Chief Justice Sundaresh Menon: Keynote Address delivered at the Standing International Forum of Commercial Courts (SIFoCC) Meeting 2022

A. The importance of a transnational system of commercial justice

6. Whatever shape the future of globalisation takes, the law will remain a critical part of the infrastructure of commerce. This can be traced back to early civilisations, but a more proximate starting point for understanding the law’s role in transnational commerce is the law merchant, or lex mercatoria: a common body of rules and customs widely adopted by merchants in Europe around the Middle Ages.[5] This was a system of law where rules were applied throughout the trading region in a broadly consistent way by means of a network of courts and informal adjudication that prioritised speed and efficiency.[6] From the 17th to the 19th centuries, these rules were gradually assimilated into national legal systems and largely lost their transnational character. As a consequence, international commercial law is today often thought of less as part of a coherent system and more as a hodgepodge of rules from different sources.

7. I suggest that a renewed focus on a modern notion of a transnational system of commercial justice will be essential in a globalised world. To explain this, it will be necessary to outline what is meant by a transnational system of commercial justice. At its most rudimentary, a legal system is a public framework of laws accompanied by institutions which make and develop those laws, and which seek to interpret and apply them in a broadly consistent manner, thereby offering a basis upon which differences can be resolved fairly. At a domestic level, we know what this means. But since the nationalisation of the lex mercatoria, it has been less obvious what it means in a transnational commercial setting. Yet, while we do not seek a supranational legal system, we can effectively achieve many of the benefits of having such a system to facilitate transnational commerce by seeing the many discrete players and processes that do regulate aspects of commerce as though they were part of a system, at least on a conceptual level.

8. But why should we do this, even assuming it were possible? At the most fundamental level, this is because legal differences and uncertainty increase transaction costs and hamper growth.[7] And these costs will only increase with new risks in emerging areas, such as artificial intelligence and data privacy, that inevitably will have a transnational impact while also necessitating new ways of regulating modern business. In addition, cross-border business activity inevitably leads to cross-border commercial disputes, and this adds another layer of increased costs. A focus on fostering a transnational system of justice would prioritise the convergence of commercial laws where possible, and the minimisation of the inefficiencies that inhere in transnational dispute resolution. 

9. Now, this seems a mammoth task to be sure, made even more difficult to navigate by the fact that different components of it have been worked on variously by different stakeholders over the course of the past few decades. Yet, somewhat ironically, it is because of this steady work on so many fronts that the transnational system of commercial justice is already in existence as a work in progress. Let me briefly illustrate this with reference to two of its facets: convergence in procedural law and in substantive law.

10. Beginning with procedural law, the exemplar for meaningful convergence is the set of rules of private international law governing arbitration agreements and awards. At its centre are the 1958 New York Convention,[8] which, with 170 parties and counting,[9] has created an almost universal regime for the enforcement of arbitral awards; and the UNCITRAL Model Law on International Commercial Arbitration, which is very widely adopted today.[10] These instruments create a robust and vitally important framework for managing the resolution of disputes by channelling them to the right venues and then avoiding the unnecessary re-litigation of issues by foreclosing the review of arbitral awards on their merits.[11] Such a perspective rests on a systematic rather than a court- or jurisdiction-centric approach to transnational commercial justice.[12]

11. There have also been long-standing efforts at achieving convergence in substantive law, such as through the Convention on Contracts for the International Sale of Goods (or “CISG”).[13] Today, however, we can expect to face an ever-growing set of legal issues that have an inherently transnational character – such as those arising from our responses to challenges like climate change and global public health. For example, disputes arising from projects under the Green Climate Fund of the UN Framework Convention on Climate Change (or “UNFCCC”) have already come before arbitral tribunals.[14] These and other disputes may turn on the commitments made under the Paris Agreement, national rules or policies made to implement those commitments, and the actions of individuals or businesses in response to these events. Another example is the Chancery Lane Project, which has contributors from 113 countries. It has published a set of template contractual clauses which can be inserted into a range of business contracts to mandate the pursuit of climate-related priorities.[15] If the project is successful, it will soon fall to arbitral tribunals and commercial courts to interpret these clauses when contractual disputes arise. The legal norms arising from these decisions have the potential to become the transnational norms that will guide the greener conduct of global commerce. We will significantly handicap our ability to mount a coordinated response to such global challenges if we were to approach these disputes in an ad hoc fashion or in national siloes, instead of striving to achieve broad and thoughtful consistency in the approach we take to the interpretation, development and application of these norms, or at least to ensure that any divergences are principled.

C. International judicial dialogue as a driver of convergence

13. The examples I have just discussed also illustrate the importance of what I call the drivers of meaningful convergence. In domestic law, we take it for granted that the law is made and refined by legislatures and courts. On the international plane, there is no single authority that has responsibility for the development of the law. Instead, convergence is driven by a multitude of stakeholders with varying degrees of coordination. Prime amongst these are international organisations, such as UNCITRAL, which promulgate international instruments such the Model Law and the CISG. 

14. But another key driver of convergence is international judicial dialogue. This takes place on at least two levels: First, through the means that is especially well-known to the common law – the publication of judgments which are then read by practitioners and by courts in other jurisdictions. The cross-citation of authorities across different jurisdictions is an important way in which we ensure that the law develops in a manner that is cognisant of other pertinent positions and considerations.

15. Second, and less frequently appreciated, is direct communication and collaboration between judges across jurisdictions. I suggest that the transnational system of commercial justice benefits tremendously from such exchanges, which are an often-overlooked source of strength for a court system: it helps judges keep abreast of legal developments emanating from their colleagues across the world and provides them with a sounding board for their own thoughts and ideas.

16. This is where we see the genius that lies behind the establishment of SIFoCC as an international community of commercial judges. In the five years since its establishment, SIFoCC has already accomplished a number of notable feats, of which I highlight just these:

(a)   SIFoCC has developed and published a Multilateral Memorandum on Enforcement of Commercial Judgments for Money, with each contributing judiciary explaining the legal position in their own jurisdiction.[16] While the Memorandum is not legally binding, it provides clear and reliable information that can give judges much greater confidence in understanding the implications of their rulings in transnational cases and afford litigants the comfort of knowing how they can monetise their judgments. With such a tool, we take a significant step towards achieving meaningful convergence in an area of law of central importance to commercial users.

(b)   SIFoCC has also published a set of guidelines summarising international best practices in case management, incorporating the input of judges from more than a dozen jurisdictions.[17] This document provides an excellent starting point for courts to develop their own principles on effective case management, a vital capability for effective commercial dispute resolution. 18. I begin by suggesting that we should first acknowledge the reality that the ICDR system encompasses not only litigation, but also arbitration, and increasingly, mediation and other forms of dispute resolution. A commercial dispute today will frequently flow across these different mechanisms. To take one example, most complex infrastructure projects benefit immensely from the work of dispute boards, which can dramatically reduce what remains in dispute at the end of the project, to be resolved by further mediation, arbitration, or litigation.[19] More commonly, the enforcement of an arbitral award or a mediated settlement agreement will typically lie in a commercial court, sometimes in a different jurisdiction from that of the law governing the arbitration or mediation. And multiple proceedings on the same or similar matters may arise in different jurisdictions or fora, raising the question how each should regard the related proceedings in the others, especially where a judgment or award has already been rendered.


20. In the commentary that opens the SIFoCC Multilateral Memorandum on Enforcement of Commercial Judgments for Money, the learned authors observe that there is a “gradual drawing together of the approaches of the civil and common law jurisdictions”,[20] but they also recognise that the rules in this area are complex and not always capable of generalisation.[21] I think the same can be said for much of the law of jurisdictional conflict. SIFoCC offers the ideal platform for meaningful engagement over such issues, and we have the opportunity to begin doing so under Theme 4 tomorrow. Perhaps, through such a forum, it might be possible to aspire to reach a common understanding of what the principles are, and to produce another Multilateral Memorandum, which would be a tremendous service to the international business community. 

ii. Standards for the conduct of arbitration and mediation

21. Adopting a systematic perspective would likewise enable us to see commercial courts as playing a vital role in maintaining quality standards for the conduct of arbitration and mediation. In the context of arbitration, courts will have to rule on contests as to the fairness of the process and on allegations of breach of natural justice. In doing so, they must strike a balance between safeguarding the integrity of the arbitral process, and not permitting disgruntled parties to contrive such allegations just to set aside the award – a phenomenon that has led to the coining of the term “due process paranoia”.[22] Divergence in the jurisprudence of different courts on these standards can cause confusion and compromise the conduct of effective arbitration.

22. With the increasing adoption of the Singapore Convention on Mediation, commercial courts will soon be faced with similar challenges arising from mediated settlement agreements. One ground for the refusal of enforcement under the Singapore Convention is a “serious breach” by a mediator of standards applicable to the mediation.[23] It will fall upon commercial courts to consider and articulate what amounts to such a “serious” breach, and broad consistency across jurisdictions will be equally important here.

B. Enhancing the efficacy of adjudication

24. A second facet of ICDR in which SIFoCC can lead the way is in raising the effectiveness of adjudication and the capabilities of adjudicators. I have in mind new types of issues or challenges that all of us involved in international dispute resolution are likely to face. Let me illustrate this with some examples.

i. Complexification

25. I begin with the challenge of complexification. This is the phenomenon of disputes becoming so factually rich and technically complex that they threaten to become virtually impossible to adjudicate in the traditional ways, because they surpass the ability of any single adjudicator to fully comprehend and analyse. Solutions that aim to increase the efficiency of adjudication are important but can only take us so far.[24] When faced with a truly complex dispute, an adjudicator will have to find more drastic approaches to downsize it to a manageable scale. These may include relatively radical ideas that might challenge our traditional assumptions, such as representative sampling, bellwether trials,[25] and the use of summary procedures to dispose of lower-value claims in large trials.[26] There is immense value to be had if these ideas were studied, discussed and shared across as wide a community of dispute resolvers as possible. Not only would this promote their acceptability, it would also shine a light on mistakes and best practices alike for our collective benefit. 

26. The value of seeing other disciplines, such as mediation, as part of an integrated ICDR system becomes especially evident in this context. Litigation and arbitration tend to be rights-based approaches to dispute resolution, whereas mediation is generally more interest-based. But these are not binary options. Sometimes, our interests may lie in moderating our insistence upon our rights and we can do this by incorporating techniques such as mediation or early neutral evaluation within the adjudication process itself.[27] This has been used to great success in complex insolvencies. A good example of this was in the collapse of Lehman Brothers, where the mediation protocol adopted by the US Bankruptcy Court resulted in the settlement of hundreds of cases yielding billions of dollars for creditors.[28] Even where the whole dispute cannot be settled, the incorporation of such techniques can reduce the number and scope of procedural and substantive disputes that the court must rule on. Is it not time for us to engage in these dialogues with our fellow dispute resolvers? Theme 2 of this Meeting started precisely such a dialogue, and SIFoCC affords a platform for us to continue that conversation – perhaps with the aim of finding ways to combine our diverse crafts in a shared commitment to better serve those engaged in transnational commerce.


34. I suggest that we now look into establishing formal partnerships between SIFoCC and some of the leading arbitration and mediation institutions so as to formalise our working relationships with them. This would recognise and underscore the importance of a systematic approach to ICDR and to the development of transnational commercial law. I suggest that we further consider including representatives from the world of arbitration and mediation in the SIFoCC working groups, so as to ensure that SIFoCC’s endeavours are developed from the perspective of an integrated ICDR system. In the more distant future, we might envisage the establishment of a research unit and the publication of materials that promote the systemisation of ICDR. This might even see us collaborating with organisations such as the Asian Business Law Institute, the European Law Institute and the American Law Institute on the development of international commercial law, or perhaps engaging in dialogue with other bodies actively pursuing the project of convergence.

35. As SIFoCC’s membership and partnerships grow, this will further enrich the ongoing conversation among the stakeholders in the transnational system of commercial justice. This will help ensure that commercial courts and other dispute resolution providers around the world are equipped with the knowledge, tools and practices to support the delivery of justice nationally and internationally. Justice David Barniville spoke for all of us this morning when he highlighted how much we have learnt from the conversations we have had today. We will need all the help we can get if we are to address the global challenges to which the flourishing of the world economy, and indeed our collective fates, are tied, and SIFoCC promises to be a vital ally in that endeavour.

36. The vision I have outlined might seem like a moon-shot, but it is a worthwhile goal because there will be many gains to be had from securing such a system, built on a shared vision and a mutual understanding among judges and dispute resolvers around the world. That such a system might help our world meet challenges as important as poverty and climate change underlines the responsibility on us, together, to keep this work going. And it is made more exciting by the fact that we have actually already commenced our journey. It has been my privilege to present it to you this evening. Thank you. 

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[10]   With the 2005 Hague Convention on Choice of Court Agreements (the Convention of 30 June 2005 on Choice of Court Agreements (entered into force on 1 October 2015))and the Singapore Convention on Mediation (the United Nations Convention on International Settlement Agreements Resulting from Mediation (20 December 2018, entered into force on 12 September 2020)), the international dispute resolution community has been working to replicate the success of the New York Convention in litigation and mediation respectively.

[11]     And there is a further possible dimension to preventing relitigation by holding that in at least some circumstances, an application to resist enforcement of an arbitral award should be determined with reference to the outcome of a similar earlier application, whether before a different enforcement court, or to set aside the arbitral award in the seat court. There are differing views on this, but I have argued elsewhere that the best approach would be to apply the doctrine of issue estoppel transnationally, so that if the criteria for issue estoppel are satisfied, a party should not be allowed to relitigate the same ground for resisting enforcement after the issue has already been decided by another court: see Sundaresh Menon, “The Role of the National Courts of the Seat in International Arbitration” (Keynote address at the 10^th Annual International Conference of the Nani Palkhivala Arbitration Centre, 17 February 2018) at https://www.judiciary.gov.sg/news-and-resources/news/news-details/chief-justice-sundaresh-menon-keynote-address-delivered-at-the-10th-annual-international-conference-of-the-nani-palkhivala-arbitration-centre-2018-the-role-of-the-national-courts-of-the-seat-in-international-arbitration at para 32.

      On the other hand, it should be noted that issue estoppel will typically not apply where the ground for setting aside is public policy, since the issue before each court is whether the award is consistent with the public policy of the jurisdiction where the court is located, and there is therefore no identity of subject matter in relation to this issue when it is decided in different jurisdictions (see ibid at para 34).

[12]     Similarly, in relation to the process of international dispute resolution, it is unsurprising that international commercial arbitration has led the way in promoting convergence in the conduct of dispute resolution, since it tends to involve parties hailing from different legal traditions. The International Bar Association’s Rules on the Taking of Evidence in International Arbitration, first adopted in 1999, sought to harmonise this process by borrowing from practices developed in common law and civil law jurisdictions, as well as those indigenous to international arbitration. See IBA Rules of Evidence Review Task Force, Commentary on the revised text of the 2020 IBA Rules on the Taking of Evidence in International Arbitration (2021) at https://www.ibanet.org/MediaHandler?id=4F797338-693E-47C7-A92A-1509790ECC9D, at p 3.