The Problem of Issue Preclusion of an Arbitral Award

This article substantiates the political and legal necessity of regulating the preclusive nature of arbitral awards in order to ensure legal certainty, procedural efficiency, and reduce the risk of inconsistent enforcement decisions involving the parties. Since the development and maintenance of effective alternative dispute resolution in the country is one of the objectives of state judicial policy, regulating the preclusive nature of arbitral awards will demonstrate public confidence in arbitration as a significant jurisdictional institution. The exclusion from the subject of proof in other cases involving arbitration parties of circumstances already confirmed by a binding arbitral award is necessary as a logical consequence of extending the res judicata standard to such enforcement decisions. The binding and exclusive nature of an arbitral award necessitates a party to arbitration to comply with the factual circumstances underlying the award. The article criticises the doctrine’s proposal to grant arbitral awards issue preclusion powers following the exercise of supervisory functions by competent courts, as such procedures do not involve a review of the merits of the case. Furthermore, it is inadmissible to distinguish between the legal force of an arbitral award voluntarily executed by the parties and one that has undergone a challenge, exequatur, or counter-exequatur procedure.It is argued that the confidentiality of arbitration proceedings cannot prevent a party to the arbitration, another interested party, the arbitrator, or the tribunal from invoking the arbitral award when considering a related case. Due to the binding nature of an arbitral award and the need to exercise their rights and obligations in good faith, parties are not entitled to conceal from law enforcement authorities the fact that a related case is being considered in arbitration.