Chartered Institute of Arbitrators

Module 1: Domestic Arbitration

Law, Practice and Procedure – Revision Notes

Chapter 1: An Introduction to ADR

Dispute resolution processes
• Dispute resolution processes for commercial disputes:
• Alternative Dispute Resolution (ADR)
– Advantages of ADR
– The processes and main differences
– Court litigation
Different forms of ADR
• Certification
• Executive negotiations
• Early neutral evaluation
• Private (mini) trial
• Expert determination
• Dispute Boards
• Mediation
• Med-Arb
• Adjudication
• Arb-Med
• Arbitration

Processes with direct involvement of and most control by parties:

• Executive negotiation
• Mediation

Third party neutral

• Minimal requirements of due process:
– Certification
– Early neutral evaluation
– Expert determination
– Dispute review boards

Process-driven forms of ADR:

– Private (mini) trial
– Dispute adjudication boards
– Adjudication
– Med-Arb
– Arbitration
Dispute resolution clauses

Multi tiered dispute resolution clauses:

– Separate dispute resolution procedures at different stages
– Distinct and escalating stages
Different stages engage different personnel and expertise

Multi-tiered clause – concept

• If there is a dispute between the parties, the parties agree to refer dispute to
senior executives for settlement
• If dispute not settled within a specified period, then refer dispute to
mediation
• If dispute does not settle at mediation, then parties shall refer dispute to
arbitration (or litigate)

Example

Standard form example

– The dispute is referred to a Dispute Adjudication Board (DAB) which
then provides a decision
– Amicable settlement (after notice of dissatisfaction with DAB’s
decision)
– Arbitration (final settlement by international arbitration)
• (Clause 20 of the FIDIC Red, Yellow, Silver and Gold Books)

Chapter 2: History of Arbitration

Brief history
• Plato, The Laws:
– “Contracts: If a man fails to fulfil an agreed contract … an action should be
brought in the tribal courts if the parties have not previously been able to
reconcile their differences before arbitrators” (their neighbours, that is)
• Common Law of E&W:
– Evident from reports that arbitration reference was in common use

• Arbitration Act 1698 (England)

– “Whereas it hath been found by experience, that references made by Rule of
Court have contributed much to the ease of the subject, in the determination
of controversies, because the parties become thereby obliged to submit the
award of arbitrators … now, for … rendering the award of arbitrators more
effectual be it enacted.”
• Lex Mercatoria
– special form of dispute resolution, recognised in Europe
– for merchants and international traders travelling between the markets in
Europe
– based on custom and practices of the merchants
– allowing for swift justice
– The French Revolution (Napoleonic Code)
– Declaration that arbitration was the ‘most reasonable means of determining
disputes between citizens’

• Common Law Procedure Act 1854 (E&W and much of the British Commonwealth)
– great revision of the law of arbitration
– gave express recognition to arbitration as an alternative means of dispute
resolution
– court empowered to stay a court action brought in contravention of an
arbitration clause
– ICC formed in Paris in 1919
– one of a number of such organisations (many had existed in the maritime
arena) promoting arbitration

• General Protocol of Arbitration Clauses 1923

– dealt with the enforcement of agreements to arbitrate
– Convention on the Execution of Foreign Arbitral Awards 1927
– Dealt with the execution of foreign arbitral awards
– Arbitration Act 1934 (amendments to earlier Act)

• New York Convention for the Recognition and Enforcement of Foreign Arbitral
Awards 1958 (the New York Convention) (NYC)
– deals with the recognition and enforcement of arbitration agreements and
foreign arbitral awards
– single most important development in international arbitration
– UNCITRAL Model Law (1985 and amended in 2006)
– harmonisation of national laws on arbitration
– capable of being adopted as the law on international arbitration by a State

• International Arbitration Act 1974 (Cth) (Amended July 2010 to adopt 2006 amendments to the
Model Law)
– Incorporates Model Law, NY Convention and ICSID arbitration
– Convention on the Settlement of Investment Disputes between States and Nationals of Other
States (the Washington Convention) - Australia became a signatory in 1975 but entry into
force of Convention in 1991
– Deals with the settlement of disputes between foreign investors and a home state
Components of Commercial Arbitration

Typical components

• Arbitration agreement
• Party autonomy
• Arbitration rules
• Arbitration laws
• ‘Seat’ of the arbitration
• Private hearings
• Award
• Enforcement under the New York Convention 1958

Arbitration agreement

• An agreement between parties that provides for all disputes to be submitted to

arbitration
• It can be included as a clause in a main contract or as a separate agreement:
– ‘Any dispute or controversy or claim arising out of, relating to or in connection
with this contract, including any question regarding its existence, validity or
termination, shall be resolved by arbitration in accordance with the ACICA
Arbitration Rules. The seat of the arbitration shall be Sydney, Australia [or
choose another city]. The language of the arbitration shall be English [or choose
another language]. The number of arbitrators shall be one [or three, or delete this sentence
and rely on Article 8 of the ACICA Arbitration Rules.’

Party autonomy

• The freedom of parties to make decisions concerning their relationship

constrained only by mandatory laws.
• This can include:
– Choice of dispute resolution process (jurisdiction clause)
– Choice of law for determining the merits of the dispute (governing law
clause)
– Law applicable to the arbitration agreement
– Law applicable to the arbitration (seat)
– Institutional arbitration rules to apply to procedural and administrative
aspects of an arbitration

Arbitration rules
 • Many specialist arbitration institutions have developed rules of procedure for the
conduct of arbitrations
• These rules generally contemplate that any such arbitration will be administered
by the arbitration institution
• Arbitration institutions:
– ACICA (Australia)
– CIETAC (China)
– HKIAC (Hong Kong)
– ICC (Paris)
– KCAB (South Korea)
– KLRCA (Malaysia)
– LCIA (London), and
– SIAC (Singapore)

Arbitration laws

• Arbitration laws of a particular jurisdiction can be nominated as the law applicable

to the arbitration (seat of the arbitration/award)
• Examples of arbitration laws:
– International Arbitration Act 1974 (Cth)
– Arbitration Ordinance, Cap 609 (HK)
– Arbitration Law of the PRC
– International Arbitration Act (Singapore)
– Arbitration Act 2005 (Malaysia)
– Arbitration Act (RoK)
– Arbitration Act 1996 (England & Wales)

Seat of the arbitration

• Nominated by the parties – if not then needs to be determined by the arbitral

tribunal
• Procedural law the most crucial dimension in an international arbitration since it
gives the award an anchor or juridical home from which most matters are
assessed. (Akin to an exclusive jurisdiction clause)
• Also known as lex arbitri, the ‘curial law’ of the arbitration or the ‘procedural law’
• Not to be confused with governing law of the contract (contract law, tort etc)

Privacy

• Implied term
 • Some arbitration rules do state that, unless the parties agree otherwise, the
arbitration is private: only parties, legal representatives, witnesses or other people
concerned with the arbitration are permitted into the hearing room
• Corollary is confidentiality – needs to be expressly stated since inconsistent
decisions around the world about its status as an implied term

Award
• At the end of the arbitration process the tribunal makes an award which
determines all the issues between the parties.
• The award is said to have been ‘made at the seat ‘
• Only available to the parties, not made public (except for ICSID Awards)
• May be enforced in the same way as a judgment

Enforcement

• Enforcement of awards can be far easier than the enforcement of judgments

• Can enforce anywhere the respondent holds assets
• Enforcement should not be any more onerous than it is for a domestic party
• NY Convention sets out the grounds for refusing to enforce and award (Article V)
• 150 signatories to the NY Convention

‘International’

• Requires there to be an international context:

• Nature of dispute:
– If it involves the interest of international trade
– Subject matter of contract
– Place of performance
• Parties
– Parties from different states (physically or legally)
• Not ‘domestic’

‘Commercial’

• contracts made between traders or merchants

• contracts giving rise to business relationships
• contracts relating to commercial matters
• Model Law – gives ‘commercial’ a wide interpretation
• The NY Convention – contracts considered as commercial under a state’s national
laws

Chapter 3: The Arbitration Act 4 of 1995

Learning Objectives
 • Background to and purpose of Arbitration Act 1995
• Principles underpinning the Act
• The scope of the Act
• Differences between mandatory and non-mandatory provisions
• Features of the Act & implications for arbitrators

Why the Act was needed

• repeals and re-enacts with amendments the Arbitration Act and to provide for
connected purposes;
• Promote arbitration with pro-arbitration provisions
Purpose:
• Intended to make the process of arbitration (domestic & international) clear

General principles – Section 1

• How arbitrations are to be conducted = fair resolution of disputes by impartial
decision maker without unnecessary delay or expense
• Mandatory & non-mandatory sections = to protect public interest but retain party
autonomy (s3(5) &(6)
• Court’s right to intervene limited to what is provided in Act (s.10)

Mandatory & non-mandatory provisions

• Mandatory = provisions which cannot be altered (usually giving court a specific
power or requiring a state of affairs)
– ‘The tribunal shall…’ s.29(1)
– ‘The parties shall …’ s.19
• Non-Mandatory = provisions which can be altered (or displaced) by agreement of
parties
– ‘The parties are free to determine …’ s.11(1)
– ‘subject to any agreement to the contrary …’ s.25(1)
– ‘unless the parties agree otherwise …’ s.16(3)
• Mandatory provisions – must be complied with
• Non-Mandatory provisions may be altered by agreement. If parties do not provide
for a particular scenario, then the Act will apply

General Outline of Act

Introductory Sections:
• Part I – Preliminary (ss.1-3)
 • Part II – General Provisions (ss.4-10)
• Part III – Composition and Jurisdiction of Arbitral Tribunal (ss.11-18)
• Part IV – Conduct of Arbitral Proceedings (ss.19-28)
• Part V – Arbitral Award and Termination of Arbitral Proceedings (ss.29-34)
• Part VI – Recourse to High Court against Arbitral Award (s.35)
• Part VII – Recognition and Enforcement of Awards (ss.36-37)
• Part VIII – Miscellaneous Provisions (ss.38-42)

• Arbitration Agreement: s.4

• Stay of Legal proceedings: s.6
• Commencement of arbitral proceedings: s.22
• Appointment of tribunal: ss.12-16A
• Immunity of tribunal: s.16B
• Jurisdiction of the arbitral tribunal: s.17
• The arbitral proceedings: ss.19-28

Role of court
• Supervisory not interventionist (s.10)
• Appeal to court - by agreement (s.39):
– Question of law
• Court can deal with certain applications:
– Appointment of tribunal
– Jurisdiction of tribunal
– Appeal

Chapter 4: Choices Available to the Parties

Introduction

• Implications of party autonomy in arbitration

• Different types of law which may apply in an arbitration
• Nature and use of arbitration rules

Party autonomy

• The freedom of parties to make decisions concerning their relationship

constrained only by mandatory laws
• Relevantly, this can include:
– Choice of dispute resolution process (jurisdiction clause)
 – Choice of law for determining the merits of the dispute (governing law
clause)
– Institutional arbitration rules to apply to procedural and administrative
aspects of an arbitration

Concepts and choices

• Agreement of parties to refer disputes to arbitration = arbitration agreement (can

incorporate Rules and Laws)
• Importance of the Laws
• Importance of the Rules
• Seat (in international arbitration)

Jurisdiction

• Jurisdiction clauses – the forum in which the dispute between the parties is to be
determined
– can be exclusive or non-exclusive
– Exclusive jurisdiction clauses
– confer jurisdiction on a court to determine:
• disputes that may arise between the parties (also excluding the
possibility of arbitration), or
• those disputes which fall outside the scope of the arbitration
agreement
– Sometimes, confer only jurisdiction on arbitration but cannot exclude the
supervisory role of the courts

Governing law
• Laws that apply to the arbitral process (the ‘Applicable Laws’)
• Substantive Law (or Governing Law) nominated by the parties
– applies to the determination of the merits of the dispute or the substance
of the dispute:
• section 46 Arbitration Act 1996 (E&W)
• Model Law Art 28
• UNCITRAL Arbitration Rules Art 35
• Determines:
– Rights and duties of the parties
– Substantive remedies
– Burden of proof
– Kinds of available damages (compensatory, punitive)
– Scope of damages (quantum, proportionality)

Seat as concept
• Procedural law is usually the ‘seat’ of the arbitration since arbitration cannot ‘take
place in some kind of transnational void’
 • Therefore, in order to be successful, [international] commercial arbitration
depends for its full effectiveness upon the support of different systems of law, in
particular, the seat of the arbitration
• Parties have a choice in their nomination of the legal system that will apply to the
arbitration (this is the seat, not substantive law)

Law of the Seat

• Law of the Seat - Arbitration Law of the State nominated by parties (arbitration
law) – must be applied to the procedure by which the arbitration is conducted and
is the juridical base of the award
– Sections 2(1) and 3 Arbitration Act 1996 (E&W)
– Model Law Art 20
– LCIA Art 16
– UNCITRAL Arbitration Rules Art 18

Arbitration rules

• Arbitration rules
– can be nominated by the parties;
– the rules become a part of the parties’ agreement and provide a framework
by which the arbitration can be conducted;
– Cannot ‘trump’ mandatory laws of the seat
– Can be subjugated to an alternative agreement of the parties
– Contractual in nature - NOT law
– UNCITRAL Arbitration Rules
– Section I: Introductory rules
– Section II: Composition of the tribunal
– Section III: Arbitral proceedings
– Section IV: The award

Which law or rule applies?

• In ascertaining the arbitral tribunal’s power:

– go to the law of the seat
– consider if the relevant section in the legislation is mandatory or non-
mandatory
– If mandatory, then MUST be followed regardless of what the rules provide
(ie. the parties cannot contract out of that provision by agreeing to
something else)
• If non-mandatory (usually prefaced by ‘unless the parties agree otherwise’ or
words to that effect), then parties can choose what they do (can otherwise agree)
• Section 4 Arbitration Act 1996 (E&W)
Chapter 5: The Arbitration Agreement and Commencement

Introduction

• Ways in which an arbitration agreement can come into existence

• Elements necessary for a valid arbitration agreement
• Importance of proper notice and how it may be given
• Commencement of an arbitration

Commencement of Arbitration

DEPENDS ON
 Existence of a valid arbitration clause
 Existence of a dispute
 The dispute falls within the scope of the arbitration clause
 Pre-conditions to arbitration have been met
 Time limits
 Procedures for commencement properly identified

What is an arbitration agreement?

Arbitration is a "creature of agreement"

Not defined, except for form and:

Any reference in a contract to a document containing an arbitration clause constitutes an
arbitration agreement if such contact is in writing and the reference is such as to make that
clause part of the contract.

An agreement between parties, in a defined legal relationship, to submit an existing or

future dispute to arbitration

Significance of Arbitration Agreement

• With a valid arbitration agreement, parties will be compelled to resolve the dispute
outside the court system
• A party that takes the dispute to the court despite an agreement can be
successfully opposed by the other party, and have the court proceedings stayed in
favour of arbitration
Existence of a valid Arbitration Agreement
• In writing: s.1(1)
• A defined legal relationship: contract or tort
• Capacity to enter into an agreement
• Subject matter capable of settlement by arbitration – ARBITRABILITY
• Arbitrability of a dispute involves determining whether it may be resolved by
arbitration or whether it belongs exclusively to the domain of the courts.

Arbitrability

Rationale – Some types of disputes which affect the consciousness of the general public
are reserved only for the determination of national courts where the proceedings are not
private.

The courts have exclusive jurisdiction over such matters designated by the government,
and they are not capable of settlement by arbitration.

“The legislators and courts in each country must balance the domestic importance of
reserving matters of public interest to the courts against the more general public
interest in promoting trade and commerce and the settlement of disputes.”

Public Policy

Issues of public policy – Whether or not a particular type of dispute is “arbitrable” under
any given law is essentially a matter of public policy for that law to determine. Public
policy, by its very nature, varies from country to country and from time to time.
In determining such issues, regard must be had to:
• the law governing the party involved where the State or a State entity is a party,
• the law governing the arbitration agreement

II. Existence of a Dispute

Once the existence of a valid arbitration agreement has been confirmed, the next step in
commencing an arbitral process is to define the “dispute” between the parties.

There needs to be a dispute or difference for there to be a reference to arbitration. The

process contemplates that the arbitral tribunal will make a decision upon a dispute or
difference which is already formulated at the time the arbitral tribunal is appointed.
Is there a “Dispute”?

Channel Tunnel Group v Balfour Beatty Construction Ltd

(1993) 2 WLR 262
“… but I would endorse the powerful warnings against encroachment on the parties’
agreements to have their contractual differences decided by their chosen tribunal, and on
international policy exemplified in the English legislation that this consent should be
honoured by the courts …”
• Broad interpretation of “dispute”
• No assessment of substantive merits

III. Scope of the Arbitration Agreement

The terms of the arbitration agreement entered into are to be critically examined in order
to determine whether they are wide enough to encompass the particular claim that has
arisen.
The most comprehensive forms of wording are those which refer “all” or “any” disputes
for determination by the arbitral tribunal. The following terms are often used
interchangeably to denote a dispute: “differences, disputes or claims”.

Scope of the Arbitration Agreement

An arbitration agreement referring to “any dispute or difference” was found wide

enough to take in the effects of exceptional “dislocation” and delay…Once the parties
had clearly agreed to differ about those issues, they fell within the arbitration clause.

Validity – doctrine of separability

Separability
• Arbitration agreement is separate contract from the main contract: s.12(2)
• independent and distinct
• validity of arbitration clause not bound to main contract (but: (-) if contract never
came to existence?)
• protects integrity of the agreement to arbitrate
• Ultimately concerns the jurisdiction of arbitral tribunal
• Fiona Trust & Holding Corporation v. Yuri Privalov [2007] UKHL 40
– It was alleged that the contract containing the arbitration clause was void
because it was procured by bribery.
 – Lord Hoffmann noted: “the principle of separability enacted in [the UK
Arbitration Act] means that the invalidity or rescission of the main contract
does not necessarily entail the invalidity of the arbitration agreement. The
arbitration agreement must be treated as a distinct agreement and can be
void or voidable only on grounds which relate directly to the arbitration
agreement.”
– There was some evidence of bribery in relation to the underlying contract,
but not specifically the arbitration agreement.
– Two principles confirmed by HoL in the Fiona Trust case:
• Arbitration clauses should be interpreted liberally
• Existence of arbitration clause only invalidated if directed against the
clause itself
IV. Pre-conditions to Arbitration

Multi-tiered arbitration clauses / escalation clauses:

The rationale behind these clauses is that it “prevents parties from jumping straight
into arbitration and forces parties to engage in a non-adversarial setting to maintain and
preserve their business relationship. If successful, this results in substantial savings of time
and costs.”

V. Time Limits

• It may be provided by law or by contract

• Difference between both:
-- statutory time limit prevails over contractual time limit in the event of conflict
between both
-- contractual time limit may be dispensed with on grounds of public policy

 Effects of time limit

- with respect to statutory time limit, it bars the right of action
- with respect to contractual time limit, it could bar the claim
or right of action or both depending on its wordings
 Time starts running from the date the cause of action arose

VI. Procedures for Commencement

Commencement is a procedural matter.

The procedure to be adopted by the party intending to initiate arbitration flows from the
arbitration agreement.
The arbitration agreement may provide for ad hoc arbitration without referral to any
specific institutional rules, for UNCITRAL Arbitration Rules to be applicable, or may also
provide for the rules of an institution.

In all cases, the commencement procedure derived from the agreement of the parties is
required to be followed.

Notice of Arbitration

A written demand or notice by a party to arbitration requesting the other that:

a. their dispute within the agreement be referred to
arbitration:
b. it appoints its own arbitrator or concur in the appointment of the arbitrator nominated
or appointed by it, the party giving the notice
Date of Commencement of Arbitration:
- depends on the parties’ agreement
- where there is no agreement, it depends on the rule or law governing the arbitration
Under Article 3(2) UNCITRAL Arbitration Rules, it is commenced
-- on the date the notice is received by the Respondent.

• No fixed form
• Parties are free to choose the form
• Where there is no agreement, it is determined by the applicable rules or law
• It may however include the following
- a demand that the dispute be referred to arbitration;
- the names and addresses of the parties
- a reference to the arbitration clause or the separate arbitration agreement that is
invoked
- a reference to the contract out of which the dispute arose
- the general nature of the claim and an indication of the amount involved, if any the
relief or remedy sought

Valid Notice of Arbitration

A notice must be valid, if not, then:

a. Any arbitration commenced through it will be incompetent
 b. It constitutes a ground for stopping the arbitration
c. It becomes a ground for challenging any award rendered therein
 When is a notice invalid?
 if it is vague or improperly issued
 if it refers to a future rather than a present dispute
 if it is contrary to the parties’ agreement or the rule or law that governs the
arbitration
 if it is issued without complying with a condition precedent

Invalid Notice of Arbitration

Effect of invalid notice

o no jurisdiction to entertain the action
o Any objection must be raised on time before taking fresh step
o Objection to invalid notice:
o it may result in the claim being struck out
o under some institutional rules, the claimant may be allowed to correct the
error

Enforcement of the Arbitration Agreement by the Court

ss.4 (Stay of legal proceedings):

“court before which an action which is the subject of an arbitration agreement is brought
shall, … order or stay of proceedings and refer the parties to arbitration” (s.4(1))
“If any party to an arbitration agreement commences any action in any court with
respect to any matter which is the subject of an arbitration agreement any party to the
arbitration agreement may … apply to the court to stay the proceedings.” (s.5(1))

s.5 (Stay of legal proceedings):

• Stay to be ordered if court satisfied that:
• No sufficient reason why matter should not be referred to arbitration (sic);
and
• Applicant ready and willing to do all things necessary to the proper conduct
of the arbitration
[NB: this last ground repealed in legislation in other jurisdictions]
Chapter 6: Appointing an Arbitrator

Topic Overview
 1. Introduction – Appointment of Arbitrators
2. Appointment Process – Ad Hoc & Institutional
3. Qualification of Arbitrators
4. Considerations for Appointment
5. Challenging the Appointment – What can you do?

Introduction

• Appointment of arbitrators – a distinguishing feature from the litigation process.

• Parties to arbitration are free to choose the composition of their tribunal.
• This tribunal will preside over proceedings and will decide on the final outcome.

Introduction – Appointments

• Generally, an arbitral tribunal comprises one sole arbitrator or three arbitrators.

o One arbitrator – if parties cannot agree, arbitrator is chosen by institutional
arbitration body.
o Three arbitrators – each party nominates an arbitrator. Third arbitrator
chosen by party-nominated arbitrator or by institutional arbitration body.
o Default rule in s.6: 3

The number of arbitrators may depend on, but are not limited to:
o Amount in dispute;
o Parties’ need for a speedy resolution;
o Complexity of the dispute;
o Expertise of the tribunal; and
o Necessity for a three-person tribunal.

Appointment - Ad-Hoc

• UNCITRAL Arbitration Rules 2013 – [Article 8 & 9] Party autonomy. In lieu of

agreement between parties, reference to arbitral institute to appoint.

Appointment – Institutional
• ICC Rules 2017, Article 12 & 13 Party nominates, Institute appoints.
• LCIA Rules 2014, Article 5, party nominates, institution appoints

Qualification of Arbitrators
 • Arbitrator does not require formal legal training.
• Legally trained persons are suitable for jurisdictional, contractual and evidential
issues.
• Arbitrators with specialist or technical knowledge are suitable for industry-
sensitive facts, industry specific customs, terminology, standard forms and applied
knowledge.
• Court will consider qualifications (s.7(5)

Considerations for Appointment

• Independence and Impartiality:
o UNCITRAL Arbitration Rules 2013 [Article 6(7)] Appointing authority to have
regard to independence and impartiality;
o “Independence” and “Impartiality” not defined, case-by-case basis
• Independence and Impartiality:
o Veritas Shipping Ltd v Anglo-Canadian Cement Ltd [1966] 1 Lloyds Rep. 76;
o Americo Life Inc v Myer [2014] WL 2789429 (Tex);
o Stephen Bond, former Secretary General of ICC, The International
Arbitrator – “objective” and “subjective” neutrality;
o IBA Guidelines on Conflict of Interest – Red, Orange and Green Lists
• Other Forms of Bias and Need for Disclosure:
o Arbitrator and Third Party Financing;
o Arbitrator with substantial business relationship with another party;
o Arbitrator has previously expressed an opinion on same subject matter;
o IBA Guidelines on Conflict of Interest – Arbitrator to disclose familial or
close ties with another party;
o Schimitz (above) – Arbitrator involved as counsel for one party in another
matter.
Appointment

Responding to an invitation to act as arbitrator – check:

• conflicts of interest (will need to make disclosure);
• you have the time;
• Requisite technical or legal expertise?
• form of tribunal (sole or 3)

Interview
• NO discussion on merits of case
 • Record it if possible, have a witness present
• Keep it formal
• Limit discussion to:
– Identity of parties;
– General nature of case;
– Questions regarding suitability and availability

Contract with arbitrator

Institutional = if no terms agreed fall back on schedule of fees in rules

Ad hoc = will need to agree Terms of appointment:
• Fees;
• Cancellation charges;
• Disbursements;
• Tax;
• Interim payments;
• Security for payment of fees

Chapter 7: The Arbitrator Tribunal: Independence and Impartiality

Neutrality

• ARBITRATORS must be open minded, aware of cultural issues and without any
prejudices or misconceptions
• NEUTRALITY:
– Used to encompass INDEPENDENCE and IMPARTIALITY;
– enhanced by nationality – If nationality is different from that of the parties,
it may be assumed that they will have greater freedom of judgment;
– implies a subjective requirement
• However, neutral nationality is no guarantee of independence or impartiality but is
a practice that is generally followed (eg, UNCITRAL Rules Art.6.7; ICC Rules Art
13(1) and (5);LCIA Rules Art 6.1)

Chapter 7: INDEPENDENCE AND IMPARTIALITY: SIMILAR MEANING, TWO DIFFERENT

CONCEPTS

Independence: concerns a connection or relationship between the arbitrator and any of

the parties or their counsel personal, social and financial.
Objective measure – to determine relationship between arbitrator and party in question.
Key: the proximity between both.
Depends on past or current relationship with parties which can be catalogued and
verified

Impartiality concerns absence of bias or predisposition of the arbitrator towards one of

the parties.
Two common bases for bias: (i) familiarity with the dispute; (ii) prior conduct such as a
legal opinion which is contrary to one party’s interests.
Abstract measure - a state of mind that only can be proved through facts.
A mental attitude – harder to evaluate

Assessing Independence & Impartiality

• Requirement is embodied in procedural law (s.13), procedural rules and

professional guidelines (IBA Guidelines on Conflict of Interest in International
Arbitration).
• Absence of independence and impartiality will constitute a basis for challenging an
arbitrator: “circumstances exist that give rise to justifiable doubts as to his
impartiality or independence”.
• Obligation a continuing one

Standard of Independence & Impartiality

“Justifiable doubts as to independence and impartiality”

Refers to Refers to Dual Test

independence only impartiality only Independence &

Impartiality

‘Justifiable Doubts’
 • Test derives from English case law as applied to perceived bias of judges.

• It is a fundamental principle of English law that “justice should not only be done but
should manifestly and undoubtedly be seen to be done”: R v Sussex Justices, ex parte
McCarthy [1924] 1 KB 256, 259
“…doubts existing on the part of the claimant here must be ‘justifiable’ on some objective
basis. Are they reasonable doubts as tested by the standard of a fair minded, rational,
objective observer? Could that observer say, on the basis of the facts as we know them, that
the claimant has a reasonable apprehension of partiality on the part of the respondents'
arbitrator? Thus, if there is a reasonable apprehension of bias, the decision-maker should
disqualify himself.”

Duty to Disclose (ii)

• Article 12 (1) UNCITRAL Model Law: potential arbitrator must disclose any
circumstances likely to give rise to “justifiable doubts” as to that person’s
impartiality or independence. The obligation of disclosure is a continuing one.
• S.13 AA 1995
• Some arbitral institutions require declarations as to independence and impartiality
before accepting appointment. Arbitrator must consider any past or present
relationship, direct or indirect, between him and any of the parties, their related
entities, their lawyers or other representatives, whether financial, professional or
of any other kind.
• Any doubt must be resolved in favour of disclosure.

2014 IBA GUIDELINES on Conflicts of Interests in International Arbitration

• provide guidance as to when disclosure should be made, published on 28

November 2014, not a substantial departure from the Original Guidelines (2004)
• not legal provisions and do not override any applicable national law or arbitral
rules chosen by the parties;
• regarded as authoritative as they are broadly accepted by the international
community.

• Structure of the Guidelines

 General Standards and Explanatory Notes on the Standards’.
 3 lists indicating whether they warrant disclosure or disqualification of an
arbitrator: Red List, Orange List and Green List
Challenging the Appointment

Procedures for Challenge:

o Arbitration Act 1996: S.13-14
o UNCITRAL Arbitration Rules – Articles 11-13;
o UNCITRAL Model Law 2006 – Articles 12 & 13;
o ICC Rules 2013 – Article 14;

o ASM Shipping Ltd of India v. TTMI Ltd. of England [2005 EWHC]

o Party-appointed arbitrator, in a previous case was briefed by the same law
firm (as the party appointing) as a counsel for another client, where one of
the witnesses of the other party to arbitration was involved.
o The arbitrator in his role as counsel in the other case made allegations of
fraud on the witness.  
o Award set-aside as sufficient to raise real possibility of bias

o Korsnas Aktiebolag v. AB Fortum Varme (Swedish SC 2010):

 o Challenge on the grounds that in the three years preceding the current
appointment, one of the arbitrators was appointed twice before by a party
represented by the same law firm.
o Court refused to set-aside the award relying on orange list of the IBA
Guidelines which prescribed threshold of 4 appointments.

o Investors in Devas Multimedia v. India [2013 UNCITRAL]

– Orrego Vicuña was disqualified from the UNCITRAL panel hearing a claim by
Mauritian investors in Indian telecoms company Devas Multimedia,
following a challenge by India based on his views expressed in previous
cases under ICSID and his academic writings on the “essential security
interests" provision as well as the "state of necessity" defence.

NON DISCLOSURE

• ST Microelectronics NV v Credit Suisse Securities (2nd Cir, Court of Appeal - 2011)

– Challenge on grounds arbitrator failed to disclose he had previously acted as
an expert witness for customers asserting claims against financial
institutions
– Court held that its "virtually impossible to find a judge who does not have
preconceptions about the law,” and challenge rejected.

Liability of Arbitrators
• Relationship between parties and arbitrator contractual and therefore arbitrator
under obligation to follow contract terms
• S.16B AA 1995:
• Immunity of arbitrator “for anything done or omitted to be done in good faith in
the discharge or purported discharge of his functions as an arbitrator”
[compare: s.29 English Act - “unless act or omission is shown to have been in bad faith”]
Chapter 8: The Arbitral Tribunal - Jurisdiction and Powers

Introduction
• Sources of arbitrators’ jurisdiction and powers
• Principle of kompetenz-kompetenz
• Principal powers of an arbitrator
• Challenging substantive jurisdiction

Components of Arbitration

• Arbitration/submission agreement
• Party autonomy
• Arbitration rules
• Arbitration laws
• Neutral, independent and impartial
• kompetenz-kompetenz
• Privacy and confidentiality
• Award

Which law or rule applies?

• In ascertaining the arbitral tribunal’s power,
– refer to law of seat
– consider whether relevant provision is mandatory or non-mandatory
• If mandatory, then MUST be followed regardless of what the Rules provide (ie the
parties cannot contract out of that provision by agreeing to something else)
• If non-mandatory (usually prefaced by ‘unless the parties agree otherwise’ or
words to that effect) then parties can choose what they do (can otherwise agree)
• Set out in s.4 AA 1996

‘kompetenz-kompetenz’
 • The arbitral tribunal may rule on its own jurisdiction, including any objections with
respect to the existence or validity of the arbitration agreement or the scope of its
jurisdiction
– Section 30 AA 1996
– Article 16(1) Model Law

Separability (‘autonomie’)
• Seen as separate from contract
– Separability regards an arbitration clause within a contract as a separate
agreement (s.5)
• Parties’ intentions
– Presumption that the parties intend to submit all disputes, including
disputes concerning the validity of the main contract, to arbitration
• A clause in the main contract
– Where arbitration agreement is separate, ad-hoc or made after the dispute
has arisen, separability does not apply

Role of the Arbitrator

• Duty to:
– act fairly and impartially as between the parties
– give each party a reasonable opportunity to put their case and deal with
that of opponent
– adopt procedures suitable to circumstances of case
– avoid unnecessary delay or expense
– provide a fair means for the resolution of the matters to be determined, and
– produce an enforceable award

Powers of the Arbitrator

• NO ‘inherent’ power
• Sources of power:
– Arbitration Agreement
– The Act
– The Rules
– Any additional agreement of parties

Powers derived from:

• Agreement
• Rules:
 – discretion on procedure; evidence jurisdiction; inspection of property;
experts; disclosure; language; taking initiative; administer oath or
affirmation; interim relief; interest; costs and security for costs.
• Law: ss. 33-41

Additional matters
• Allow amendments
• Arbitrator can use own initiative
• Decide whether strict rules of evidence apply
• Abridge time
• Waiver of right to object (s.73 AA 1996)

Role of Party-nominated arbitrators

• Considerations for selecting a particular arbitrator by a party:

– in a different position to the presiding arbitrator
– may have had contact initial with the appointing party in an ex parte
interview
– may also have ex parte contact during the selection of the presiding
arbitrator
• International Bar Association’s ‘Ethics for International Arbitrators’ (‘IBA Ethics):
– Not binding on the parties unless adopted by agreement.
– Does not distinguish between the qualifications or standards of conduct for
party-appointed arbitrators and sole or presiding arbitrators

Challenging Jurisdiction
• ss.30-31 AA 1996
• Non-mandatory provision – eg. follow process in rules
• If no rules, then:
– No later than taking first step in proceedings
– If during proceedings, then as soon as possible after matter raised
• Arbitrator may:
– Rule on matter in award as to jurisdiction; or
– Deal with the objection in award as to merits (eg final award)

Challenge:
– Whether there is a valid arbitration agreement
 – Whether the tribunal is properly constituted
– What matters have been submitted to arbitration in accordance with the
arbitration agreement

• Party may apply to court for ruling (s.32) but only if:
– Made with agreement of all parties; OR
– Made with permission of tribunal AND
– The court is satisfied that:
• Determination likely to produce substantive savings in costs
• Application made without delay; and
• Good reason why matter should be decided by court
• Limited rights of appeal from decision of court

Chapter 9: Arbitral Tribunal: Duties and Procedural Choices

Introduction

 General Duties: Due process & natural justice

 Preliminary Conference
 Timing & Location
 Issues
 Consolidation and multi-party arbitrations
 Joinder of third parties
 Case study on joinder

General duties
• Role/duty of arbitrator (s.19 AA 1995):
– act fairly & impartially
– Opportunity to be heard
– Adopt procedures suitable to circumstances of case
-
• Powers of arbitrator – very wide BUT always check power is express;
• In relation to procedure, broad discretion in manner proceedings are conducted
conferred by law and rules

Preliminary Conference
Broad discretion on procedure
- UNCITRAL Arbitration Rules Art 17 of UNCITRAL Arbitration Rules)
 - arbitral tribunal may conduct the arbitration in the manner it
considers appropriate [s.20(2)]
Minimum standards of procedural fairness or equity
 S.19 - The parties shall be treated with equality and each party shall be given
a full opportunity of presenting his case.

Discretion
• ICC publication “Techniques for Controlling Time and Costs in Arbitration”;
• UNCITRAL “Notes on Organising Arbitral Proceedings”
• ICC Rules – Appendix IV: Case Management

Looking forward
 Setting procedural timetable;
 for filing of pleadings, if not already done – usually 30 days’ allowances;
 Failure to file pleading does not prevent arbitration from continuing;
 Issues for determination and any objections;
 Timing location

Issues to consider
• UNCITRAL Notes on Organising Arbitral Proceedings: questions to be
addressed as a non-exhaustive checklist:
• Procedural rules, language, place of arbitration, administrative
services, deposits, confidentiality, routing of information,
exchange of written submissions, defining issues, settlement
negotiations, documentary evidence, physical evidence,
witnesses, experts, hearings.
• Jurisdictional Issues/ Failure to raise jurisdictional issue – waiver
• Third Party & Joinder - Any additional interested parties who should be notified of
the arbitration or have an opportunity to participate in it?
• Bifurcation of proceedings
• Determination of the seat of the arbitration (failing agreement)
• Fees
• Conduct of hearing
• Oral / papers – different jurisdictions
• Timetable/Location/Language/Length of hearing
• Production of documents
• Redfern schedule
• Exchange of submissions
 • Witnesses and Experts
• Written or oral evidence
• Cross-examination only
• Order of witnesses
• Guideline on the use of Tribunal Appointed Experts,
Legal Advisers and Assessors (See CIArb Practice Guideline 10)

Evidence
 Evidence
 lay – disclose identity, subject matter, its relevance, time and manner of
service, form, may be questioned by other parties and arbitrator at hearing;
 expert – arbitrator can appoint (if parties have not) and parties to provide
all relevant information/documents etc;
 Documents – disclosure;
 Inspection of property or site or thing

Taking of Evidence

 Court assistance (s.28 AA 1995):

 On application of tribunal; or
 On application of a party; and
 With permission of tribunal

Multi-party Arbitrations

Procedural complexities from the multiplicity of parties – If there are various parties in
one transaction:
• can proceedings be consolidated?
• can other defendants be joined?
• can a third party intervene voluntarily?
Alter ego
• one entity domination of day-to-day actions of another
• US Courts more willing
Group of company doctrine
• benefits and duties of arbitration agreement extended
to another company in group: JJ Ryan & Sons Inc v Rhone
Poulenc Textile
 “when the charges against a parent company and its subsidiary are based on the
same facts and are inherently inseparable, a court may refer claims against the
parent to arbitration even though the parent is not formally a party to the
arbitration agreement.”

Interim orders/Measures
• Purpose of “Interim Order/Measure”:
– to protect the integrity of the dispute resolution process
– to preserve the factual or legal situation so as to safeguard the rights which
a party is seeking to have recognised by the Tribunal with regard to the
substance of the case
[ss.18 AA 1995]

What you need to demonstrate for interim orders

• Normally 5 elements need to be demonstrated (note not ‘proven’)

– Prima facie jurisdiction of the Arbitral Tribunal
– Irreparable harm (or not adequately reparable harm);
– Urgency of the matter
– Likelihood of success on the merits (need to show good/plausible overall
case or at least reasonable possibility of success on the merits) – this does
not mean pre-judging the merits of the case;
– If required by the Tribunal, appropriate security for any damage that may
result (cross indemnity)

Enforcement
Enforcement of interim measures:
• International experience – high voluntary compliance rate;
• General duty on parties to do all things necessary for the proper and expeditious
conduct of the arbitral proceedings (s.19)
• Tribunal has power to seek assistance of court in relation to interim orders (s.18(2))

Party’s default and Peremptory Orders

• If defaulting party fails to show sufficient cause:

– Tribunal may make peremptory (s.26(g) AA 1995);
• If party fails to comply with a peremptory order, Tribunal may:
– direct that the party in default shall not be entitled to rely on any allegation
or material that was the subject-matter of the order;
 – draw such adverse inferences from the noncompliance as the circumstances
justify;
– proceed to an award on the basis of such materials as have been properly
provided to it;
– make such order as it thinks fit as to the payment of costs of the arbitration
incurred as a result of the noncompliance

Procedure
• Hearings:
– At request of either party;
– Must give notice to parties (due process) – s.25
• Award Writing
• Issue award – within time if stipulated

CHAPTER 10: PROCEDURE: PLEADINGS, DOCUMENTS AND EVIDENCE

Pleadings

• Need not use pleadings at all (s.34(2)(c))

• Statement of case – the claimant’s case
• Defence – the respondent’s defence to the claim
• Counterclaim – the respondent's claim in response to the claimant’s claim
• Reply – further response to a defence

Rules of evidence

• Generally, in arbitration the ‘Rules of Evidence’ do not apply – unless the parties
choose for them to apply (s.34(2)(f)
• What are the common law concepts?
– Hearsay – oral
– Primary evidence: original document – there’s no better!
– Secondary evidence: suggests better evidence
– Audi alterem partem and Nemo sui iudex causa
– Tribunal empowered to determine (a blend of civil vs common law
principles):
– Admissibility, relevance, materiality, weight of evidence
– (IBA Rules of Evidence)

Art 16 ML (s.34(2)(f): evidence need not be admissible in law

 • Admissibility: whether evidence should be admitted – usually if relevant
• Relevance: evidence relevant to the determination of a fact in issue - existence of
any fact or consequence which renders it more or less probable than it would be
without the evidence
• Materiality: a fact is of consequence if it is material - evidence affects the outcome
of the case (merges with relevance)
• Weight of evidence: the credibility of proof offered in evidence

Proof – Burden and Standard

• Ascertaining the facts: tribunal may take initiative in ascertaining facts: s.34(2)(h)
• Onus or burden of proof:
– Who has responsibility to prove issues?
– ‘He who asserts, must prove’ – eg. claimant to prove claims
– Standard of proof:
– Balance of probability vs reasonable doubt

Evidence Generally

• The ‘ICC Commission Report: Controlling Time and Costs in Arbitration’ notes that
considering which witnesses need to give oral evidence or simply a witness
statement as direct evidence can assist in reducing time and costs

Types of Evidence

Evidence:
• written/oral/documentary/real/fact/expert
– Lay: evidence of fact – what they saw, heard, did and said
– Expert: opinion evidence - matters within their specialized knowledge;
arbitrator can appoint (if parties have not)
– Documents – disclosure
– Inspection of property or site or thing

Evidence and Disclosure

• 3rd Party Disclosure and subpoena witness:
– (s.43 AA 1996)
– Apply to court with leave of the tribunal or agreement of parties
– Other court assistance:
 – (s.44 AA 1996)
– On application of a party; and
– With permission of tribunal; or
– Agreement of the parties; and
– Only if arbitral tribunal does not have power or is unable to act effectively

Evidence - IBA Rules

• IBA Rules on the Taking of Evidence in International Arbitration
• Preamble:
– Parties and Arbitral Tribunals may adopt the IBA Rules of Evidence, in whole or
in part, to govern arbitration proceedings, or they may vary them or use them
as guidelines in developing their own procedures. The Rules are not intended
to limit the flexibility that is inherent in, and an advantage of, international
arbitration, and Parties and Arbitral Tribunals are free to adapt them to the
particular circumstances of each arbitration.

• In practice, IBA Rules not wholly adopted to govern arbitral proceedings, although
widely used as guidelines by parties
• Tribunal must not make use of specialist knowledge without giving the parties the
opportunity to comment (unless where arbitrator appointed for his/ her specialist
knowledge)

Role of experts

• Commonly, tribunal entitled to appoint experts for technical matters outside

tribunal’s expertise and experience: eg. s.37
• See CIArb Practice Guideline No 10
• Things to consider:
– Party-appointed expert
– Right to give evidence
– Contentious issue
– Ensuring the right questions referred to experts
– Costs and narrow issues
– Draft reports / without prejudice meetings
Chapters 11: Applications to the Tribunal

Types of Application
• Substantive jurisdiction
• Impartiality and independence
• Expedition
• Disclosure of documents
• Security for costs
• Security deposits
• Interim orders

Consolidation
Consolidation (s.35(1) AA 1996 but only if parties confer power – no power in rules)
• Consolidation requires either:
– Consent of the parties
– Allowed by the rules
– Permitted under the governing law
Party may apply to tribunal for an order of consolidation if:
– Common question of fact or law
– Rights to relief are in respect of same transaction
– Some other reason it is desirable.

Documents and Evidence

• Majority of communications in commerce are in writing; face to face or telephone
discussions may not be recorded
• Forms of evidence:
– Documentary
– Evidence of witnesses of fact and expert witnesses
– Real (material objects)
• Consider appropriate document management

Compulsory Production
• Normal practice in international arbitration is for each party to submit to other
party and tribunal all documents available to it on which it relies
 • Article 27(3) UNCITRAL Rules:
– at any time during the arbitral proceedings the tribunal may require parties
to produce documents, exhibits or other evidence within period of time as
the arbitral tribunal shall determine
• (Articles 3, 9, IBA Rules; s.34(2)(d) AA 1996)

Duty to Disclose?
• However, widely divergent views on a parties’ obligations to disclose:
– Common law? All relevant documents to be disclosed whether they aid or
are adverse to disclosing party’s case
– Civil law? Disclosing party does not need to disclose documents where
adverse to its case (in fact, may be considered malpractice if done so)
• No international arbitration rule for a party to disclose prejudicial documents,
however, general acceptance that tribunal has discretion to order disclosure of
specific documents or narrow classes of documents:
– Article 27(3) UNCITRAL Rules
– Article 3 IBA Rules

Interim Orders/Measures
Purpose:
• to protect the integrity of the dispute resolution process
• to preserve the factual or legal situation so as to safeguard the rights which a party
is seeking to have recognised by the tribunal with regard to the substance of the
case
– [ss.38(4) and 39 AA 1996]

Types of Orders
• Party can make application for interim relief to court before appointment and in
exceptional cases after appointment
• Tribunal can order a party to:
– Provide security for amount in dispute
– Preserve evidence that may be relevant to the resolution of the dispute
– ‘any interim relief… including on provisional basis’ – very wide
– Provide security for costs

For interim orders, need to demonstrate

• Normally five (5) elements need to be demonstrated (note not ‘prove’)
1. Prima facie jurisdiction of the arbitral tribunal
2. Irreparable harm (or not adequately reparable harm)
 3. Urgency of the matter
4. Likelihood of success on the merits (need to show good/plausible overall
case or at least reasonable possibility of success on the merits) – this does
not mean pre-judging the merits of the case
5. If required by the tribunal, appropriate security for any damage that may
result (cross indemnity)

Chapters12: The Hearing

The Hearing – General

• Main principles:
– Nemo iudex in causa sua: no-one should be a judge in his own cause
(impartiality, unbiased, justice is done and seen to be done)
– Audi alterem partem: hear the other side too (notice of hearing, and
affording all parties an opportunity to be heard)
• Civil v common law principles
• Tribunal has broad discretion:
– Party autonomy
– Due process and equality
– Avoid delay and disruption
• Generally, arbitration rules give little guidance as to how a hearing should be
conducted
– (See Article 26 ICC Rules, or Article 28 UNCITRAL Arbitration Rules (2010))
• In most arbitration proceedings the arbitrators have wide discretion as to how an
arbitration hearing should be conducted
• Unless the parties agree otherwise, arbitrators are free to organise the hearing as
they see fit, subject to due process and equal treatment of parties
• Equal treatment requires that both parties are given an opportunity to present
their case orally
• The purpose of oral pleadings at a hearing is to enable parties to recapitulate and
present in an organised fashion most of the factual and legal points on which the
parties disagree

Location
• Under most rules, hearings may be held at locations other than the place (or seat)
of arbitration
• In selecting a location consideration should be given to the availability of support
services such as:
 – an arbitration centre with hearing rooms
– good transport links
– satisfactory hotel accommodation
– transcription services
– translators
– telecommunications including video links

Arrangements
UNCITRAL Notes on Organising Arbitral Proceedings’
• Purpose is to assist practitioners by listing and briefly describing questions on
which appropriately timed decisions on organising arbitral proceedings may be
useful
• Used whether or not the arbitration is administered by an arbitral institution
• The Notes are non-binding, and set out a list of matters for possible consideration
when organising arbitral proceedings
• The Notes talk about whether to hold a hearing, setting dates, order of presenting,
limited time, length of hearing vs. complexity, and whether transcripts are
required
• ICC ‘Effective Management of Arbitration: A Guide for In-House Counsel and Other
Party Representatives’
• ‘Topic Sheet 10’ provides considerations on whether to hold a hearing
• Also includes a list of questions to ask regarding the necessity of holding a
hearing and other issues such as location, attendance, examination of
witnesses, provision of transcripts and interpreters

Attendance and Representation

• Arbitration hearings are private and only those who have a legitimate reason for
attending are permitted to be in the hearing room
• That arbitration hearings are private is an implied term, but not necessarily
confidential: Esso v Plowman (Australia, HCA)
• Each of the parties or their authorised representatives is required to be present
• Whilst the hearing may proceed in absence of a party, time and costs can be
reduced if an informed and knowledgeable party representative with decision-
making authority attends and participates
• A party to arbitration may choose to represent its own case at the hearing or
choose to obtain lawyer, lay advocate or technical advocate (s.36)

Representation of Parties
‘IBA Guidelines on Party Representation in International Arbitration’
– Guideline 4 provides that party representatives should identify themselves
to the other party / parties and the arbitral tribunal as soon as possible
– This is especially important where representation changes in the course of
the arbitration to avoid conflicts of interest which could threaten the
integrity of the proceedings
– Guideline 8 provides the circumstances in which it is not improper for a
party representative to have ex parte communications with an arbitrator,
such as determining the expertise of prospective party-nominated arbitrator

Failure of a Party to attend

• S.41(4) provides for where a party fails to attend a hearing
– If party deliberately absents itself from hearing, hearing may proceed in its
absence (extreme care that tribunal ensures absent party not unfairly
disadvantaged)
• See CIArb Practice Guide Number 4 – provides some guidance for parties and
tribunal where party is absent
• The power of the arbitral tribunal to continue or terminate the proceedings is a
discretionary one and exercisable if the tribunal is satisfied that the defaulting
party has not shown ‘sufficient cause’ for its failure

Order of proceedings
Main objective: simplicity, informality and expedition
– Length of hearing is an issue (depends on complexity, whether written and
oral)
– Arbitrator has broad latitude to determine proceedings
– Claimant first, Respondent second
– Statement of Claim / Statement of Defence
– Opening and closing submissions (possibly a few days prior to hearing - may
be limited to 30 mins)
– Potential issues with written closing submissions – circumvent dialogue
between parties and arbitrator?
– Site visits / inspection required?
– Costs submissions, if required

Transcripts
• Requirement for transcripts an important consideration
 • Note taking will inevitably be limited in scope if the hearing length is to be kept
within control - common to have full transcript of proceedings (shorthand writers
or by recording)
• Translation requirement can be slow and expensive - simultaneous transcripts are
best
• For example, transcripts which appear in real time on the participants' personal
computers can be very useful as they can be annotated as the hearing proceeds
• Real time transcripts are useful - it is important to properly brief the transcription
provider in advance, particularly with unusual names or technical terms likely to
arise in the hearing

Witnesses
• International arbitration adopts a compromise of adversarial (common law) and
inquisitorial (civil law) approaches:
– Common law – witnesses examined by advocates and judges listen
(adversarial)
– Civil law – witnesses can be questioned by a judge (inquisitorial)
– Both parties’ advocates and arbitrator will question witness, advocates
generally have free reign of questioning
• IBA Rules – do not dictate how a witness will be questioned
– However, Article 8 of the IBA Rules outlines the order in which witnesses’
oral testimony will occur
– This order may be varied by the arbitral tribunal at the request of a party or
on its own motion, including the provision of witness conferencing

Chess clock Procedures

• Cut off – may fail to cover issues
• Can be useful to monitor and ensure the fair allocation of time
• Full and reasonable opportunity to be heard (Audi alterem partem)
• Management of case
• Appointment of time-keeper

Documents-only Arbitration
See CIArb Practice Guideline No 5
• A documents-only procedure may be appropriate where:
– dispute is simple; or
– where evidence contained in documents (eg. expert reports) and no need
for oral testimony from witnesses
 • Standard rule among institutes - tribunal has power to determine procedure to be
adopted where no agreement (eg. s.34(2)(h) AA 1996)
• Consider if tribunal should hold hearing if requested by a party

Chapters 13: Remedies, Cost, Interest and Currency

Remedies
• Damages or monetary compensation
• Specific performance
• Restitution
• Injunction
• Declaratory relief
• Rectification of contract: [s.48 AA 1996]
• Generally, remedies available to court are available to arbitral tribunal

Interest

• Sources of authority to award interest:

– Submissions of parties
– Arbitration agreement
– Underlying contract
• Governing Law of Contract (statutory interest rates)
– Arbitration rules
• Most Rules silent as to interest
– Lex arbitri
• s.49 AA 1996
• How to award interest
– Interest rate
– Pre-award and post-award
– Simple or compound
– Enforceability

General Principles (CIArb Practice Guideline)

• Interest recoverable as right: apply contract, statute or law on which the claim for
interest is based
• Discretionary interest
– Interest should be compensatory, not punitive
– Interest should be assessed on commercial basis
– Actual financing arrangements generally not relevant
 – Special circumstances affecting borrowing rates generally not relevant
– Reference to interest applicable to short term unsecured loans

Currency
• Determination of currency of award
– Submissions of parties
– Arbitration agreement
– Underlying contract
– Customary practice
– Arbitration rules
– Lex arbitri
• General principles:
– Arbitral tribunal has the power to choose the currency (or currencies) of the
award, taking into account the above factors
– Arbitral tribunal should award damages in the currency which most justly
expresses the loss suffered by claimant
– Milan Nigeria Limited [2011], EWHC 892 (Comm)

Costs
• Basis of authority for awarding costs:
– Arbitration agreement
– Underlying contract
– Arbitration rules
– Lex arbitri
• Definition of Costs (s.59 AA 1996):
– Fees of the arbitral tribunal
– Reasonable travel and expenses of arbitrator
– Reasonable costs of expert advice
– Reasonable travel and expenses of witnesses
– Reasonable legal and other costs of parties
– Fees and expenses of arbitral institution or appointing authority
– Costs of hearing, etc
• Allocation of Costs (ss.63-65 AA 1996)
– ‘Costs follow the event’: costs in principle borne by the unsuccessful party
– Arbitral tribunal may apportion costs as it deems reasonable, taking into
account the circumstances of the case
 – In final award (or any other award), arbitral tribunal may determine any
amount that a party may have to pay another party as a result of the
decision on allocation of costs
• Offers of compromise or settlement
• Conduct of the parties
• Deposit of costs
• Security for costs
• CIArb Practice Guideline 9

Chapters 14: Awards

The Award
• Can have different awards: s.47 AA 1996 (E&W)
• Time for making award:
– Time may be extended by
• Parties agreeing; or
• By order of court (s.50 AA 1996)
– [Better to get agreement of parties]

Types of Awards
• Types of awards
– Final award
– Partial award
– Interim award
– Default award
– Consent award (s.51 AA 1996)

Form and Content of Award

• Form and content of award – UNCITRAL Model Law Article 1
– Shall be made in writing, signed by the arbitrator(s)
– Shall state the reasons upon which it is based
– Shall state the date and place of arbitration
– Shall be delivered to each party (or to institution)

The Award: structure

• Parties, Institution, Rules
• Arbitration Agreement, Governing Law, Seat
• Jurisdiction, Formation of Tribunal
 • Procedural History
• The Dispute, the Contract, Governing Law
• The Issues, Parties’ Submissions, the Evidence
• The Law?
• The Decision and Reasons
• Quantum, Costs, Interest
• Operative Orders and Awards
• Signatures, Place, Date

Chapters 15: Role of the State Court

Court’s Powers
• Article 5 ML limits court’s powers:
In matters governed by this Law, no court shall intervene except where so provided by this
Law
• Article 6 ML confers on court (or other authority, such as an institution) powers
concerning certain functions of arbitration assistance and supervision
• Before an arbitration commences:
• Stay legal proceedings that are in contravention of a valid arbitration
agreement: Art 8 ML and Art II NYC
• Interim measures before constitution of a tribunal: Art 9, Art 17 ML
• Appointment of a tribunal: Art 11 (4) ML

• During an arbitration:
• Appointing, replacing or removing arbitrator: Art 11, Art 14 and Art 15
• Challenges to impartiality and independence of arbitral tribunal: Art 13(3)
ML
• Challenges to substantive jurisdiction of tribunal: Art 16 ML
• Interim measures: Art 17J ML
• Preliminary points of law: Art 16 ML
• Taking of evidence: Art 27 ML

• After an arbitration:
• If seat, then set aside applications: Art 34 ML
• Whether seat or not, enforcement applications: Art 36 ML
• Appeals (where provided for): ss67-69 AA 1996

Following issue of Award

The 4 challenges:
• Correction of errors – ML Art 33 (1)a, ML Art 33(2)
• Interpretation – ML Art 3(1) b and ACICA Rule 36
• Additional award procedure ML Art 33 (3)
• Appeal on point of law or on the merits ?
– Domestic arbitration - appeal on a point of law
– Malaysian Arbitration Act – opt in and out
– Contrast English Arbitration Act s.69

Enforceability of Awards

• Awards enforceable under the New York Convention 1958 unless set aside
• Can be set aside or successfully challenged on the grounds set out in New York
Convention:
– Defective arbitration agreement
– Denial of procedural fairness
– Excess of jurisdiction
– Improper arbitral composition/procedure
– Award not binding/set aside
– Arbitrability
– Public policy

Article V New York Convention

GROUNDS:
• the only grounds for setting aside/refusing recognition and enforcement
• reflect a pro-enforcement bias that strongly discourages any review on the merits
• of a predominantly procedural rather than substantive character
• tracked by Articles 34-36 of Model Law (‘symmetry’)
• implemented by local legislation
– eg Section 24 Arbitration Act 2010 (Ireland)
• Article III – Obligation to recognise and enforce foreign arbitral awards
• Article IV – Procedure for enforcement or recognition of foreign arbitral awards
• Article V – Grounds for refusal of enforcement or recognition of foreign arbitral
awards

UNCITRAL Model Law

Chapter VII: Recourse Against Award

 • Article 34: Application for setting aside as exclusive recourse against arbitral award

Chapter VIII: Recognition and Enforcement of Awards

• Article 36: Grounds for refusing recognition or enforcement