Paolo Michele Patocchi, Switzerland

Partner at Patocchi & Marzolini, Arbitrator

Michele graduated from law school in Geneva in 1977. He specialised in the law of international trade and arbitration in London (1986-1988) and joined an international law firm in London as an associate (1989-1991). In 1992, Michele joined a national law firm in Zurich, and he has worked as counsel and arbitrator ever since. In 1994 he moved back to Geneva and joined another national law firm where he was made a partner in 1997. He has been in charge of the International Arbitration Group of the Geneva office of that firm from 1997 until 2013. In 2014 he established Patocchi & Marzolini with Paolo Marzolini.

As counsel or as an arbitrator, Michele has taken part in over 240 international arbitrations to date. He has also advised on the Swiss law of contract, the Swiss law of international arbitration and the Swiss private international law, as an expert or amicus curiae. As a practising lawyer or as an arbitrator, Michele has been called upon to work on matters involving several legal systems other than Swiss law, including in particular the laws of Albania, Algeria, Austria, Belgium, Brazil, China, Egypt, England and Wales, Ethiopia, France, Germany, Hungary, India, Italy, Jordan, Kazakhstan, Kuwait, Latvia, the Netherlands, Palestine, Peru, Poland, Portugal, Romania, Qatar, Russia, Spain, Turkey, the UAE, the U.S.A. and Venezuela.

Michele has been a lecturer at the Faculty of Law of Geneva (1989-2006) and he has been teaching international commercial arbitration at the Faculty of Law of İ. D. Bilkent University (Ankara) since 2013. He taught the first five-day module (Introduction to International Arbitration) at the Swiss Arbitration Academy in October 2008 and October 2009.

Michele has also been active in international law. He has been on the ICSID list of arbitrators since 2012 (List of arbitrators designated by the Swiss Government) and has been involved in two ICSID cases, two ICSID Additional Facility Rules cases, one ICSID annulment case and one case under the OIC Treaty.

He has been a member of the team in charge of representing the Swiss Confederation before the International Court of Justice in the legal proceedings brought by the Kingdom of Belgium concerning an alleged breach of the Lugano Convention by Switzerland. These proceedings were withdrawn by the Kingdom of Belgium after Switzerland filed its first memorial setting out its preliminary objections.

Michele has collaborated with the arbitral institutions of the Swiss Chambers of Commerce in the past two decades. After the arbitration rules of the Swiss Chambers were unified in 2004, he was the first President of the National Arbitration Committee and the Special Committee in charge of hearing challenges (2004-2006) and a member of the Arbitration Court of the Swiss Chambers’ Arbitration Institution from 2013 to 2016. From 2005 to 2011 he has been a non-resident member of the Arbitration Committee of the Milan Chamber of Commerce. From 2001 to 2019 he has been a member of the Board of the Swiss Arbitration Association.


The arbitration landscape is changing for the better in Turkey

Dr Paolo Michele Patochhi is one of the founding partners of Patocchi and Marzolini, a leading law firm specialising in international arbitration in Geneva. He shares his perspectives as an arbitrator and counsel on the differences between acting as an arbitrator and a dispute-handling professional as well as the benefits and disadvantages of med-arb. He talks about the Singapore and New York Conventions, his teaching at Bilkent University in Ankara and his contribution towards the special relationship between Turkey and Switzerland. He talks fondly about wanting to grow and support the international arbitration community at large and how supporting students to gain experience abroad is so important. We learn how what started as a small arbitration community has now grown into a generation of young experienced arbitration lawyers in Turkey and may continue to keep growing.


I.E: Hello and welcome to We Can Find a Way, a podcast about conflict resolution. My name is Idil Elveris. In this second program of We Can Find a Way, I spoke with arbitrator Paolo Michele Patochhi. In the Turkish version of the podcast, this interview concludes the arbitration series that I covered in three separate programs. In the first one, two attorneys explained how the judiciary’s, the public sector’s and the business world’s perspective towards arbitration changed in Turkey in the last 20 years. In the second, two academics involved in the institutional setup of arbitration internationally and nationally explained how Istanbul could become an arbitration centre and how to increase the number of women arbitrators. In this program, Michele will share the perspective of an arbitrator and counsel, of course, as he is an insider of Turkey now, he will also share his views on the development of arbitration in Turkey.

Michele is a Swiss-educated lawyer and partner at his firm in Geneva. He is very much known in arbitration circles and had acted as sole arbitrator or as president of panel in so many ad hoc; ICC; Chambers of commerce; UNCITRAL and ICSID arbitrations. When it comes to ICC, he served 99 times as an arbitrator and 35 times as counsel. He served mostly in arbitrations where Swiss towns were involved but also in Seoul, Bucharest and Milan. As a true Swiss ,he speaks and writes awards in many languages. He has written books, commentaries, law reports, papers and taught since 2013, lucky for us at Bilkent University in Ankara. His areas of specialization is wide and ranges from competition to construction, and energy to pharmaceuticals. We conducted this interview during the Corona days during lockdown via Skype on 23 April 2020.

Michele thanks for agreeing to talk to me for a podcast interview first of all.

P.M.P: Well, you’re welcome, it’s a pleasure.

I.E: All right. What is the difference between acting as a dispute resolver or as an arbitrator, as you do most of the time, and a dispute handling professional as counsel?

P.M.P: Well, there is a huge difference, and these are almost two different job activities that are not mutually exclusive, I think, fundamentally different. The arbitrator has a duty to resolve a dispute in accordance with law, and you will have to act fairly and efficiently and always to make your decisions after hearing all the parties, and you have to be impartial and independent. But we, as arbitrators, are generally appointed by a party, and so there is this private element. That is the fundamental distinction, because arbitration is a private method for the resolution of disputes. You are appointed by a party or by the other two arbitrators and yet, you must decide a dispute in accordance with law and you are independent of the parties. Your loyalty, in a way, is not to a party but to a process, despite the fact that you may have been appointed by a party, and therefore, this process must lead to a just decision, and the decision is just because it is in accordance with the contract and the law.

What I would say, based on practical experience, a decision is just because it has a sound basis in the evidence, and so you may take, in a way, travel as an analogy, and arbitration proceedings are like a journey, and this means that, if you are the arbitrator, only the means are determined in advance. You will know whether you travel by air, by boat or by car and the arbitrator knows that he or she will have to deal with the procedure, contract, the law, and must leave the parties a fair opportunity to present their case, and the arbitrator must be impartial and independent. And those are the means for the journey. But there is no destination. The arbitrator will go where the evidence of the case and the parties’ cases bring him or her, and the arbitrator may have to travel north or south, east or west, and the arbitrator will finally decide a claimant’s case is sound and make an award for the claimant in whole or in part and award damages or declare that a contract was lawfully terminated. The arbitrator may also decide that the respondent’s counterclaim is sound and make an award also for the respondent. So both parties may, in this example, win or may win something. The arbitrator may also have to dismiss the claim in other cases and dismiss a counterclaim, and he or she may have to dismiss the claims made by both parties. So the destination is never predetermined.

The arbitrator must in a way find out for himself and for herself what the true and the right decision is. But the arbitrator will be aware of the fact that the outcome of his decision or her decision may possibly please a party and displease another. But the arbitrator must be indifferent to that as long as all the parties have had a fair opportunity to present their case. The outcome, the decision, may possibly displease everyone. The arbitrator will have dismissed the claimant’s claims and the respondent’s counterclaims, but the arbitrator must still be indifferent to that. Always, provided that the parties have been treated fairly, you must be able to decide a dispute without really having concerns about future appointments. You must accept that the dispute can also be decided against a party that has appointed you. And if, deep down in your soul, you are a pleaser, you should not be an arbitrator. And I think that there is nothing more unsettling to the parties than to see from the first procedural decisions that actually there is no clear-cut decision or there is no discernible, in a way, rationale but each decision is about pleasing one party and the other. This may well mean that the arbitrators in question who make decisions of this kind, are not the right people.

Now, what do counsel do? Well, counsel do represent their clients before the arbitrator, and so the job is entirely different, because a claimant always has an objective. A claimant wants to have a decision declaring that he was entitled to terminate the contract and he’s entitled to damages. And so, if we go back to the travel analogy, the destination is set, the client, in principle, knows what he wants and gives the lawyer instructions, and obviously, in difficult cases, these instructions are discussed. The lawyer must, in a way, make an independent analysis of the client’s position. But what you must do as a lawyer is, in a way, to reach the objective that you have determined with your client and no stone must be left unturned. You must understand the facts and gather the evidence, and sometimes persuade your client to make the evidence available to you. You have to understand your client’s conduct and present your client’s case before the arbitrator, taking into account the contract and the law.

Now, what in the public is not always clearly perceived is that you are a service provider. You must help your client. That’s why you were there, and it is therefore not for you to decide whether your client is right or wrong. That’s the arbitrator’s job. It doesn’t matter whether you like your client or you don’t. You have the privilege of choosing your own clients. But once you have a client, you have to do your utmost best to present your client’s best case to the arbitrator. And, of course, if your client may not be entirely right, you must identify the risks of failure and tell your client what the chances of success are, because in a way, lawyers, like doctors, can’t always win. Doctors occasionally do have patients who die and lawyers occasionally do have cases that can’t be won, and the evidence is often very complex. Your client often needs experts on technical matters, on the amount of the damages claimed. And so, if we go back to the analogy of the journey, this is not only a journey where there is a destination that you are striving to reach. It is, as it were, a collective journey, because you have your client; you have your client’s personnel; you have your client’s witnesses; you have your client’s experts and you must lead this group throughout the journey. It is almost like a joint venture, because each participant to the voyage must in a way provide their own contributions.

The journey analogy has some limitations for a lawyer representing a client. Arbitration proceedings, like court proceedings, are a fight, however civilized. You fight with arguments, but you still fight. Now the process is adversarial, and adversarial also means confrontational in real life. You must make sure that your client is not discouraged by that, because not all clients like that. And they may have doubts and you may lose one or more battles before you win the war, if you win it at all. And you must make sure that your client understands the difficult passages on this rather long journey that can last for years. But then counsel’s advocacy is also important because there is another important objective, which is actually showing the way to the arbitrators. I mean, your mission is not really just to engage in argument with the other side. The ultimate goal is that you could in a way win the heart and the mind of the arbitrator. And your mission is to show at each opportunity that your client’s arguments are better than those of the other side, because they are supported by better evidence, because they are consistent with what both parties actually did. Your case is not something that is in a way made up after the facts. It’s something that follows what has happened and everybody can see has happened in fact, and your arguments are in accordance with the contract and the law and they are the more reasonable arguments.

If your question is about the comparison, the comparison is limited, I would say to the proposition that in both cases, an arbitrator and a lawyer both deal with facts, evidence, argument and law. It’s a lawyer’s job and in both cases, you must have a clear view of what is required in order for the dispute to be resolved, in order to make a decision if you are an arbitrator, and what you should be dealing with in order to enable the arbitrator to make a decision if you are the lawyer.

But there are fundamental differences because as counsel, you lead a group to present your case and you argue in order to win. As an arbitrator, I’m not sure what winning really means and I’m not really sure whether an arbitrator ever wins or loses. I would say even if the arbitral award were to be set aside. I mean, I think, if you win as an arbitrator, if you can continue to live with a clear conscience after the decision or the decisions you have made in your career, you must conduct the proceedings fairly and sensibly, but with a firm hand, and you decide at the end. You are not alone. Very often there are two colleagues with you and you do not have a client and you do not have an opponent. So I think, fundamentally these are different jobs, both required in order for arbitration in a way to be this very essential alternative to court litigation.

I.E: Your emphasis on procedural aspects reminded me of research conducted about courts. People’s perception of justice is not based on outcome but is based on process. Two, I think you made a comparison of the counsel as a party in a joint venture, as a leader almost, but also stressing that it’s not a position of unity with a client because you continue to be separate entities whereas an arbitrator is a decision maker. But again, a party’s lawyer has to win the heart and mind of the arbitrator. There is a winning issue but when it comes to an arbitrator, there is no such thing. If you, I guess, get continued to be appointed, you can say you have won, “won”. If you were to, for instance, act in an arbitration as a counsel, I guess you would be using your experience as an arbitrator much more than a counsel who has never acted as an arbitrator. What would you say to that? Or would you say well, if I was the arbitrator, I would have done this or I would have done that? Does it happen often to you?

P.M.P: Well, it does. One should perhaps draw a line between two very different situations. The first situation is you argue a case before an arbitrator whom you know because you have sat with her or with him beforehand. And this is obviously an invaluable service you provide to your client because if your client comes after the arbitrator has been appointed and you say, “well, I know him or her, I can tell you that this is more likely than not the way which proceedings are going to be conducted”. That is obviously a service that perhaps a number of your colleagues could provide, but not all of them. This is actually very helpful experience when you argue a case.

But then even if you have never met the arbitrator, there are actually a number of practical experience you will have gained to tell your client “look, I understand why you want to press this point but I’m telling you that this is not as helpful as you might think. It might possibly be counterproductive”. When you have sat as an arbitrator for a number of years and you see not only how yourself have reacted to irrelevant argument, but how many of your colleagues have, then I would say you almost provide statistical data based on your own personal experience to your client. And you could say “look, let’s don’t do that. This won’t fly, at best and at worst it might be counterproductive”. So there is obviously a benefit predict a number of reactions that you may perhaps not predict as easily.

Advantages go the other way around as well. I think if you are counsel often enough, can understand quite easily whether certain points are just being pressed because there are instructions, or you can feel that certain points are just being pressed because counsel wants to take some time for some grandstanding at the hearing just because the client is there. But they might not do that if the client weren’t there. And all these things in a way you spot because you have done them yourselves when you have your own clients next to you. The benefit of switching hats is a very considerable benefit.

I.E: It’s probably more fun or more beneficial to switch back and forth, to always carry one benefit from one practice to the other.

P.M.P: Yes, it may be a matter of taste. I mean, yes, there are arbitrators who at a certain age, simply have too much in order to accept cases as counsel. I mean the involvement you must have, even if you have a very competent and sufficient team behind you dealing with the cases’ counsel probably requires five times as much time as handling a case as an arbitrator. And so if at some point in your career you end up having too many cases or a fair amount of arbitrations as an arbitrator, you may have virtually no time left to represent clients and clients would hate to hear that you are sitting for one or two weeks and you can only talk to them around six o’clock in the morning or after 10 o’clock in the evening. I mean, there are practical constraints, and so even if you have a team behind you who can deal with the clients, I mean, if clients’ requirements are that they would like to talk to a senior partner with sufficient frequency, well then you are no longer able to accept such cases. I mean, that’s life and choices have to be made.

I.E: Let’s just move a little bit towards mediation. I know that these days med-arb is quite popular, increasingly inserted, as far as I’m aware, into contracts. Can you tell us what the benefits and disadvantages of these clauses are in practice, please?

P.M.P: I suppose you have a kind of mediation in mind, which is true mediation, with a mediator present, whether or not acting under the rules of some institutions, and that mediation here is something that is separate from arbitration and one is not really dealing with arbitrators switching hats, what in fact does happen in a number of civil law jurisdictions. These mediation clauses are more and more important, and one can see why. The criticism you often hear against arbitration is that it has come to be too lengthy and too complicated and too much handled by lawyers and too expensive.

I’m not sure that this criticism is warranted in all respects because life has come to be more complicated and it is unfair to compare an arbitration relating to an infrastructure project to the arbitration you may have in relation to the quality of grains, where you have an arbitrator boarding a ship and seeing the grains and saying “this is okay” or “this is not okay”. It is fair to say that the average arbitration in a complex project nowadays would take years. Against that background it might almost be difficult, if not impossible, to see disadvantages in having a clause requiring the parties to have a first step in mediation. The only practical illegal difficulty I see is that if you have to sue in order to make sure that your clients’ claims are not barred by limitation, but short of that, if the choice is between having an arbitration which may last for years, particularly in cases where the outcome is far from predictable and there aren’t many cases in real life where the outcome is really very predictable then mediation seems to me to make a lot of sense. Because it might take months and the prospect is that in the best scenario you end up having a settlement and in the worst scenario, you might end up having wasted two or three months.

Then, on the lawyer’s involvement you will have far lower fees. I see advantages. I’m not sure whether there is any statistical data on whether it is more likely for a party to obtain payment voluntarily pursuant to a settlement agreement made in mediation rather than pursuant to an award but mediation is likely to be more friendly or less unfriendly than arbitration proceedings. And, insofar as the relationship between the parties may have been preserved, one may imagine that it might be easier for a party to obtain payment pursuant to a settlement agreement rather than an award, although it is fair to say that a number of arbitrations I’ve been involved in, regarded a failure to pay by a party pursuant to a settlement agreement. So the fact that there is a settlement agreement, doesn’t always mean that the dispute between the parties is over. But if you take into consideration these factors time and money, there would not really be a disadvantage in having a mediation, and I certainly would recommend to any clients who have signed an arbitration clause requiring mediation to comply with the mediation requirement, if only because if you don’t, you may end up losing one year with admissibility objections in the arbitration proceedings, and so it is not, in principle, inconvenient to invest, I would say, two or three months for a mediation before a competent mediator.

The other disadvantage if a party doesn’t want to pay, and that is probably a higher risk in arbitration proceedings is that, of course, there is the New York Convention, of course we all like to say that this is the most successful international treaty ever and that arbitral awards circulate and are enforced much more easily than court judgments, I mean enforcement against a party that is not willing to pay may still, in real life, take years. An example particularly Turkish lawyers may be familiar with an investment case brought by a Turkish company Sistem against the state of Kyrgyzstan back in September 2009. Under the ICSID additional facility rules and information about this is publicly available on the internet. In 2018, a number of years later, Sistem was still embroiled in US enforcement proceedings to obtain payment. This means that trying to preserve a relationship between the parties that enables a party in a way entitled to payment to obtain payment sooner rather than later is obviously important.

The only risk I see in mediation is the parties may be led to be more talkative than they would normally be due to the informal setting. There are parties that are very cautious but there are also parties that may actually be influenced by these factors. And, although there may be confidentiality duties applicable on all the participants to a mediation, once a party has given away a piece of relevant information that is out. A party may make a concession, a party may have to give explanations as to the ultimate objective that it seeks to achieve by making certain claims, and that’s why it’s very important, in my view, that the mediator should not be the arbitrator, because…

I.E: I was going to ask about that.

P.M.P: Yeah, if you have the arbitrator hearing a concession, relevant statements about the ulterior motives for the action of either party, he or she won’t forget it. You can never know to which extent the arbitrator will be able to remove certain information from his or her mind when making a decision, and so I have never been favourable to the kind of mediation whereby arbitrators in a way stay proceedings and start acting as mediators. I have done this when requested, r

I.E: Right

P.M.P: Because if the parties ask you to do this and they both agree that this is what they want, well then, first of all, it’s difficult to decline and you will try to do your best. Again, this is not exactly the same type of mediation you would probably get from a professional mediator, because a mediator may actually not want to engage in legal or contractual considerations.

I.E: Or not as much.

P.M.P: Yes, whereas an arbitrator’s mediation carried out in such circumstances would inevitably be coloured by the provisional views that the arbitrator may have on the party’s respective positions. And so if the arbitrator were to propose a settlement, then it may well be that the terms of the settlement might not be entirely dissimilar from the content of an award, particularly if this exercise is performed rather late in the arbitration.

I.E: Thanks for actually mentioning the rate of compliance, because we know actually from research that the rate of compliance in mediation is one of the highest if you compare it with litigation. It can’t be the full picture, otherwise we wouldn’t have needed the Singapore Convention. So, do you think the Convention has the potential to become as successful as the New York Convention?

P.M.P: The New York Convention addressed a real need. What is perhaps less known is that there have been individuals, particularly at UNCITRAL, that have taken it upon them to in a way, market the New York Convention very efficiently by talking to lawyers in charge, ministries of law, legal departments in different states to make sure that, whenever the opportunity arose, a state would actively consider the benefits of ratifying and signing, if need be, the New York Convention. You need some marketing effort if I may call it that. I’m not aware whether this is being done for the benefit of the Singapore Convention. It is perhaps naive to think that just because the Singapore Convention is said to be based on the structure and the main ideas or some fundamental ideas of the New York Convention, it will fly on its own. I don’t think this will happen. I think the personal effort will have to be put in to that effect.

I.E: You are a very busy counsel as well as an arbitrator, but you take your time every year to come to Bilkent University and teach. Please tell me why you’re doing this. If you can also give us your opinion about how ADR has developed in the last 15 years in Turkey, as well as in many dispute-rich jurisdictions that are not always known for their speedy judicial systems.

P.M.P: The invitation to teach at Bilkent came a bit as a surprise. I had the impression, rightly or wrongly, that what I considered to be a rather special relationship between our two countries, Switzerland and Turkey, was perhaps fading away. We had Turkish PhD students. I had one Turkish assistant when I was a student, and I’m not sure I see them again now, and it would be a pity if this, in a way, tradition died away. So, I embark on this experience because I believe that this relationship should be maintained and that if the opportunity arises to strengthen that relationship, we should take the opportunity, and so I took it.

I.E: Great. For eight years now right?

P.M.P: Yes, it was not just the honour of teaching in a well-known university. After stopping in Geneva for almost 20 years, I also saw that this opportunity might bring my partner in the law firm and me closer to many Turkish friends, colleagues and clients eventually. And there have been many benefits I think that we, as Swiss lawyers, should try to be a window for the students on a part of the world that they may not be entirely familiar with, at least to an extent. But in turn, these students have come to me to be a window onto a country and a whole region I had limited experience about, and Ankara and Turkey are an incredible platform, not only to get to know colleagues and people who are from Turkey, but there are a number of colleagues and other people coming to Turkey from neighbouring countries whom we would not easily meet in Switzerland. It has enabled me to see also the enormous developments that have taken place in the Turkish arbitration community over a period of 15 years, because Idil I think we first met when I came to Istanbul for the first time?

I.E: Oh yes, it was I think, 2003.

P.M.P: The landscape has completely changed. You can see more experienced arbitration lawyers, a more junior generation that has emerged in the meantime, and so these are very encouraging developments. Some of the developments in the decisions made by Turkish courts have been encouraging too, and I continue to do all I can to encourage and support the best of my students to postgraduate or gain professional experience abroad, as I believe that this is in the interest not only of the Turkish arbitration community but of the international arbitration community at large. It’s an ongoing exercise.

I.E: How did ADR develop, not only in Turkey, but in many jurisdictions like Turkey?

P.M.P: The perception that the judicial activities are slow is obviously unfortunate, I think, for the image of the country, and Turkey is of course not alone in that respect. And on the Western European jurisdictions share more or less that image. For Turkey what I really see as the downside of it is that if the perception were to improve, Turkey would certainly be an a far better position to import cases involving parties from neighbouring countries. That was clearly one of the objectives pursued with the establishment of ISTAC in Istanbul. Although arbitration tends to be regarded as a no court option, there is obviously the risk that the courts may be involved, that a party that is unwilling to play by the book or that has a legitimate interest to go to court may bring court proceedings. If these proceedings last forever, then at the end of the day this has a detrimental effect on the image that arbitration may have, and so the parties may be slow to consider that particular country as a venue for arbitration, and in that respect probably some progress has to be made.

I.E: Thank you very much for taking this time from your busy schedule. I do very much appreciate it.

P.M.P: Thank you so much for giving me this opportunity Idil. We’ll be in touch.

I.E: Just to recap the most important points made by Michele Patochhi, he explained the difference between acting as an arbitrator and counsel, especially in terms of the advantages that this dual role confers when representing a party. I also liked his emphasis on loyalty to the process which touched upon the uncomfortable situation of trying to please a party that appointed you as an arbitrator. Michele also talked about the benefits of med-arb by distinguishing between an arbitrator playing the mediator’s role upon request of the parties or an independent mediator being appointed outside of arbitration. He underlined the need to market the Singapore Convention just as the New York Convention once was. Finally, we discussed his contribution to the special relationship between Turkey and Switzerland by teaching in Ankara at Bilkent University, which is truly admirable with this schedule of his. His point about this experience helping him to understand the region better points out to the mutual benefit one gets from these interactions rather than the assumed one-sided benefit Westerners imply in this kind of relationship.

Michele also mentioned what started as a small arbitration community in Turkey now grew into a generation of young experienced arbitration lawyers. This is the theme that I heard in this arbitration series from all speakers and it makes me really hopeful about the future of arbitration in Turkey.

Well, I hope you enjoyed this program. Do let me think about your views about it at I am grateful to Alper Koç who is the sponsor of We Can Find a Way, and Can Aksoy who helps me in marketing. Thank you and see you in the next program.