California Supreme Court
Apr. 28, 2017
Appointed group favors allowing out-of-state attorneys in international arbitration
A working group appointed by Chief Justice Tani G. Cantil-Sakauye strongly backed allowing foreign and out-of-state attorneys to represent clients in California-based international commercial arbitration.
A working group appointed byChief Justice Tani G. Cantil-Sakauyestrongly backed allowing foreign and out-of-state attorneys to represent clients in California-based international commercial arbitration.
The report, issued Tuesday by the 11-member California Supreme Court International Commercial Arbitration Working Group, notes thatthe state currently "lags behind other jurisdictions," including Paris, London, New York and Singapore, as a neutral venue for resolving cross-border disputes out of court.
Parties may prefer international commercial arbitration over litigation to obtain resolutions across multiple jurisdictions to transnational conflicts.
However, California currently prohibits lawyers who are not licensed in California from representing clients in such international arbitration.
In 1998, thestate Supreme Court ruled 6-1 that a New York law firm's representation of a California-based client in arbitration based in California violatedstate law. Birbrower, Montalbano, Condon & Frank PC v. Superior Court, 17 Cal.4th 119 (1998).
"Notwithstanding California's robust economy, legal infrastructure, and size, the inability of foreign and even out-of-state U.S. companies to be represented by their existing counsel has given California a reputation as hostile to international commercial arbitration," the working group report states.
The working group suggested that thestate Supreme Court could establish a new rule that allows non-California attorneys to represent clients in international commercial arbitration. However, the working group ultimately recommended that the high court work with state lawmakers to pass a new law.
It is uncertain how the high court will use the report. Cantil-Sakauye said in a prepared statement that she was pleased with the working group's "thoughtfulness and expeditiousness."
Cantil-Sakauye created the working group in February and appointed its members. Gibson, Dunn & Crutcher LLPpartner Daniel M. Kolkey,a former justice of the 3rd District Court of Appeal, chaired the working group.
Kevin Lee
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