William & Mary Business Law Review
Abstract
The U.S. Supreme Court justifies the broad enforceability of arbitration agreements with the notion that arbitration expands parties' autonomy to contract for an efficient alternative to court proceedings. Unfortunately, the current practice of both domestic and cross-border commercial arbitration does not fully live up to these expectations. It is crucial to both autonomy and efficiency theories of contract law that adjudicatory decision-making is predictable so parties can tailor their contracts accordingly. However, commercial arbitration's prevailing culture of confidentiality and lack of stare decisis diminishes commercial certainty. To bring the reality of commercial arbitration closer to the Supreme Court's reasoning, this Article proposes a method of empirical legal research that helps uncover patterns of arbitral decision-making and articulate arbitration's "rules of regularity." It also offers a proof of concept by presenting an original quantitative text analysis of unpublished arbitral awards from the International Court of Arbitration, which focuses on the arbitral assessment of compensatory damages in breach-of-contract disputes. That study uncovers three substantive and procedural rules of regularity, which future transactors can accept or contract around when negotiating damages and arbitration clauses.