The Arbitral Role in Contractual Interpretation

6(1) Journal of International Dispute Settlement (2015 Forthcoming)

Queen's University Legal Research Paper No. 2015-012

36 Pages Posted: 8 Dec 2014 Last revised: 1 May 2021

See all articles by Joshua Karton

Joshua Karton

Queen's University Faculty of Law; National Taiwan University - College of Law

Date Written: December 8, 2014

Abstract

This article considers the role of arbitrators in adjudicating the merits of international commercial disputes. It focuses, as a case study within this broader topic, on the interpretation of contracts. Interpreting contracts is a highly practical activity, but arbitrators’ approach to interpretation has important implications both for theory and for the success of arbitration as a means for the resolution of international commercial disputes. Are arbitrators more like judges, bound to apply the governing law according to strictly-defined rules, or more like commercially-minded problem-solvers? What approach best serves the needs of commercial parties?

The article challenges a widespread attitude that arbitrators should interpret contracts according to their commercially reasonable meaning, regardless of the interpretative rules provided in the governing law. First, it documents this attitude in the published awards and in the ‘extra-judicial’ pronouncements of arbitrators. Second, it confronts the various arguments that might be made in favour of arbitrators departing from the governing law. Finally, it sets out a suggested approach for determining the appropriate interpretive method in any given case.

This article was awarded the JIDS James Crawford Prize in International Dispute Settlement for best article of the year.

Keywords: international arbitration, commercial arbitration, contractual interpretation

Suggested Citation

Karton, Joshua, The Arbitral Role in Contractual Interpretation (December 8, 2014). 6(1) Journal of International Dispute Settlement (2015 Forthcoming), Queen's University Legal Research Paper No. 2015-012, Available at SSRN: https://ssrn.com/abstract=2535160

Joshua Karton (Contact Author)

Queen's University Faculty of Law ( email )

Macdonald Hall
128 Union St.
Kingston, Ontario K7L3N6
Canada

National Taiwan University - College of Law ( email )

No.1, Sec.4, Roosevelt Road
Taipei, 10617, 10617
Taiwan

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