THE AUTHOR:
Frederik Kromann Jespersen, Head of Specialized Dispute Resolution at Skau Reipurth Law Firm
The success of an arbitration may be measured in many ways. For the parties to the arbitration, success most often depends on the arbitral award as to the merits of the case. But even for the parties, a successful arbitration also means being party to a process in which the procedural rights of the parties are safeguarded, and in which the parties feel comfortable that all (relevant) arguments have been carefully considered by the tribunal.
The same is true for the members of the arbitral tribunal. For them, it is paramount that the parties are confident that they can safely entrust the tribunal with the professional task of resolving the parties’ dispute as swiftly and effectively as possible. Or at least, that is how it should be.
Arguably, arbitrators who are not sufficiently responsive, often due to time constraints, and those who fail to respect the collective decision-making process of a tribunal, form one of the greatest threats to the efficiency of arbitration. Although it may be said that the chair of the tribunal is responsible for ensuring the effective collaboration amongst the members of the tribunal, this is essentially a joint responsibility incumbent upon all members of the tribunal. This is particularly true as the tribunal should ideally be seen as one unit in which all members are equally invested in safeguarding the principles of the arbitration proceedings. However, ensuring that this ambition is also reflected in practice may often prove difficult.
Establishing Internal Guidelines for the Arbitral Tribunal
For any collective organ (such as an arbitral tribunal) to function effectively, it is imperative to have in place specific work guidelines by which the members should abide. Following the first case management meeting with the parties, the arbitral tribunal typically issues its “Procedural Order no 1” to establish the external guidelines of the arbitration proceedings for the benefit of the parties.
In the same way, the tribunal should establish internal guidelines for the benefit of the arbitrators. These should set out the overall roadmap of the workflow of the tribunal, covering issues pertaining to the oral hearing as well as the post-hearing phase.
Such guidelines should ideally be communicated by the chair of the tribunal to the tribunal members as soon as the tribunal has been established, subject of course to the course of the arbitration. However, in practice, this does not always happen, which potentially gives rise to frustration and uncertainty as to what is to be expected of the arbitrators during the arbitration proceedings.
It is likely difficult to draft “one-size-fits-all” guidelines, but ideally, they should address at least the following points:
Outline the Responsibilities Pertaining to the Arbitration
The guidelines should define the roles of the arbitrators during the arbitration, particularly with regard to the possibility of asking questions (if any) to the parties and/or witnesses during case management meetings and the oral hearing. Sometimes, the chair of the tribunal prefers being the one in charge of asking such questions or at least deciding when the co-arbitrators get to ask questions. Aligning on how to address the parties and/or witnesses makes the tribunal come across as an efficient and coordinated unit.
It may also be useful to agree in advance on any practical aspects of the process, e.g. whether one or all arbitrators should be in charge of noting the (supplemental) statements of parties and witnesses during the oral hearing and whether other particular tasks should be distributed amongst the arbitrators.
Set Clear Deadlines
There should be clear deadlines when it comes to drafting the award, including when the first draft may be expected and when comments and/or suggested changes to this draft should be exchanged. The lack of clear deadlines often gives rise to frustration and may render the workflow of the tribunal inefficient to the detriment of the proceedings as such.
When setting deadlines one should leave ample time for deliberations (while of course bearing in mind any potential time restraints of the arbitration institute, if applicable). Particularly with regard to international arbitrations, the arbitrators have different legal and cultural backgrounds often rendering it necessary to explore the legal issues of the case from different perspectives. This is arguably the strength and value of having an international tribunal as part of which the parties have often appointed specific arbitrators to resolve the dispute. But it may also be a time-consuming process, and there should be ample time for the arbitrators to discuss the relevant issues in order also to facilitate any necessary compromises when it comes to drafting the award.
Schedule Internal Meetings Prior to the Oral Hearing
The guidelines should include the possibility of scheduling internal meetings for the arbitrators whenever necessary, e.g. shortly after the parties’ submissions. Often, the arbitrators only meet to discuss the matter shortly prior to the oral hearing (unless formal issues require otherwise). But it may be advantageous for the arbitrators to discuss the status of the proceedings on an ongoing basis to ensure that all members of the tribunal are aligned in terms of what seems to constitute the relevant contentious issues. Of course, this does not mean that the arbitrators need to agree on these issues at this stage, but it is important that everyone is up to speed and properly prepared for the oral hearing. This may also make the deliberation process easier.
The points above by no means form an exhaustive list of subjects that may be included in the internal guidelines of the tribunal. But they represent a set of issues which often cause uncertainty and sometimes even frustration on the part of the arbitrators if not dealt with timely. Establishing not only external guidelines for the parties but also internal guidelines for the tribunal members may alleviate some of the hindrances to a well-organized process, and ensuring an efficient process is after all one of the key factors of arbitration.
ABOUT THE AUTHOR
Frederik Kromann Jespersen is a lawyer based in Copenhagen. He specializes in commercial litigation and international arbitration and heads the Specialized Dispute Resolution department at Skau Reipurth. He acts as legal counsel to Danish as well as international clients in disputes of various kinds, including particularly disputes concerning commercial contracts, intellectual property law, competition law, M&A disputes, management liability, marketing practices, and corporate criminal liability.
He has the right of audience before the Danish Supreme Court and frequently acts as an arbitrator in national as well as international arbitrations.
*The views and opinions expressed by authors are theirs and do not necessarily reflect those of their organizations, employers, or Daily Jus, Jus Mundi, or Jus Connect.
