"US Spotlight" blog series: demystifying Swiss arbitration for the US litigator (Volume 8 of 10)

This blog series provides the US litigator with a practical understanding of Swiss arbitration. It compares a Swiss arbitral proceeding under the Swiss Rules of International Arbitration ("Swiss Rules"), though other rules, e.g., the International Chamber of Commerce ("ICC") Rules, are often used, with a dispute in US Federal District Court ("USDC").

Pre-hearing meeting

The tribunal will hold a pre-hearing meeting with the parties a few weeks before the hearing. This may well be done over the phone, it is less imperative to make an in-person impression here as compared to the organizational conference because impressions by now will have been well-established. Procedure and logistics will be addressed in a collaborative manner.

Hearings usually begin with opening statements by both sides. In a simple dispute that has been well-briefed, it is possible to waive opening statements. However, if one party insists on opening statements, the tribunal is likely to rule that they will go forward for both sides to avoid objections that the right to be heard has been violated. Art. 15(1) Swiss Rules. Strict time limits are often imposed. This may be as much as 60-90 minutes per party for a complex dispute to as little as 15-20 minutes apiece.

Each party will verify what witnesses it will put forth for testimony, including expert witnesses, and which witnesses of the other side it plans to cross-examine. Art. 25(2) Swiss Rules. Testimony from any tribunal appointed experts will also be worked into the schedule. It will be necessary to allocate the amount of time for the direct, cross, and redirect examination of each witness. As a rule, the majority of the time is allotted for cross, e.g., 15 minutes direct, 75 minutes cross, 10 minutes redirect.

In certain instances, a party may choose to waive the cross-examination of a witness. In this case, the witness's written statement will be afforded credibility whether he appears to testify or not, though the account of facts included therein is neither acknowledged nor proven. When cross-examination has been waived, the tribunal may rule in such instances that the witness cannot testify at all. Should the witness's party insist on bringing him forth at the hearing for testimony, e.g. to buttress credibility, the testimony is likely to be granted to avoid violating a party's right to be heard but limited to a very short direct examination, e.g., 10 minutes, only on matters explicitly addressed in the witness statement. Art. 15(1) Swiss Rules. In these circumstances, the counterparty may be afforded a few minutes of "follow-up questions," but nothing else—the tribunal will not resuscitate a party's cross-examination right if it does not like what a witness said during a brief direct examination.

The parties will either make closing statements or submit post-hearing briefs, viz., the form of the "final word". While this decision ultimately rests with the tribunal, if the parties agree on one or the other, the tribunal is likely to go along.

The determination of how many, and which, representatives from either party will be allowed in the hearing room often takes consideration. Unlike USDC trials, hearings take place in smaller, private conference rooms and are presumptively in camera. Art. 25(6) Swiss Rules. As the confidentiality and privacy of the proceedings is paramount, the tribunal works to minimize the number of attendees.

Mundane considerations like the appointment of a court reporter and whether interpreters will be necessary are also addressed at the pre-hearing meeting.

Opening statement

Opening statements in Swiss arbitration are less theatrical than those in USDC, particularly USDC jury trials. There are no juries in Swiss arbitration. Jokes, heavy-handed analogies, cultural references et al., which can break the ice before a jury, could well fall flat before a tribunal. While likeability is always a factor in persuasion, it matters less before a tribunal than a jury.

The mechanics of an opening statement in Swiss arbitration can seem as deliberate and controlled as writing a brief. Each party frames the case in its most favorable light, and also provides a roadmap of the points it intends to illuminate through the direct and cross-examinations that will follow. Counsel may use PowerPoint or some form of visual tool, and such visual tools are usually shared with the tribunal and counterparty. Essentially, an additional written submission that would never make it back into the deliberation room, or judge's chambers, in USDC without an independent basis.