The French doctrine is superior as it has a positive and negative aspect, a dual effect, which clearly gives the arbitrator more power to determine its jurisdiction than the courts, whereas the US doctrine does not give the arbitrators as much power as this to determine its own jurisdiction.