Legal precedents in arbitration: Are judicial, constitutional, and arbitral precedents binding?

Abstract

In this paper, the author examines the relationship between arbitration and precedents within the Peruvian legal system, addressing the question of whether arbitrators are bound by judicial, constitutional, and arbitral case law. To this end, the author begins by drawing a conceptual distinction between precedent in the common law tradition and the so-called continental precedent, in which precedents are conceived as abstract rules or general maxims derived from prior decisions. On this basis, the author analyzes the regulatory framework and the binding effects of civil precedents issued by the Supreme Court, the precedents and constitutional case law of the Constitutional Court, as well as arbitral practice concerning the invocation of prior awards. The author argues that arbitrators are not legally bound by civil judicial precedents nor by so-called arbitral jurisprudence, although they are required to take constitutional precedents into account by virtue of the normative supremacy of the Constitution. Furthermore, the author contends that, even in the absence of a formal obligation to follow civil or arbitral precedents, their reasoned consideration may be relevant in order to mitigate the risk of annulment of the award and to enhance the coherence and legitimacy of arbitral reasoning.