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posted 3 years ago
The iura novit curia principle, or “the court knows the law”, was first mentioned (though not in the same wording) in Roman law. Even though Roman law traditions have been of great influence on the development of civil law systems, the theory that the judge should be the master of law only started to be widely considered in the 19th century.
Until the 19th century, the great majority of legal professionals, even in countries thought today to have a civil law tradition, considered the main purpose of civil proceedings to be dispute resolution and not establishing the rights and duties of the parties in the specific circumstances of the case. In other words, the court had no duty to ascertain the truth.
Even though France is known for its inquisitorial civil proceedings, the 1806 Code of civil procedure’s provisions had a strong adversarial nature. Based on the idea that civil proceedings should be cost effective and resolved in due time, the judge used to have a passive role without extensive powers regarding evidence and the establishment of facts, being more or less reduced to decide between the arguments of the parties. It was the Austrian Civil Procedure Code that, for the first time in Europe, introduced the inquisitorial model, a form similar to what we know today, by granting the court extensive powers regarding the determination of the applicable legal rules and fact finding. Having the Austrian model as reference, more and more European jurisdictions observed the benefits of a civil procedure system where the judge has a more important role in managing the case, and so they divided power between the judge and the parties in order to achieve the fairest solution to the dispute[1].
An example of a common law jurisdiction, England has never known the civil law system. Guided by the idea that the civil proceedings should consist of a single session, and the judge should decide about the case only as the trial moves forward, the English civil procedure was, for a very long time, a purely adversarial one.
Before the 1981 County Court Rules, the judge had little or no power (and duty) in ascertaining the truth, being bound to decide on the facts and the legal rules that were presented to him by the parties. Later, the idea that the civil proceedings should not only have a dispute resolution role, but also a duty in ascertaining the truth, has stirred up many debates. The arguments of the pro-adversarial side were that it is an efficient, cost-effective dispute resolution system, and that the parties are ensured justice is done given that the judge has heard their opinions; meanwhile, the critics were saying that the courts provide not only a service to the parties involved, but to society as a whole, and for that reason they should have a responsibility in ascertaining the truth.
The idea that civil proceedings should not be only a single session with the judge being bound to decide about the case only as it moves forward gained more and more supporters, and as a consequence, the 1981 County Court Rules enhanced the judge’s power regarding discovery. Order 14 of the 1981 County Court Rules stated that the court may, at any stage of the proceedings in an action or matter, order any party to produce to the court any document in his possession, custody or power relating to any matter in question in the proceedings, and the court may deal with the document when produced in such a matter as it deems fit. We observe that this rule had inquisitorial influences, even though is milder than, for example, Article 10 of the French Civil Procedure Code, which grants the judge the power to order ex officio any legally appropriate investigation measures.
We observe that, historically, the adversarial system was the most popular, but as society evolved, questions were raised about what civil litigation is intended to achieve – dispute settlement or judicial truth – which had as a consequence legislation that gave the court power, and in some jurisdictions, duty to ascertain the truth.
Representative for the civil law system, the current French Code de Procedure Civile is the perfect example of the application of the iura novit curia principle in modern civil procedure. To understand the way iura novit curia influences French civil proceedings, one must understand the structure of the French civil trial. Article 4 of the Code recognises a basic concept called the objet du litige, or the subject matter of the dispute, which is to be determined by the respective claims of the parties. The originating process and the defence submissions define such claims[2]. The objet du litige is unalterable by the judge, who must rule upon all what is claimed and only what is claimed[3].
The iura novit curia principle has its legal basis in Article 12 of the Code, which states that the judge settles the dispute in accordance with the rules applicable thereto. He must give or restore their proper legal definitions to the disputed facts and deeds, notwithstanding the denominations given by the parties. However, he may not change the denomination or the legal ground where the parties, pursuant to an express agreement and in exercise of rights that they may freely dispose, have bound him by legal definitions and legal arguments to which they intend to restrict the debate. Moreover, the judge may invite the parties to furnish explanations on the legal arguments that he deems necessary for the resolution of the dispute.
Even though the court has the power and the duty to resolve the case by the rules of law considered by him to be applicable, he may not found his decision on facts that have not been debated by the parties. The principe de la contradiction has its base in the provision of Article 16 of the Code, according to which the judge must supervise and respect the adversarial principle, which means that in his decision, he may take into consideration grounds, explanations and documents relied upon or produced by the parties only if they had an opportunity to discuss them in an adversarial manner. Per a contrario, he shall not base his decision on legal arguments that he has raised ex officio without having first invited the parties to comment thereon. In order to ensure the applicability of the principe de la contradiction, parties must disclose in due time to one another factual arguments supporting their claims, the means of evidence they produce and the legal arguments they rely upon so that each party may organise his defence and parties may not be judged without having been heard or legally called. Moreover, where the law allows or the circumstances require that a measure must be ordered without informing a party, the latter has a right to bring a review action against the decision condemning him.
The duty of the judge to ascertain the truth by applying the rules of law he considers applicable and ordering any evidence he considers necessary must be interpreted in accordance with Article 6 provisions, which state that the parties must put forward the relevant facts supporting their claims. The judge has the possibility to order evidence in order to form his opinion, but if the parties are passive, he is not bound in any way to actively intervene by substituting himself in the role of the parties[4]. With respect to the duty to decide the law applicable, irrespective of what the parties have invoked, the judge has to interpret the law and apply it in accordance with the status quo of the society. As no legislator can foresee all the hypotheses in which a legal norm applies, the court has the role to interpret the law in accordance with the current realities of the society.
England, traditionally a common law system, has seen changes in recent years with regard to its procedural law[5]. Changes that move English civil procedure closer to a civil law system include the following:
(a) Repeal of the against hearsay evidence, which has as principal effect the use of documents whose disclosure does not have to await the commencement of the trial. Therefore, the judge is informed when the hearings begin.
(b) Extended the use of expert written reports and introduced the exchange of written witness statements.
(c) Case management provision, which obliged the judge to read the documents available before trial, as the CPR underline the necessity of a well-informed judge before the commencement of the action.
(d) The judge has the possibility to give summary judgement against a claimant or a defendant if, not only on application but also ex officio, he appreciates that the claim or the defence has no real prospect of success[6]. Moreover, the judge has the power to control evidence by giving directions, as he may now give directions on the issues on which he requires evidence, on the nature of the evidence that he requires to determine those issues, and on the way the evidence is to be placed before the court[7]..
Having complex contractual relationships between parties engaged in commercial contracts concluded all over the world implies having possible disputes concerning the parties’ rights and obligations and, therefore, having the need to settle these disputes in a final and effective manner. One of the mechanisms for solving commercial disputes with an international character is arbitration.
The popularity of arbitration as the preferred means of resolving international commercial disputes may be attributed to the belief that international arbitration provides a neutral, speedy and expert dispute resolution process, which is largely subject to the parties’ control and leads to an internationally enforceable decision[8].
In addition, distinct from national courts’ decisions, arbitral awards are portable by virtue of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958 (hereinafter “the New York Convention”), which allows parties to engage in international trade knowing that if a dispute arises, they would not have to potentially undergo court procedures in order to claim their rights in the other party’s national courts to get a final resolution thereof[9].
Should the iura novit curia principle apply in international commercial arbitration? To answer this question, we first need to analyse the paramount characteristics of international commercial arbitration.
A basic principle in international arbitration, party autonomy gives the parties the possibility to construct a dispute resolution system of their choice to be best suited to their needs. Model Law Article 19 states that the parties are free to agree to the procedure to be followed by the arbitral tribunal in conducting the proceedings. Only if the parties fail to agree otherwise, the arbitral tribunal may, subject to the provisions of this Law, conduct the arbitration in such manner as it considers appropriate. The power conferred upon the arbitral tribunal includes the power to determine the admissibility, relevance, materiality and weight of any evidence. Similarly, the Arbitration Act 1996 gives the parties the possibility to agree how their disputes are resolved, subject only to such safeguards as are necessary in the public interest. Even if the parties select institutional arbitration, choosing to submit their dispute, for example to ICC, they have almost the same autonomy.
The principle of party autonomy usually refers to the procedure to be followed, and it extends also to the taking of evidence, the admissibility of evidentiary means and the probative value the tribunal attaches to them[10], but one could say this should also apply in choosing the legal rules applicable to the matter of the dispute.
There are critics arguing that an informed arbitrator, who is allowed or has the duty to make his own research in order to apply the appropriate legal rule to the facts, without being bound to the rules invoked or the qualifications of the facts the parties have proposed, is prone to accidentally form his opinion before the hearings.
I find this judgement to be wrong, as I believe that an uninformed arbitrator is much easier to be misled by a skillful lawyer. A passive judge would be more inclined to fall for the argument that is expressed more convincingly to the detriment of the truth.
Often, time efficiency of the arbitral proceedings is the reason that parties agree to submit their dispute to arbitration. It is one of the most important differences between arbitration and court litigation. In this respect, it is well known that adversarial systems are more time consuming, and, as a consequence, they involve more costs than inquisitorial systems. One of the reasons is that the element of surprise, which is inherent to adversarial procedures, creates confusion, and often the court is found in the position to postpone the hearing. According to the 1999 IBA Rules on evidence, as a general rule, written presentations are extensive and are the principal means of introducing evidence. Moreover, disclosure of evidence takes place only under order of the arbitration tribunal[11]. Consequently, after the 1999 IBA Rules on evidence were introduced, the efficiency debate between adversarial and inquisitorial systems regarding arbitration is more of a theoretical one, since the Rules provide mechanisms for presentations of documents, witnesses of fact, expert witnesses and inspections, as well as for the conduct of evidentiary hearings.
Taking into consideration that stated above, we should decide if the arbitrator should have any duty in finding the truth. Is arbitration just a dispute resolution mechanism, or does it have a larger role to serve the society as whole? As professor J.A. Jolowicz stated[12], “if the role of arbitration is to decide what are the legal rights and obligations of the parties in the circumstances that have arisen, then, as a general rule and to the extent that human frailty allows, the decision should be based on the dictates of the law as a whole, not merely upon those of that particular part of the law or rule of law that the parties or their legal advisors may have invoked. Translated into practical terms, this means that the ultimate choice of applicable legal rule should be for the court, not the parties: da mihi factum dabo tibi ius or iura novit curia”. However, this principle, even though desirable, very often cannot be applied in international arbitration, given the fact that many times the arbitral tribunal it is not formed from professionals in the substantive law applicable in the cause.
In order to observe that in international commercial arbitration, ascertaining the applicable law by the arbitral tribunal would be, in most cases, a very difficult job if not an impossible one, I will quote a funny but very common story:
“I remember an arbitration in which Algerian substantive law governed. The dispute turned on the interpretation and adaptation of the price indexation clause in a long-term gas supply contract. The parties had filed some legal authorities, statutory provisions and commentaries about contract interpretation. That was all, and it was sufficient because the resolution hinged on facts and contract interpretation. Until we reached the claim for late interest, specifically compound interest. Could it be allowed under Algerian law? Would it be regarded as a violation of public policy at the lime of enforcement, which may have to be sought in Algeria? The tribunal had no input from the parties. Following my civil law instincts, I started researching Algerian contract law and then encountered two difficulties. First, I did not really know whether I was supposed or expected to do so (in any event, I would have asked the parties’ comments on the results of my research). Second and foremost, the relevant materials were in Arabic, to which I had no access without hiring a translator, which I would not have done without consulting the parties. To make a long story short, I gave up and asked the parties for brief legal submissions limited to compound interest under Algerian law.”
We can easily observe that, as opposed to the national judges from civil law jurisdiction, arbitrators come from different backgrounds – it is not that uncommon to have an arbitral tribunal constituted from three arbitrators from three different countries – and many times, the law applicable to the substance of the dispute constitutes foreign law for all of them.
Many authors state that Rule 44.1[13] of the Federal Rules of Civil Procedure should serve as a guide in ascertaining the law applicable (not just foreign law) [14], as it is a combination of the iura novit curia principle and the autonomy of the parties.
I also believe the arbitrator should have the right to apply the legal rules that he considers to be applicable in a particular case, but the arbitral tribunal should not be bound to ascertain the content of the substantive law applicable. The fact that iura novit curia should be applied, as much as possible, in international commercial arbitration does not imply that the parties should not have the obligation to prove that existence and the interpretation of the legal norms they invoke.
Like I said before, having the obligation to ascertain the law applicable would be rather impossible in international arbitration, given that many times, the arbitrators have not studied the applicable law on the substance of the dispute.
In order to ensure that the dispute is settled in accordance with the correct application of the law, an arbitral tribunal would be required to conduct its own research, independently, in relation to the substantive applicable law of the underlying dispute – for example, in a case where the parties have not successfully provided adequate proof of the contents of the applicable law.
As international arbitration is not simply classified as pertaining to either the civil law or common law system, its flexibility provides the possibility to adapt the procedure to the individual circumstances of each case.
The arbitral tribunal should neither be bound to establish or ascertain the content of the substantive law and apply it ex officio, or assume the role of an observer and decide the case strictly by the information provided by the parties.
The iura novit curia principle should apply in arbitration in accordance with the latter’s set of core principles and objectives. In consequence, the parties should be given the right and the obligation to submit legal arguments for supporting their claims, including academic papers, case law or even independent expert opinion – while the arbitral tribunal should have the right to decide for itself which rules of law are applicable and how they must be interpreted, regardless of the provisions invoked by the parties, as long as they are put into the contradictory debate of the parties.
[1] See European Traditions in Civil Procedure, C. Van Rhee, p. 57
[2] The subject matter of the dispute may be modified by the interlocutory claims where they relate to the initial claims by a sufficient link
[3] Art. 5 Code de procedure civile
[4] See Viorel Mihai Ciobanu, New Civil Procedure Code with commentary, p. 22–23
[5] See J.A. Jolowicz Adversarial and Inquisitorial Models of Civil Procedure in The International and Comparative Law Quarterly, Vol. 52, No. 2 (Apr., 2003), p. 287–289
[6] Art. 24.2 The court may give summary judgement against a claimant or defendant on the whole of a claim or on a particular issue if:
(a) it considers that
(i) that claimant has no real prospect of succeeding on the claim or issue; or
(ii) that defendant has no real prospect of successfully defending the claim or issue; and
(b) there is no other reason why the case or issue should be disposed of at a trial.
(Rule 3.4 makes provision for the court to strike out(GL) a statement of case or part of a statement of case if it appears that it discloses no reasonable grounds for bringing or defending a claim)
[7] Power of court to control evidence
Art. 32.1 – (1) The court may control the evidence by giving directions as to:
(a) the issues on which it requires evidence;
(b) the nature of the evidence which it requires to decide those issues; and
(c) the way in which the evidence is to be placed before the court.
(2) The court may use its power under this rule to exclude evidence that would otherwise be admissible.
(3) The court may limit cross-examination.
[8] Gary B. Born, International Commercial Arbitration. Kluwer Law International 2014, p. 71
[9] Luttrell, Sam: Chapter 1: Bias in International Commercial Arbitration in Bias Challenges in International Commercial Arbitration: The Need for a “Real Danger” Test. Kluwer Law International 2009, p. 2
[10] See J. Lew, Comparative International Commercial Arbitration, p. 558
[11] See J. Lew, Comparative International Commercial Arbitration, p. 556–557
[12] See J.A. Jolowicz, On Civil Procedure, p. 186
[13] Rule 44.1. Determining Foreign Law: A party who intends to raise an issue about a foreign country’s law must give notice by a pleading or other writing. In determining foreign law, the court may consider any relevant material or source, including testimony, whether or not submitted by a party or admissible under the Federal Rules of Evidence. The court’s determination must be treated as a ruling on a question of law
[14] See J. Lew, Proof of Applicable Law in international Commercial Arbitration, p. 599 quoted in KAUFMANN-KOHLER, Gabrielle. The arbitrator and the law: Does he/she know it? Apply it? How? And a few more questions. In: Wirth, Markus. Best practices in international arbitration: ASA Swiss arbitration Association Conference of January 27, 2006 in Zürich. Bâle: Association Suisse de l’Arbitrage, 2006. p. 90
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