Originally from the Leading Arbitrators' Guide to International Arbitration - Fourth Edition

Preview Page

INTRODUCTION

There is always a danger that quantification of damages takes second place to issues of liability in preparation for international arbitration. Yet while a finding of liability is a prerequisite to any consideration of damages, quantification of damages is normally the issue of greatest relevance to the parties themselves. Damages represent in monetary form reimbursement for the loss suffered by the innocent party. In cases where the claim or counterclaim is for damages, an award favourable on liability alone is likely to be of no real value to a claimant or counter-claimant, unless possibly if it is a partial award in a bifurcated hearing and is a trigger for settlement. 

Assessment of damages can be a hugely complex process, both legally and factually. At the time of the Watergate scandal Deep Throat may have advised Bob Woodward to “follow the money,” to find out who was behind the Watergate break-in, but the achievement of a “finding for the money” or a favourable damages award in an arbitration can often require not dissimilar thoroughness and determination. To assume that establishing quantum is the easy part and can thus be put on one side is a trap the unwary should avoid.