Impartiality and Disclosures of Judges and Arbitrators
For a dispute resolution system to work, it is critical that the decision-maker be fair and impartial. No one will trust a system that doesn’t seek to ensure that is the case. This is true for both judges and arbitrators.
But the way that plays out in the real world for judges and arbitrators isn’t exactly the same.
Judges
At one time the only grounds for disqualification of a judge and in English and U.S. courts was a pecuniary interest in a matter. Thus, that a party was a “table companion” of the judge or an “enemy of a judge’s kinsman,” would not provide grounds for disqualification. See Rendelman, When must a judge recuse over a personal relationship?, ABA Journal Online(September 5, 2019)( http://www.abajournal.com/web/article/judges-personal-relationships-formal-opinion-488).
But now disqualification is required where “impartiality can be reasonably questioned,” the standard now in the Model Code of Judicial Conduct. A recent ABA Formal Opinion interpreting the Model Code addresses impartiality of judges in the context of a judges’ relationships, focusing on acquaintances, friendships , and close personal relationships. American Bar Association Standing Committee on Ethics and Prof. Resp., Formal Opinion 488 (September 5, 2010) (https://www.americanbar.org/content/dam/aba/administrative/professional_responsibility/aba_formal_opinion_488.pdf)
Acquaintances
A judge and lawyer or party should be considered acquaintances “when their interactions outside of court are coincidental or relatively superficial, such as being members of the same place of worship, professional or civic organization, or the like. “ Such an acquaintance, standing alone, is not enough to require disqualification. Opinion 488 at 4. The judge is not required to disclose an acquaintance with a party or lawyer in a proceeding. But, the judge may disclose the acquaintance if he or she would like to. Id.
Friends
Friendship implies more than a mere acquaintance and, according to the Opinion, some degree of mutual affection. Judges need not disqualify themselves in all cases where a party or lawyer is a friend and need not disclose all friendships.
But a judge should disclose to the lawyers or parties information about any friendship with a party or lawyer “that the judge believes the parties or their lawyers might reasonably consider relevant to a possible motion for disqualification, even if the judge believes there is no basis for disqualification.” If a party objects to the judge’s participation, the judge has discretion to decide whether or not to recuse him or herself, putting the reasons for the decision on the record.Opinion 488 at5 – 6.
Close personal relationships
Rule 2.11(A)(2) of the Model Code requires recusal where the judge knows that the judge, the judge’s spouse or domestic partner, or a person within the third degree of relationship to either of them, or the spouse or domestic partner of such a person is (1) a party to a proceeding (or an officer, director, general partner, managing member, or trustee of a party), (2) acting as a lawyer in the proceeding, (3) a person with more than a de minimis interest that could be affected by the proceeding, or (4) likely to be a material interest in the proceeding.
But what of other relationships that do not implicate rule 2.11(A)(2)? Opinion 488 provides some examples. If, for example, a judge is romantically involved with a party or its lawyer, or wants to be, the judge must recuse him or herself. Id. at 6. A judge should disclose other close relationships with a lawyer or party. If a party then objects, the judge may participate over the objection only if the judge believes he or she can remain impartial. Id.
Waiver
The parties may waive disqualification of the judge after disclosure on the basis of either a friendship or close personal relationship. Model Code, Rule 2.11(C).
Arbitrators
The standard for commercial arbitrators is much the same as that for judges. The Code of Ethics for Arbitrators in Commercial Disputes requires arbitrators to disclose “any interest or relationship likely to affect impartiality or which might create an appearance of partiality.” Code of Ethics, Cannon II. That is close to a situation where “impartiality might reasonably be questioned,” which applies to judges.
But arbitrators’ disclosure obligations are a little more inclusive than that of judges. Of course, much like Rule 2.11(A)(2) of the judicial code, known direct or indirect financial or personal interests must be disclosed. The same goes for those of family members, household members. Canon II (A). But because arbitrators often have a professional life apart from being arbitrators, they must also disclose the interests of employers, partners, or business associates. Id. They must also disclose any relationship they personally have with any party or lawyer, co-arbitrator or potential witness that could reasonably affect impartiality. Id. And they must disclose any prior knowledge of the dispute. Id.
Arbitrators typically make disclosures, and it is up to the party to object. If they do not, the objection is waived. But if an Arbitrator is not confident he or she can serve impartially, he or she is ethically bound to withdraw. Canon I (B).
Much the same – but different
The disclosure obligations of judges and arbitrators are quite similar, although because arbitrators are often practicing lawyers or businesspeople, additional matters are necessarily covered. Still, there are practical differences.
Who decides?
One difference is that judges typically decide on their own impartiality, subject to later appellate review. But, in arbitrations, the arbitration organization – AAA, JAMS or another – takes up the issue at the outset, unless the arbitration is not administered. Having a quick decision by a neutral decisionmaker on questions of impartiality is one significant benefit of an administrated arbitration.
Arbitrators often disclose more
Of course, some judges do that as well. But my experience has been that arbitrators disclose things most judges would not. In fact, many arbitrators disclose to a fare-thee-well. The extent of the disclosures can even be confusing, particularly to those more used to court. “Why would the arbitrator disclose that?” they may well wonder.
Another difference is that arbitrators disclose more than most judges do. This may be because one of the few grounds for vacating an arbitration award is “evident partiality.” A court may find evident partiality where an arbitrator fails to reveal facts that could reveal a conflict of interest. See Applied Indus. Materials Corp. v. Ovalar Makine Ticaret Ve Sanayiu, A.S., 492 F.3d 132, 136 (2d Cir. 2007). Wanting to avoid any claim that they failed to reveal a relationship and thereby risk having the award challenged, most arbitrators apply the maxim of “if in doubt, call it out.” If they wonder whether they should disclose a relationship, they error on the side of disclosure. No arbitrator wants to be named in a court decision addressing a motion to vacate an award of being guilty of evident partiality, even if the motion not successful.
But over-disclosure is not a bad thing. Arbitration awards are typically not subject to appellate review on the merits. Unless the parties have opted for an arbitral appeal, typically review of an award is only on grounds of evident partiality, corruption, exceeding authority, or the like. See 9 U.S.C. § 10. Misapplication of the law or erroneous findings of fact are not included. Thus, it is only right that arbitrators are very careful about disclosing all relationships that the parties need to be able to consider to be assured of a fair and impartial decision-maker.