Arbitration Under Government Contracts and Government Accountability
| Author | Caroline Henckels |
| DOI | http://doi.org/10.1177/0067205X221107407 |
| Published date | 01 September 2022 |
| Date | 01 September 2022 |
| Subject Matter | Articles |
Article
Federal Law Review
2022, Vol. 50(3) 404–418
© The Author(s) 2022
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DOI: 10.1177/0067205X221107407
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Arbitration Under Government
Contracts and Government
Accountability
Caroline Henckels*
Abstract
Much of the core work of government is now done pursuant to contract with private sector bodies,
primarily for efficiency reasons. While the phenomenon of contracting out of governmental
functions has attracted increasing scholarly attention in terms of public law accountability, the use of
commercial arbitration for the resolution of contractual disputes involving governments has until
recently attracted scant attention. The law regulating commercial arbitration does not distinguish
between arbitrations between private actors and arbitrations involving governments, treating all
commercial disputes as wholly private in nature. By controlling government action, arbit rators
contribute to governance but without the hallmarks of the judicial process such as impartiality,
transparency, the possibility for third-party participation and judicial oversight. As such, the law
does not take into account the public dimension of disputes under government contracts or the role
of arbitrators as adjudicators of public law disputes. Nor do there appear to be any constitutional
constraints on the use of arbitration in government contracts.
Received 28 February 2021
I Introduction
Much of the core work of government is now done pursuant to contract with private sector bodies,
primarily for efficiency reasons. When a government is acting in the exercise of its contractual
rights, its actions may well have a public interest dimension. The involvement of taxpayers’money
and governments’special responsibility to promote the public good in undertaking its activities
distinguishes government contracts from contracts between private parties.
1
Yet, government
accountability in relation to contracting decisions has traditionally been understood as a political
*Associate Professor, Faculty of Law, Monash University, Australia. The author may be contacted at caroline.henckels@
monash.edu. Thank you to Janina Boughey, Lisa Burton Crawford, Patrick Emerton, Graeme Hodge, Luke Nottage and
Stephan Schill for helpful discussions. Any errors are mine.
1. Cheryl Saunders and Kevin K F Yam, ‘Government Regulation by Contract: Implications for the Rule of Law’(2004)
15(1) Public Law Review 51, 52; Janet McLean, ‘For a Law of Public Contract Per Se: An Intervention from Liberal
Contract Theory’(2019) 39(4) Oxford Journal of Legal Studies 856, 857.
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