Arbitration Clauses: What Law Governs and Who Decides

Author: Peter Swanson


The title of this article “Arbitration Clauses: What Law Governs and Who Decides” raises questions that are addressed by the area of law known as “conflict of laws” or “private international law”. What this area of law deals with is the conflict that can arise in international transactions between competing legal systems. Conflict of law rules try to resolve the question of what law applies to a particular legal problem. So, for example, there are rules in Canada, and other countries, used to determine what law would apply if a Swiss chartered airplane (built in Seattle) flying from London to Vancouver and carrying nationals from 15 countries crashes with the initial impact taking place in Saskatchewan, the second impact taking place in Alberta with the plane then ploughing across the border into Montana where it comes to rest. Likewise, those same conflict of law rules would be used to determine the applicable law where an American canal pilot, employed by the Panama Canal Commission is injured during the course of a Canal transit while on board a vessel owed by a Canadian company with a port of registry at Edmonton, Alberta and who sues in Vancouver. More germane to this article, conflict of law rules are also used to determine what law should govern contracts entered into between parties, whether or not there is an express choice of law clause in the contract. So, for example, conflict of laws rules would be used to determine the proper law of a voyage charter entered into between a Greek shipowner and a B.C. forest company, negotiated through brokers in New York and Montreal respectively, and signed in London by the Greek shipowner and an agent of the B.C. forest company, for the carriage of lumber from Vancouver to China.

About Peter Swanson

Peter is a founding partner of the firm with over 30 years of professional legal experience. He practices primarily in the fields of maritime and health law. Peter’s maritime case work involves vessel arrest and security, carriage of goods by sea, enforcement of maritime liens, civil and regulatory liability for ship source pollution, collision, port state intervention, immigration, bodily injury,… view full profile »