Calderbank Offers - Powerful Weapon or Blunt Sword?

Arbitration proceedings have become lengthy and costly. Further, the allocation of costs is considered to be uncertain and unpredictable.36 Parties therefore look for available tools to reduce and control their costs. An example of such tool which has "moved into the spotlight",37 are Calderbank offers. They stem from an English Appeal Court decision of the same name. In contrast to other kinds of offers, Calderbank offers intend to have an effect on cost allocation. Especially in cases where the tribunal has discretion to decide upon the costs, they can be an additional factor to be considered. The potential to be a powerful weapon lies in the possibility of an early settlement avoiding further costs. They also support the parties to carefully assess their case with regard to drafting and rejecting an offer and encourage the principle of good faith between them. However, they can end up as a blunt sword because of an unfamiliarity with Calderbank offers. It is also shown that in some cases they have not been taken into consideration by tribunals, which leads to a further blunting. The efficient use of Calderbank offers will thus also depend on a successful implementation in the case management conference and the terms of reference. [ABSTRACT FROM AUTHOR]