Use Of Expert Witness In International Arbitration - Notes For Lawyers And Enterprises

07/04/2021
 

Dr. Dang Xuan Hop

President of Hop Dang’s Chambers

VIAC Arbitrator

 

Whether settling disputes in Court or through arbitration, when a party has the burden of proof, it must submit evidence to the arbitral tribunal. The evidence can be in many different forms: Document electronic evidence, audio recordings, video recordings, witness statement, etc. In international arbitration practice, especially in complex disputes, a type of evidence that is frequently used by the parties to defend their opinion/request is testimony/report of "expert witness".

For example, a dispute arises between a Vietnamese enterprise and a foreign partner following a steel export. The dispute is brought to an arbitral tribunal, which can be constituted domestically (for example at the Vietnam International Arbitration Center) or abroad (for example at the Singapore International Arbitration Center) .

To interpret and convince the arbitral tribunal of the steel quality, reports containing specialized technical information[1] will usually be required as evidence. Therefore, the parties will either (i) select their own technical staffs to give testimony on the quality of steel; or (ii) invite an outside expert to provide reports who is usually an appraisal company or a reputable independent expert (usually a leading, reputable professor or expert in the industry and most importantly has no previous relationship with both parties) to confirm that the steel delivered conforms to the quality or not. This outside expert is the expert witness.

Most Vietnamese businesses or lawyers prefer the first approach, while enterprises or lawyers who are experienced in international litigation often choose the second option. It is because, in practice, an international arbitral tribunal is more likely to be persuaded by an expert witness’s evidence. Thus it usually decides in favor of parties providing the expert witness persuaded.  What is the reason for this phenomenon?

Issues in dispute are often ambiguous, thus, there is no certain winning or losing probability since both parties are equally persuasive. Under such circumstances, the testimony of an independent expert is often rated “heavier”, by:

First: although the expert is hired by one party, the expert has never had any affiliation with either party prior to being invited to be an expert witness of the dispute; thus, the expert accesses the documents of the dispute in an objective manner and operates independently from the parties and from the disputed transaction[2]; therefore, the Arbitral Tribunal tends to deem the opinion of such an independent expert reliable and there is little likelihood that the expert will forge a report inconsistent with their knowledge to benefit their hirer. Whereas, the testimony of an employee in the company or of an appraisal company with a long-term relationship with a party may be considered lack of independence, objectivity and completeness, or even be viewed as manipulation for the sake of their company.

Second, when comparing the expertise and experience, enterprises’ employees rarely have similar professional qualifications and reputation with an independent expert who has many years of experience in researching, writing books, and lecturing about this topic[3]. During cross-examination, an employee’s lack of experience and knowledge might be exploited by the other party's lawyer, revealing the irrationalities which make their testimony seem unreliable to the Tribunal. Meanwhile, an expert is able to explain and defend their stance based on in-depth knowledge or experience as an expert witness in similar cases.  

With more than 97% of surveyed enterprises responding they refer to arbitration as the method of resolving international disputes[4] and more than 92% of FDI enterprises in Vietnam refuse to use litigation for commercial disputes[5], it can be observed that the arbitration market has a lot of potential for development. Vietnamese lawyers, therefore, need to have an understanding of international best practices in arbitration and play well by the rules, so that when protecting the rights and interests of enterprises in arbitration proceedings, lawyers can devise appropriate strategies to improve the chance of winning in international arbitration advocacy./.

*This research paper is made to order by the Science Council under Vietnam International Arbitration Centre (VIAC) and only reflects the author’s opinion. VIAC uploads this paper on its official website with the aim of providing valuable information for the reference of the Arbitrators, the parties, other participants in the arbitral proceedings pursuant to VIAC’s Rules of Arbitration, as well as those who are interested in arbitration. Any reference and citation to this research made by a third party shall not be valid or recognized by VIAC. VIAC shall not explain or answer any requests or inquiries related to this research from a third party. 

 

[1] Assessing the quality of goods is often less complicated than evaluating the quality of a task (for example,  the construction of a factory building); But to simplify, I have taken an example of a sale of good transaction.

[2] In developed jurisdictions, there are professional consulting firms providing reputable experts in multiple fields: construction, finance, insurance, etc.

The ICC even has a unit dedicated to appointing experts service, including experts in creating reports to serve parties in international arbitration at ICC International Center for Expertise

[3] A typical example: Regarding matters that require the opinion of a legal expert, i.e.: how to understand and interpret the provisions of a country's law, parties often invite law professors at prestigious universities in that country to be expert witnesses and provide their opinions in expert reports. It is hard to assume that an employee in a corporate legal department would have similar knowledge and experience with a law professor in this case.

[4] Report of Queen Mary School - University of London 2018, page 05, http://www.arbitration.qmul.ac.uk/research/2018/

[5] Provincial Competitiveness Index (PCI)

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