Session a – the Tribunal

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Session a – the Tribunal SESSION A – THE TRIBUNAL 1 Arbitrator interviews To what extent are parties allowed to interview arbitrator candidates, and what precautions should the candidates themselves take (e.g. based on the CIArb guidelines)? 2 Due diligence on arbitrators Is there a concern about using private investigators to investigate the background and independence of proposed arbitrators? 3 Party appointed arbitrators (i) It is common for parties to nominate a lawyer from their own jurisdiction as their party appointed arbitrator. Frequently, the substantive law is also the law of that jurisdiction. Typically the other two arbitrators are from different jurisdictions. When issues of substantive law arise, is this arrangement a level playing field? (ii) To what extent is it permissible for a party to provide a list of potential tribunal chairs only to their party appointed arbitrator? If a party appointed arbitrator receives such a list, should he or she disclose it to the other party appointed arbitrator or to the other party or to both? (iii) In a typical arbitration clause, one party appoints an arbitrator first and the other party appoints another arbitrator, subject to approval by the arbitration institution where applicable. The chairperson is then appointed either by the two arbitrators or by the parties, as the arbitration clause provides. (iv) Is it common for the arbitration institution not to inform the identity of the arbitrator appointed by one party to the other party until that other party appoints another arbitrator? 4 Appointments by the institutions (i) Should institutional rules make the selection of arbitrator(s) by the institution / appointing body the default position? (ii) Where arbitral institutions are required to act as an appointing authority, should they endeavour to ensure that appointments of arbitrators on their roster list are distributed equally? 1 5 Appointment of non-lawyers The lawyers are taking over. Traditionally, we are told, one of the beauties of arbitration was that it provided a possibility for parties to have their disputes resolved within their own business or industry, without the involvement of lawyers. Certain arbitration rules (e.g. FOSFA) try to retain this option by excluding lawyers from parts of the procedure. Anecdotal evidence suggests that the appointment of non- lawyers is becoming increasingly rare. Is it? Are any delegates working on a case presided by a non- lawyer? What are the pros and cons of this route? 6 Selection of arbitrators Is expertise in a particular area of law or industry sector really a relevant factor when selecting an arbitrator? 7 Conflicts (i) Does the ability of parties to choose arbitrators encourage perceptions of bias or impartiality? (ii) There appears to be a concern about the neutrality of arbitrators who are actively recruiting global companies to be those entities' party appointed neutrals. Does this marketing approach by certain individual arbitrators conflict with the concept of real neutrality? (iii) Do people have any recent experience of making qualified disclosure when accepting an appointment because of a past or present relationship with counsel/ counsel’s firm? If Barristers’ chambers were concerned, were they treated differently to a conventional law firm? If there is any such recent experience, how did that work out for them? (iv) Does the use of social media create arbitrator conflicts of interest? (v) How far should disclosure of potential conflicts of interest go and how willing should an institution be to appoint despite some disclosure of a marginal nature? (For example: Is the fact that someone who works for a party is a LinkedIn connection of a potential arbitrator something that should be disclosed?) (vi) Shall an Arbitrator appointed upon nomination of one party be revoked where there exists a business relationship within the framework of the Board of Directors of a Company between such Arbitrator and (not the nominating party and/or the legal counsel, but) the defense technical consultant appointed by the Legal Counsel of the same party and such relationship has not been declared by the Arbitrator? Shall a possible revocation depend on the depth of the relationship and at what depth the relationship may be judged decisive for the revocation of the nomination? 2 (vii) Arbitrator X had acted as Chairperson in two different, completely unrelated arbitrations, A vs. B and C vs. D. Both arbitrations are terminated. In a third arbitration between A and C, which is totally unrelated to the two first arbitrations, A wishes to appoint X as co-arbitrator. Does X have to disclose • to A that he/she acted as Chairperson in the case between C vs. D; • to C that he/she acted as Chairperson in the case between A vs. B? 8 Challenges (a) When challenging arbitrators, the general criterion would be whether justifiable doubts exist as to the arbitrator's impartiality or independence. In discerning whether justifiable doubts exist, should the test be "sheer appearance of bias" or "actual bias"? In other words, should the test be a "subjective" or "objective" one? (b) In challenging arbitrators, does non-disclosure of certain facts qualify as an ipso facto or ipso jure ground for a successful challenge irrespective of the nature and impact of the non-disclosed information, or should the non-disclosed information strongly suggest and evince bias? (c) Challenging arbitrators is often a fact sensitive and fact assessment exercise, but what law governs such exercise to discern an arbitrator's bias? Is it the lex loci arbitri, the lex causae, the law governing the arbitrator's capacity (lex patriae or lex domicilii), or the law governing the arbitration agreement, the lex loci executionis, or a different law? 9 Emergency arbitrators (i) Does emergency arbitration provide sufficient procedural safeguards for the Respondent? (ii) Many institutional arbitration rules provide for opt out emergency arbitrators (eg SCC since January 2010, SIAC since July 2010, ACICA since August 2011, ICC since January 2012 and Swiss Chambers since June 2012), the AAA international and commercial arbitration rules foresee the opt in emergency arbitrator since 2006/2009. Does the LCIA offer the same or even better service with its expedited tribunal formation and the possibility to curtail time limits according to Article 9 of the LCIA Arbitration Rules? (iii) Parties seek to put pressure on each other especially in the period prior to the commencement of arbitral proceedings. A potential respondent may start state court proceedings or seek to obtain a court order enjoining the other party from commencing arbitral proceedings (“anti-arbitration injunction”). Such manoeuvres lead to an escalation of the dispute, increase the costs and divert the parties’ attention from the main issue. 3 Pursuant to Article 29(1) of the 2012 ICC Arbitration Rules, a party “that needs urgent interim or conservatory measures that cannot await the constitution of an arbitral tribunal” can seek interim or conservatory measures from the Emergency Arbitrator. Can the Emergency Arbitrator play a useful role in fighting anti-arbitration injunctions by issuing anti-suit injunctions? 10 New counsel Once the tribunal is constituted, should there be a requirement on the parties to disclose the addition of any new counsel? 11 Removing counsel Can there really be a possibility for arbitral tribunals to remove counsel? 12 Tribunals' powers Do tribunals have the powers they need to deal with process abuses and are they using them? If not, how do they get them? 13 Arbitrators’ fees (i) There is increasing anecdotal evidence of arbitrators providing time sheets which indicate they have spent a disproportionate amount of time on a case compared with their co-arbitrators. LCIA caps the hourly rate but can anything be done by arbitrators or institutions about arbitrators who spend (or say they spend) an excessive amount of time on a case? (ii) Is proceeding through an institution a good way of bargaining down arbitrators’ fees? Does it work out cheaper having a top silk appointed by the ICC or appointed ad hoc? Or is there insufficient price transparency for parties or counsel to make any judgment as to how to control this element of fees? (iii) Many institutions that, unlike the LCIA, calculate the tribunal's fees on the basis of the amount in dispute still practise the 40:30:30 fee split. When chairing, I thus discuss the topic openly with my co-chairs at the outset and ask them whether they want to go with the mentioned split and allocate the workload accordingly or whether they want the chair to do most of the work and agree on a different fee allocation that reflects this. I am fine to go both ways. Unfortunately, in two recent cases, co-arbitrators opted for the 40:30:30 split while agreeing to split the work accordingly but were each time "unavailable due to other commitments" when work needed to be done. An hourly fee would avoid this problem, although I see that this makes the cost of the case less foreseeable for the parties. Have you experienced situations like mine? How would you react? 4 (iv) Should there be standard conditions for cancellation or postponement fees (e.g. sliding scale depending on time of notice) payable to the Arbitration Tribunal? If so, should they be mandatory or in the nature of suggestions? Should the payment of such fees be subject to conditions, such as the attempt to replace the scheduled hearing with other remunerated services? 14 Secretaries to the tribunal The ICC's "Note on
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