The role of the judiciary in the international Commercial Courts — a view from LIDW 2023

The role of the judiciary in the international Commercial Courts — a view from LIDW 2023

The panel led by The Honourable James Allsop AC, the Chief Justice of the Federal Courts of Australia, provided a fascinating insight into the work of the SIFoCC and the current challenges under consideration by the forum. With a membership of 46 Commercial Courts from around the globe, the forum provides an international platform which not only considers the challenges faced by these courts, together with potential solutions, but also works to develop best practice across the jurisdictions, for example through its observation programme which enables Commercial judges to observe the workings of a commercial court in a different jurisdiction to their own. For an insight into the function of the forum, see: .

 

The current work of the SIFoCC can be broken down into three broad topics being:

  • Managing the complexities of modern dispute resolution—the reasons for complexities in dispute resolution are numerous but include the advances in technology as well as the different mechanisms available to parties to address different aspects of the case
  • The future of corporate legal responsibility—with a specific emphasis on climate change
  • The transnational character of dispute resolution—the conflict between the approaches in different jurisdictions

In discussing these, the panel provided a wide-range of insights from different jurisdictions including the UK, the EU and off-shore jurisdictions. 

 

Complexity of disputes

Complexity was recognised as a very clear and common concern between the different jurisdictions, whether they be common law or civil law based. While they encounter similar issues, differing approaches on how to tackle them are taken. Insights from France (civil law) showed a very different approach to litigation to that in England and Wales (common law).  In common with other civil law jurisdictions, there is no obligation to give disclosure and the mechanisms for disclosure within the proceedings are very limited. Other differences identified included the fact that any documents a party wishes to rely upon must be provided at the onset of the proceedings and there is a lack of oral proceedings. The differences highlighted by the panel all considerably simplify the complexity of determining a dispute. In England and Wales, the phase of disclosure and the use oral hearings add layers of complexity to the litigation process but the current emphasis is on digital justice thus enabling a single data set to be easily interrogated at any time. In dealing with complex disputes, in Australia, a judge may obtain assistance from the parties’ own technical expert witnesses without reference to the parties. But is this a step too far?

 

Technological developments

A key issue for courts around the world is the rapid development of and growing use of technology and, in particular AI.  As noted by the panel, this is very clearly a global issue as the use of technology, such as block chain, transverses jurisdictional borders. Does this mean that there should be an international approach?  Currently, the EU have a proposal for an AI regulation, while the SIFoCC are actively considering how to address issues arising from AI.

A question posed to the panel was whether AI is a problem or could be part of the complexity solution?  Views can be polarised in this space, but there was considerable support from some members of the panel for the proposition that it can be part of the solution.  However, this would only work if it was used to both support the judicial system and to guarantee and promote the rule of law. While the remarks of one panel member, that we need to consider what legal decisions can be made by AI, may be a step too far for many in the legal profession today, the fact that the pace of change is so rapid means that such discussions are very likely to become commonplace.

 

Corporate governance

The focus here was on climate change.  While previously this was the preserve of public law, there has been a shift in focus to the potential responsibilities and duties of businesses. A key question is how judiciary in different jurisdictions will approach such disputes given that they are bound by the laws applicable in their own jurisdiction or as agreed by the parties. In England and Wales, the duty of care owed by directors to the company and its shareholders now requires regard to be given to ESG and the Commercial Court has seen a rapid rise in the number of derivative claims, many of which are ESG related. In the Netherlands, the Hague court gave the first climate change ruling against a company in 2021 when it ordered Shell to reduce its omissions by a set percentage within a stated time frame. What impact should such cases have on the courts in other jurisdictions, given that, after all, climate change is itself a global concern? This is a space to watch but it is critical that platforms such as SIFoCC exist to enable the exchange of information between the countries especially where in many cases such claims are bought on the basis of a breach of duty rather than under any specific legislation. Interestingly, where the focus for such claims is with parent companies, there is the possibility or, perhaps probability, that there will be an increase in such litigation in offshore jurisdictions in which many parent companies are registered.

 

Conclusion

The importance and significance of institutions addressing the difficult issues that arise in cross-border disputes cannot be underestimated. Whether it is a permanent and progressive institution which covers a wide variety of different types of disputes, such as the SIFoCC, or more focussed projects, such as INSOL dealing specifically with insolvency disputes, the judiciary, the legal community and ultimately the parties to disputes are better served by the co-operation and sharing of information and understanding that these institutions provide.

The aim of the SIFFoCC was summed up at the end of the panel discussion as providing a platform for the legal profession to engender a problem-solving culture. There is very clearly a need for co-operation. While many jurisdictions still have an adversarial approach, the complexities of the dispute resolution arena require clear co-operation at all levels. It cannot be left to bodies such as the SIFoCC; everyone has a role to play and there is the potential for legal teams to make a big difference by effectively and creatively using the many tools available to them within the dispute resolution arena.

I leave you with this anecdote from the panel. Last week, in Japan, a student moot was staged using Chat GPT as the judge! Could this be an insight into the future? My friend, a judge, certainly hopes not.

 


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About the author:

Janna is a dispute resolution lawyer. SheÌýdeals primarily with cross border issues and is active in the work being undertaken in relation to the implications of Brexit for Dispute Resolution lawyers. Janna also heads up a ÀÏ˾»úÎçÒ¹¸£Àû costs team bringing together expertise from across the company to deal with the costs issues facing the profession.

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