International commercial arbitration. The mexican case

AutorCarlos Rodríguez González-Valadez
Páginas44-57

Page 44

Jus respicit aequitatem1

1. Introduction

International Commercial Arbitration* is a highly advisable way of resolving disputes. Nevertheless, it has been used less often than litigation, since lawyers from certain countries do not have sufficient knowledge about this topic. Particularly, Mexico has this transcendental problem, which has to be taken into account to have good results in the world-wide commercial opening. The aforementioned knowledge must be considered from a legislative point to a practical one.

The legislative point includes mainly two parts: (i) a modern arbitral legislation, as is the case where the Model Law drafted by the UNCITRAL has been adopted, and; (ii) those international agreements that are essential for this topic.

On the other hand, the practical point is the decision about where and how arbitrations must be held, always depending on the circumstances of the particular case.

This article tries to analyse the pertinent Mexican legislation in order to function as a guide for a Mexican Lawyer who is not used to international arbitrations and wants to be competitive in respect of other lawyers around the world.

2.1. Why to use arbitration in international commercial disputes

Compromissarii sunt judices 2

Where a commercial dispute arises between two international dealers, we have different ways of achieving a settlement of that international dispute.

Amongst them, we firstly find negotiation, which is the simplest and usually the quickest form and the most advisable from our point of view. Nevertheless, the limitation in negotiating is that the parties should be in the best position to know the strengths and weaknesses of their respective cases, and we have to realise that this is occasionally impossible. Although negotiation is mainly a way of settling disputes where the parties have direct intervention, they must be advised in some points of difficulty or controversy by lawyers, accountants, engineers or other experts, as required. Unfortunately, on somePage 45occasions, parties agree to settle their disputes by negotiating, once they have already used other ways, such as litigation, and this means that money was unnecessarily spent 3 .

The second way of achieving a settlement of an international dispute is mediation. The difference between mediation and negotiation is that in the former there exists the intervention of a disinterested third person, this does not apply in the latter case. The third party is generally an expert technician on a specific issue, and it could be only one person or a group of them. This way of resolving the dispute is highly advisable, since the intervention of a third party is conducive to more objective, and ultimately more just, dispute resolutions. Nevertheless, as the decision of the mediator is only an opinion, and hence non-binding, sometimes it is not followed by the party who breached the contract in the mediator’s opinion 4 .

The third and the most common way is international commercial litigation. In this case the proceeding is held according to the applicable rules, which means the law of the forum. Where parties do not expressly agree the substantive rules, it is often quite difficult to determine the applicable ones. Even though this way of resolving disputes could be very positive and useful, we have to realise that there many factors that can transform it into an unfair one 5 .

Finally, we have international commercial arbitration, where a Tribunal decides a dispute arisen between two merchants. We consider that the importance of this method of resolving disputes is that it comes from the agreement of the parties, that means that the self-autonomy principle of the willing parties has its most representative expression in this agreement.

One of the purposes of this article is to show why a Mexican lawyer should choose international commercial arbitration over and above other methods to resolve a dispute in which his client is a party. To do this, an a priori analysis of the case is highly recommended in order to determine whether negotiation is a viable option. In case this is not possible, one must choose between the remaining alternatives; international commercial litigation and international commercial arbitration. We do not take mediation into consideration, since it is more effective in the field of public law than in commercial law.

At this time, we will outline the reasoning as to why a Mexican lawyer should choose international commercial arbitration instead of international commercial litigation. We part from the premise that the former is a better option than litigation.

Page 46

The comparative advantages and disadvantages of arbitration as opposed to litigation have been well rehearsed 6 . Some of the following are of particular importance:

  1. In case a dispute arises between a Mexican dealer and, for example, an English dealer, and if they choose international commercial litigation as the method to resolve the dispute, the Mexican enterprise will probably want to choose a Mexican Court to hold the proceeding, and the English company will naturally opt for an English Court. In this scenario, the place where the dispute is to be resolved will have striking repercussions upon the final outcome. The Mexican company, given the case that the dispute is to be resolved in Mexico, which will be determined by an agreement or by laws of conflict which establish jurisdiction 7 , will have language, expertise and system advantages over the English company. The opposite will occur if the case is resolved in England.

    The situation above is inherently unfair, since the alien company is at an automatic disadvantage. In the case of Mexico, we have to recognise that Mexican lawyers are not used to participating in proceedings held in England, that they do not know English law and consequently, that they will have to be assisted by English lawyers, which becomes very expensive for the Mexican dealer.

    In both cases, regardless of whether the dispute will be resolved in Mexico or in England, we could find political factors that might influence the judgement, being harmful for one party. Unfortunately, there is not yet an international court in which these kind of disputes can be resolved 8 .

  2. By using arbitration, dealers will find the benefit of deciding: (i) the members of the Tribunal; (ii) the rules under which the arbitration proceeding will be administrated; (iii) the place of the arbitration; (iv) the applicable substantial law, and; (v) the lawyers who will advise each party.

    In relation to the faculty of choosing the members of the Tribunal, we could mention that this advantage has to be seen against the fact of choosing judges, which is not possible. Firstly, arbitrators may be chosen for their special skills and experience in commercial law or some other relevant discipline. This experience and preparation saves money and time to the parties, as well as offering a sensible award. In the case of Mexico, at least, arbitrators are generally more capable than judges to interpret the will expressed in Page 47 the Contract, as well as to qualify and to evaluate the breach of the contract from which the dispute arose. Moreover, arbitrators have less cases than judges, which means that they are going to have more time to invest while studying each case and thus have a closer relation with the parties. Besides, in Mexico, judges are used to analysing cases under national law and hence are not used to studying foreign legislation 9 , and as we know in international sales the applicable law is often different from the one of the judge’s nation. Arbitrators will tend to be more able in applying foreign and international law to the case.

    Related to the applicable rules, including both, the substantive and the adjective law, the following can be said:

    (i) In substantive law, the parties are able to choose the rules that best fit the particular case, in some cases this will be the law of one of the parties in the dispute, whilst in others, the law of a third country will be applied 10 . It is necessary to mention that there are international agreements such as the United Nations Convention on Contracts for the International Sale of Goods, that can be applied to these transactions 11 .

    (ii) In adjective rules, we can mention that arbitration is more fl exible and adaptable and consequently quicker and more efficient than litigation. The court’s rules must be capable of dealing with many different kinds of cases, and hence might be unsuitable for some commercial trials. In arbitration, however, it is possible to tailor the rules to fit the particular case.

    There are proceeding rules such as the ones of the LCIA and the ICC that are highly recommended. Obviously, arbitrators and lawyers must know both the pertinent substantive and adjective rules in depth, since it is they who have been selected to act as experts on such a law.

    Related to the place of the arbitration, it can be said, that it is an advantage since it shows a neutral point. To decide the place of the arbitration, parties must take into consideration the geographical situation, the physical space and availability of services, the value of the business, and, from the legal and political perspective, the following has to be considered: (i) that the arbitral legislation of the chosen place is modern enough and adaptable for the law chosen by the parties; (ii) that such a country has adopted the United Nations Convention of Recognition and Enforcement of Foreign Awards; (iii) to choose preferably a place where the...

Para continuar leyendo

Solicita tu prueba

VLEX utiliza cookies de inicio de sesión para aportarte una mejor experiencia de navegación. Si haces click en 'Aceptar' o continúas navegando por esta web consideramos que aceptas nuestra política de cookies. ACEPTAR