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Arbitration Law Introduction. Types of dispute resolution. Arbitration agreements. Arbitral Tribunal. Appointment of arbitrator, qualifications, remuneration, rights and duties. Termination of appointment. Commencing the reference, Procedures to be followed Pre-hearing Issues. The Hearing. Arbitration Awards. Judicial control of arbitration. (case stated/set aside/removal) International Arbitration white book comm. Law

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Introduction: Types of Dispute Resolution

No matter how well a contract is drafted, how comprehensive or well planned it is disputes arise. There are several methods by which commercial disputes can be resolved. The main forms are as follows:1 Negotiation 2 Litigation 3 ADR (alternative dispute resolution which includes conciliation and mediation or mini trial) 4 Arbitration. Negotiation between the parties in dispute or their representatives should be the first step as it is more economical than the other methods of resolution, the details of the transaction in dispute remain private and the parties remain in control. Also where a negotiated settlement is reached by implication both sides are reasonably content with the outcome. It is also easier maintain a mutually beneficial relationship after a negotiated settlement than after an intense battle in court for example. Where a negotiated settlement cannot be reached recourse to other mechanisms of dispute resolution may be necessary. Conciliation and Mediation and Mini-trials These aim to achieve an amicable settlement through the use of an independent and impartial third party. The terms conciliation and mediation are often used interchangeably though there is a distinction:- a conciliator may seek to find common ground between the parties and encourage them to reach a settlement whereas a mediator on the other hand can be more active in trying to achieve a settlement. A mediator brings proposals and counter-proposals to the parties and helps them to settle. Mediation or conciliation per White on Commercial Law are best suited to parties with a friendly trading relationship. They have the advantages of privacy and speed. UNCITRAL and the ICC each promote there own set of conciliation rules that can be

adopted by parties seeking to solve their disputes by means of conciliation. Mini-trials are a form of small scale in-house litigation where the issues in dispute are presented by each parties in-house lawyers to a panel of senior executives, one from each side (who are not connected with the dispute), there is usually a neutral chairman, eg a retired Judge. After hearing the presentations the panel retires and reaches a negotiated settlement which should be in the form of a written agreement which can thus be enforced as a contract. ADR is now part of the Civil Procedure Rules in the UK since 1999 where courts are placed under an express duty to manage cases including encouraging parties to use ADR if the Courts consider it appropriate and facilitating such use. The Courts general power of case management could allow it order parties to use ADR. A party can request in writing that cases be stayed pending ADR. In deciding the matter of costs the Court can look at how a party behaved, in particular the effort made to try to resolve the dispute during the proceedings. There are similar provision in our Commercial Court In Ireland a Judge of the Commercial Court (a division of the High Court which deals with certain commercial cases) may adjourn commercial proceedings for not longer than 28 days, in order to refer the dispute for mediation, conciliation or arbitration. (See Legal Methods Notes re Commercial Court/List). The Civil Liability and Courts Act 2004 has provisions in relation to mediation in personal injuries actions. Section 15 provides for a mediation conference. Upon the request of any party to a personal injuries action the court may direct that the parties meet to discuss and attempt to settle the action. (where a party fails to comply with such a direction the Act provides that the court may direct that party to pay costs incurred after the giving of the direction). The parties may agree on a mediator or, in the absence of such agreement, the court may appoint a person to chair the conference. Where a court appoints a chairperson, the mediator must be a practising barrister or solicitor of not less than five years standing or a person nominated by a body prescribed by order. The section provides that the notes of a chairperson of a mediation conference and all communications during it shall be confidential and cannot be used in evidence in any subsequent civil or criminal proceedings. People will be able to admit to having been somewhat negligent without this being thrown at them afterwards in court as a concession they made during the conference. Section 16 of the Act provides that the chairperson of a mediation conference must prepare and submit to the court a report of the conference. The report shall outline that the mediation conference took place, if it did not take place the reasons why, or where it took place, whether a settlement was reached, whether a settlement has been entered into and a statement of the terms of the settlement signed by the parties. A copy of the report is given to each party to the action at the same time it is submitted to the court. Arbitration Arbitration is a process by which parties voluntarily refer their dispute to an impartial third party (an arbitrator) selected by them for a decision which is legally binding on all the

parties. It thus requires the consent of all parties to the dispute. Thus it is a method of resolution of disputes that is final, binding and enforceable. Arbitration is voluntary and consensual and by third party adjudication.. Arbitration is different from other means of dispute resolution in that:a. it is a consensual process that offers finality b. it is a private process hearings are in private and details of awards are not published. c. parties can select their own adjudicator often on the basis of skill or expert knowledge. Arbitration is said to avoid many of the drawbacks of litigation and has the following advantages 1 Speed at times it can be much quicker than court. As the parties have control over the procedure they have control subject to the co-operation of the arbitrator of the speed in which the arbitration will be conducted and the time within which they may have a ruling. 2 Cost savings .- As the parties have control over how the arbitration is conducted they have control over the costs. 3 Confidentiality unlike court cases arbitrations are conducted behind closed doors. Arbitrations are held in private and remain private unless there is an issue that becomes the subject of a court reference. 4 Choice of adjudicator (who may have technical qualifications) whereas in court cases the parties have no say whatsoever which Judge they get. Thus they can get someone with specialist knowledge. If they are unable to agree on the arbitrator they can choose the method by which the arbitrator is appointed. 5 Power to control the time and place of the proceedings. 6 Procedural flexibility the conduct of arbitration is not tied to a defined procedure subject to minimum standards of fair procedures the parties themselves or in conjunction with the arbitrator can determine the procedures to be used. Finality 7 An award is final and binding and cannot be the subject of an appeal other than under one of the limited headings permitted by the Acts 8 Enforcement - Resolution of the dispute in the form of a final and binding award which allows for greater internationally enforcement as most countries in the world are party to an international convention facilitating the mutual enforcement of their arbitration awards. (The New York Convention on the recognition and Enforcement of Arbitration Awards 1958) . Disadvantages of Arbitration 1 Costs the parties unlike a court situation are also responsible for the costs of the arbitrator and the venue 2 Types of disputes an arbitrator does not have jurisdiction over persons not parties to the agreement or over issues not covered by the agreement. Thus disputes between the parties over other issues or involving third parties will have to be the subject of separate proceedings (usually litigation)

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Sanctions An arbitrator does not have all the powers of a judge to impose sanctions on a defaulting party eg he cant strike out proceedings for want of prosecution. Arbitration can in its own right be costly and time consuming and in certain circumstances an arbitrators award can be reviewed before a court of law.

Types of disputes referred to arbitration: shipping, engineering insurance, travel Disputes that are not arbitrable:-disputes with third parties where injunctive relief is required, -disputes re validity or accuracy of public registers, -criminal matters, -where the parties are not willing to enter an agreement to refer present or future disputes to arbitration

Types of Arbitration
Arbitration can either be institutional or ad hoc, domestic or international.

Institutional Arbitration is administered by one of the many specialised arbitration

institutions under their own arbitration rules eg the Chartered Institute of Arbitrators ( in Ireland), the London Court of International Arbitration (England), The International Chamber of Commerce (Paris), the American Arbitration Association (USA). With institutional arbitration there is a set of pre-drafted procedural rules under which the arbitration will be conducted and the institution provides trained staff to administer the arbitration, these are the advantages of institutional arbitration but on the other hand it can also be expensive and inflexible especially in respect of time limits.

Ad Hoc Arbitration
This is conducted under rules adopted to cover a particular dispute. The rules can be adopted from international rules, drafted by the parties and or the arbitrator and therefore dealing with the specific dispute. Thus with ad hoc arbitration one must first establish the infrastructure (which is already in existence in Institutional arbitration).

Domestic
An arbitration is domestic where all the relevant factors in respect of the dispute;- subject matter, domicile of the parties, place of arbitration, applicable law converge in a single place. The more diverse the above the more likely the arbitration is international in nature as opposed to domestic.

International
The Arbitration (International Commercial) Act 1998 adopts the UNCITRAL Model Law and states that and arbitration is international if:

the parties to an arbitration agreement have, at the time of the conclusion of that agreement, their places of business in different states; or b. one of the following is situated outside of the state in which the parties have their place of business: (i) the place of arbitration if determined in, or pursuant to the arbitration agreement; (ii) any place where a substantial part of the obligations of the commercial relationship is to be performed or the place with which the subject matter of the dispute is most closely connected; or c. the parties have expressly agreed that the subject matter of the arbitration agreement relates to more than one country. Thus the matter is influenced by the nationality of the parties and the nature of the dispute. The 1998 Act provides that the Arbitration Acts 1950 and 1980 do not apply to international commercial arbitration as defined in s16 of that act.

a.

Irish Arbitration Law

Irish arbitration law is governed by the Arbitration Act, 1954, Arbitration Act, 1980 and the Arbitration (International Commercial) Act, 1998 Though certain kinds of disputes may be governed by particular statutes then we have what is known as Statutory Arbitration- eg

Matters which may be referred to arbitration The general rule is that any dispute or claim concerning legal rights which may be the subject of an enforceable award is capable of being settled by arbitration but the following should be noted:1 The High Court has full original jurisdiction to determine all matters of fact and law, civil and criminal per Art 34 of the Constitution 2 Certain kinds of arbitrations are governed by special statute The arbitration system governed by the Acquisition of Land (Assessment of Compensation) Act 1919 which provides compensation for a landowner whose land has been acquired under a compulsory purchase order to be determined by arbitration by one of 2 statutory arbitrators appointed for that purpose under the acts, 3 Public policy requires that certain issues be dealt with by the courts or some other statutory tribunal 4 Illegality may render an arbitration agreement unenforceable 5 An arbitrator does not have power to order specific performance of any contract relating to land or any interest in land s26 1954 Act ___________________________________________________________________ Arbitrations relating to employment excluded from the ambit of the arbitration acts S5 of the 1954 Act states that notwithstanding anything stated in the Act the 1954 Act does not apply to :(a) an arbitration under an agreement providing for a reference to, or the settlement by arbitration of any question relating to the terms or conditions of employment or the remuneration of any employee, including persons employed by or under the State or Local Authorities or (b) an arbitration under S70 of the Industrial Relations Act 1946 (No 26 of 1946) This is to allow these matters be delat with by tribunals established to deal specifically with employment disputes EG Employment Appeals Tribunal.

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Arbitration Agreements
The basis of arbitration is an agreement between the parties to a dispute to submit it to arbitration. Unless the dispute in question is subject to such an agreement then a person purporting to arbitrate it has no legal authority to so do. Most arbitration agreements contemplate future disputes, i.e. disputes not in existence at the time the agreement is made but which will or may arise in the future. There can be ad hoc submissions to arbitration ie submissions of an existing dispute). Ordinarily any such agreement or submission does not affect third parties. Thus an arbitration agreement means (b) an agreement to submit a future dispute to arbitration (this usually takes the form of an arbitration agreement in a more substantial agreement) (c) an agreement to submit an existing dispute to arbitration (a submission agreement) They both have the same effect but when a submission agreement is being drafted the dispute has actually arisen and thus the parties can tailor the agreement to fit the actual dispute versus the situation in respect of an agreement re a future dispute where there is less detail as the parties dont know what kind of dispute may arise or how it should best be dealt with. S2 1954 Arbitration Act states that an arbitration agreement is: a written agreement to refer present or future differences to arbitration, whether an arbitrator is named therein or not. S2 1980 Arbitration Act further provides that an arbitration agreement is: a written agreement (including an agreement contained in an exchange of letters or telegrams) to submit to arbitration present or future differences capable of settlement by arbitration. S4(1) 1998 Act Arbitration agreement means an arbitration agreement concerning international commercial arbitration Examples of Arbitration agreements:- once off commercial contracts may contain specific provisions in respect of resolution of any disputes by arbitration; standard conditions of

building contracts, insurance policies, travel booking forms (1) Form of the Agreement For the purposes of the 1954-1980 Arbitration Acts the arbitration agreement must be in writing (including electronic signatures under the E-Commerce Act 2000). This means that an oral agreement, whilst not being invlaid will not be governed by the provisions of the Arbitration Acts which could be very important when it comes to the time when you wish to enforce the award because an award under the Arbitration Acts may be enforced by leave of the High Court in the same manner and to the same effect as a court order or judgment. St. Raphael [1985] 1 Lloyds Rep 403 The Court of Appeal stated that for an agreement to be a written arbitration agreement it was not necessary for the whole contract, including the arbitration agreement, to be in the one document, rather it was sufficient that the arbitration agreement itself was in writing and it was sufficient that there was a document that recognised the existence of the agreement. Also it was stated that the agreement need not be signed. Thus the agreement to arbitrate must be in writing but the rest of the contract could be oral. An exchange of telex communications has been held to constitute an agreement in writing (Arab Africa Energy Corp Ltd v Olieprodukten Nederland BV [1983] 2 Lloyds Rep 419 Where an arbitration clause (agreement) is incorporated from another document to be effective the incorporation must be clear and express Sweeney v Mulcahy [1993] ILRM 289 (11) Giving effect to the arbitration agreement staying litigation The inclusion of a Scott v Avery clause is a useful addition to an arbitration agreement as a means of ensuring that the matter goes to arbitration. A Scott v Avery clause makes arbitration a condition precedent to litigation. It is enforceable as it does not oust the jurisdiction of the court but merely ensures you must go to arbitration first. (Thus no cause of action arises upon which one can litigate until there is an award by the arbitrator). Statute of limitations re Arbitration 6 years if contract/ 12 years if under seal Atlantic Shipping Clauses are time bar or claim bar clauses (bar claim completely) contractual agreements that may bar the remedy of arbitration. These put a limit on the uncertainty which surrounds possible claims Atlantic Shipping v Dreyfus The Courts held that Atlantic Shipping clauses are not contrary to public policy they are a type of exclusion clause and will be construed contra preferentum. Thus if you are out of time in respect of your claim an arbitrator can only make a

declaratory award that you are out of time. The legislative response to this was S45 of the 1954 Act allows the court to extend the time limit for arbitration provided for in an Atlantic Shipping clause where there is undue hardship. Walsh v Shield Insurance [1977] ILRM 218 Applicant shop-keeper had an all in insurance policy. In 1970 one of his employees was injured in the shop on Oct 5th. The Insurance company was notified on Oct 13th and they repudiated the policy drawing the applicants attention to clause 15 of the contract which was an arbitration clause with a 12 month time limit. In June 1971 Solicitor wrote to Shield. 1973 Shield re-iterated its point. Jan 17th 1973 the applicant sent a notice to Shield requiring them to concur in the appointment of an arbitrator. S45 application to court to extend time July 1976 - 6 years since commencing claim and 3 years since commencing arbitration. Hamilton J in HC referred to the delay but extended time as felt claimant would suffer undue hardship and no prejudice to the defendant, applicant penalised as to costs. Staying litigation Where despite the existence of an arbitration clause both sides want their dispute to go to court the arbitration clause is overridden by this new agreement and made redundant by that new agreement. On the other hand where one party in opposition to the arbitration agreement commences litigation the court at the request of the party willing to go to arbitration have the power to stay the litigation in order to give effect to the arbitration agreement. Under the 1954 Act this power was discretionary but the 1980 Act removed this discretion in relation to domestic and international arbitration making the granting of a stay mandatory in certain circumstances. S5 of the 1980 Act (1) to an arbitration agreement or any person claiming through or under him, commences any proceedings in any court against any other party to such agreement, or any person claiming through or under him in respect of any matter agreed to be referred to arbitration, any party to the proceedings may at any time after an appearance has been entered and before delivering any pleadings or taking any other steps in the proceedings, apply to the court to stay the proceedings, and the court, unless it is satisfied that the arbitration agreement is null and void, inoperative or incapable of being performed or that there is not in fact any dispute between the parties with regard to the matter agreed to be referred, shall make an order staying the proceedings (2) Nothing in this section shall be construed as limiting or otherwise affecting the power conferred on the High Court pursuant to section 39 (3) of the Principal Act to refuse to stay any action brought in breach of an arbitration agreement

"(3) Nothing in this section shall prevent any party to an arbitration agreement from invoking the alternative method, provided by the Rules of Court (as amended from time to time), of commencing and dealing with a civil proceeding in respect of a small claim.". (ss3 inserted by the 1998 Act) Now provided the dispute which a party is trying to litigate falls within the scope of an enforceable arbitration agreement he made, on the application of the other party the court will direct those proceedings will be stayed. Where the party who obtained the stay then unduly delays in carrying on with the reference the court may conclude that he has abandoned the arbitration agreement and may decide to lift the stay. OMahony v Lysaght [1988] IR 29

Prerequisites for a stay. In order to obtain a stay the following must be established:1. An enforceable arbitration agreement must exist between the applicant for a stay and the party to the court proceedings or party claiming through him 2. The parallel proceedings must be being brought in a court not an administrative or quasi judicial tribunal or in another arbitration. 3. The parallel proceedings must have commenced ie you apply for a stay after an appearance has been entered but before taking a step) otherwise the application is premature 4. The claim being made in the proceedings must be one covered by the arbitration agreement. The authority of the court to stay proceedings between parties to an arbitration clause extends to persons who are claiming through or under either of the parties. This phrase has been held to apply to a trustee of a bankrupts estate, an assignee of a debt arising out of a contract containing an arbitration clause, a subsidiary company where the parent was a party to the arbitration agreement and vice versa. Steps in the proceedings If the party seeking a stay has taken steps in the proceedings his application for a stay will be refused .Steps are conduct on his party which shows a decision on his part to use the proceedings already commenced to advance his case against the other party. In McCormack Products Ltd v Monghan CoOp Ltd [1988] IR 304 the applicant for a stay had obtained an interim injunction against the other party, and was thus held to have elected for litigation and thus a stay was refused. In OFlynn v Bord Gais [1982] ILRM 324 Where the defendants solicitor wrote to the other side seeking an extension of time to put in a defence the court held this was not a step which would preclude a stay . There Finlay P stated that the test for whether a step had been taken or not was whether the

action ( potential step) involved costs which would be lost were the stay to be granted and the matter referred to arbitration. The Court in which the case is listed can stay the proceedings per the Supreme Court in Mitchell v Budget Travel Ltd [1990] ILRM 739 Things that a party trying to resist a stay will argue 1 steps taken in proceedings 2 arbitration agreement is null and void eg due to illegality or no offer and acceptance 3 arbitration agreement is inoperative (i) eg a particular person is named in the agreement and he cant act, (ii) High Court has ordered that the agreement has ceased to have effect (iii) Common law doctrines of frustration, abandonment or repudiation, OMahony v Lysaght delay in bringing the dispute to arbitration does not necessarily render the agreement inoperative but if the delay continues the agreement may be construed inoperative and the stay lifted. (iv) Novation (some further agreement of the parties) Liston v OMalley Stay refused as arbitration agreement was contained in an earlier written agreement which was superceded by a later oral agreement Murphy J said the arbitration agreement was inoperative, it didnt relate to the dispute in question, it was superceded JWT v McCarthy [1999] ILRM 813 The plaintiffs ought a package holiday from the defendant werent happy went to court, the defendants entered an appearance and then sought a stay. The arbitration agreement in travel contract that the dispute would be referred to an arbitrator. Said agreement included a provision which excluded liability for personal injuries and limited liability for other claims to 5,000. This was an exclusion clause or limitation clause and was noted in the arbitration agreement and the box for signature in the travel contract said all terms and conditions of this contract have been brought to my attention and read. The Court found that this express term varied the defendants liability under the implied terms of s39 of the Sale of Goods and Supply of Services Act 1980 and to be effective under s40 of that act had to be fair and reasonable and brought to the specific attention of the plaintiffs. It was held as a matter of fact that the Condition was not brought to customers attention, deal done over the phone and customer signed afterwards. Dealing with the whole clause as one the court found the clause was not effective and refused a stay under S5 as it was inoperative or incapable of being performed. (Perhaps the arbitration clause and the exclusion clause could have been treated separately thus allowing the matter go to arbitration)

In Carroll v Budget Travel v Counihans Travel Unrep HCT Morris J., Dec 7, 1995. That held that a standard arbitration clause found in a contract for supply of holiday services is not an express term within the meaning of S40 of the Sale of Goods and Supply of Services Act 1980 and it was therefore irrelevant whether it was brought to the consumers attention and a stay under S5 was granted. 4 5 (v) atlantic shipping clause arbitration agreement is incapable of performance per the Rena K it means some obstacle that frustrates the willingness of the parties to go to arbitration S39(3) 1954 Act gives a discretion to refuse to grant a stay where under s39 the court has power to set aside the agreement on the basis that the dispute involves a question as to whether any party has been guilty of fraud. (See Winterthur Swiss Insurance case OHanlon J listed the factors to be taken into account in deciding whether or not to refuse a stay where allegations of fraud (i) complexity of case and difficulty of legal issues (ii) bona fides of parties alleging fraud (iii) no obligation on parties opposing stay to prove fraud prima facie If case is one of great complexity it is presumed that the High Court would be a more suitable venue. See also Administratia Asigurailor de Stat v Insurance Corporation of Ireland [1990] ILRM 159 overriding jurisidcition to refuse a stay where bona fide allegations of fraud.

S18 of the Arbitration (International Commercial) Act 1998 S18. Section 5 of the Arbitration Act, 1980 , is hereby amended by the insertion of the following subsection after subsection (2): "(3) Nothing in this section shall prevent any party to an arbitration agreement from invoking the alternative method, provided by the Rules of Court (as amended from time to time), of commencing and dealing with a civil proceeding in respect of a small claim.". (111) The scope of agreement The arbitration agreement determines the jurisdiction of the arbitrator and what disputes can be submitted to arbitration. The arbitrator must not exceed the powers given him by the parties. Whether a particular dispute is subject to arbitration depends on the very wording of the arbitration clause. A clause recommended by the International Chamber of Commerce stipulates that: all disputes arising in connection with the present contract shall be finally settled

under the rules of Conciliation and Arbitration of the International Chamber of Commerce by one or more arbitrators appointed in accordance with the said rules Irish Travel Agents Association Clause Booking form in brochures Arbitration arranged by the Chartered Institute of Arbitrators Irish Branch on behalf of tour operators who are members of the ITAA Any dispute or difference of any kind whatsoever which arises or occurs between any of the parties hereto in relation to any thing or matter arising under, out of or in connection with this contract shall be referred to arbitration under the Arbitration Rules of the Chartered Institute of Arbitrators-Irish Branch There are many decisions construing the form of words. Ashville Investments Ltd v Elmer Contractors [1989] QB 488 stated that in seeking to construe a clause in a contract there is no scope for either adopting a liberal or a narrow scope. The exercise which has to be undertaken is to determine what the words used mean. If there are 2 possible meanings of the words the courts have to prefer one over the other in accordance with settled principles. If one meaning is more in accord with what the court considers to be the underlying meaning and purpose and intent of the contract or part of it than the other the court will prefer it. In the interest of certainty and clarity a court may think it right to construe words in an arbitration agreement the same way as in previous cases involving an arbitration clause by another court but in the opinion of the court in Ashville the subsequent court is not bound by the doctrine of stare decisis. Thus same phrase or formulation of words can differ from contract to contract and thus the following cases can be seen as persuasive only. Ashville Investments held that in connection with is sufficiently broad to encompass claims arising from misrepresentation where it induced entry to contract. The Playa Larga case held that in connection with covered claims in conversion, contract and tort. There must be a close connection between the claim in Tort and the contract giving rise to the arbitration agreement. The transaction in which the tort arose should be the on in which the arbitration clause was agreed. Government of Gibraltar v Kenna disputes arising under this contract There was a claim that the contract was frustrated leading to a claim for restitutionary relief on a quantm meriut basis (unjust enrichment) as you cant sue for breach of a contract as it doesnt exist any more. The question was did the arbitration agreement cover the dispute. It was held that the clause disputes arising under this contract meant the clause was restricted to contractual claims only. Thus where an arbitration clause uses the words under this contract it excludes claims in

tort and all other kinds of action. Disputes arising out of or in connection with Woolf v Collis Removal Services [1947] 2 AER 260 covered claims concerning alleged mistake or misrepresentation as well as extra-contractual claims such as quantum meriut and unjust enrichment and even tort claims connected with the contract. Out of under or in connection with Carroll (A Minor) v Budget Travel Very broad clause

There are 2 main question in respect of the scope of the agreement 1 Can the arbitrator decide the extent of his own jurisdiction and 2 If the arbitration clause is contained in a contract, can the arbitrator decide whether that contract is void ab initio due to mistake or illegality ie decide on the existence of the contract. (1) As regards the first question there are no Irish authorities on point. In the case of Dalmia Daries v National Bank of Pakistan [1978] 2 Lloyds Rep 103 it was accepted that in English law an arbitrator cannot pronounce on his own jurisdiction, that being an issue for the courts. The court did hold that the arbitrator had power, when his jurisdiction was challenged to enquire into the merits of the issue of whether he has jurisdiction, not as a means of making a binding conclusion but to satisfy himself as a preliminary matter whether he should continue with the arbitration or not. Where a party claims that the arbitrator lacks jurisdiction he should make it clear he is objecting and that his continued participation in the process does not prejudice his claim of lack of jurisdiction otherwise it may be interpreted that he is submitting to the arbitration. (2) Historically a distinction has been drawn between the initial existence of a contract and the continued existence of it. The traditional view is that an arbitrator cannot make a binding award as to the initial existence of a contract. If there is no contract an arbitration clause in a non-existant contract cannot empower the arbitrator decide on the initial validity of the contract (that is for the court). Where the issue is in respect of the continued existence of the contract, ie it did originally exist but for some reason (eg repudiation, frustration, misrepresentation) the contract comes to an end the court uses the notion of the seperability of the arbitration clause from the rest of the contract to allow the arbitrator to make a decision as to the continued existence of the rest of the contract. In Heyman v Darwins (1942) MacMullan LJ held that an arbitration cause in a contract is something quite distinct from other clauses in a contractual document, the other clauses set out the obligations the parties have towards each other whereas the arbitration clause represents something greater it is a

mutual obligation. That mutual obligation is to see that any disputes are resolved by arbitration. Thus when a party repudiates a contract it does not abrogate the contract but it may release the injured party from their continuing obligations which they entered into with the other party. In Heymans where the contract is repudiated the arbitration clause survives, it is severable from the main contract. As the arbitration clause is severable from the main contract it allows the arbitrator to derive power from an independent arbitration contract to determine whether the main contract still exists essentially depends on the parties intention and the construction of the clause. Harbour Assurrance Co (UK) Ltd v Kansa General International Insurance Co Ltd [1993] 1 Lloyds Rep 445 The Court of Appeal stated that an arbitration clause is usually a self contained collateral contract and on construction of the clause, the arbitrator could deal with the issue of illegality. This places the emphasis on the intention of the parties as expressed in the arbitration clause Exclusions S5 of the 1954 Act excludes Employment and Industrial relations disputes from its scope.The reason for this would appear to have been to allow such disputes be settled by the tribunals established specifically to deal with them. The 1980 act contains no such exclusion S5 1980 Act repeals S12 1954 Act power to stay litigation pending arbitration and it doesnt exclude employment and industrial disputes from its scope. Does s5 1980 Act apply re employment and Industrial Relations disputes no-one is sure.

Arbitral Tribunal
Appointment of arbitrator, qualifications, remuneration, rights and duties. Termination of appointment. Commencing the reference.

It is a matter for the parties to decide when drawing up the arbitration agreement whether they wish to have one or more arbitrators. The general practice in Ireland is for clauses to provide for the appointment of 1 arbitrator. Appointment of an arbitrator(s) The arbitrator(s) can be appointed by a. the parties b. a third party, eg The Chairman of the Bar Council of Ireland c. the court It is very much in the claimants interest where a dispute arises and there is an agreement to arbitrate to ensure the arbitrator is appointed without dealy as:1 no orders can be made or procedural steps taken until the arbitrator has been appointed

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most claims must be made within certain time limits and failure to adhere to those limits could bar the claim although a party who succeeds at arbitration can be awarded their cost it is most unlikely the will get legal or other costs they incurred before the arbitration commenced

Usual procedure for constituting an arbitral tribunal Most arbitration clauses require the parties to try to agree on an arbitrator before any other method of appointing an arbitrator is adopted. Usually parties exchange the names of several likely arbitrators or their chosen nominating authority draws up a list of such names. These people are then approached informally to see if they are prepared to act. A person who has agreed in principle to act will then be appointed. Formerly a party to a dispute could easily frustrate an arbitration by refusing to make an appointment in circumstance where both parties agreement was required but the 1954 Act contains several provisions for making appointments in default of agreement or where the nominating authority does not act . Qualifications The law doesnt prescribe a set of qualification that a person must have before they can be appointed as an arbitrator. Generally speaking any person may be chosen if he has legal capacity. A person chosen by both or one of the parties or the nominating authority as the case may be is qualified to act. Many countries though have arbitration associations that train arbitrators eg the London based Chartered Institute of Arbitrators which has world wide membership including an Irish branch. Sometimes the agreement between the parties will stipulate certain qualifications that the arbitrator must have and thus only person with such qualifications can be appointed. The Arbitration rules of some institutions stipulate specific criteria and qualifications and accordingly if these rules apply to the Arbitration the Arbitrator appointed will have to meet the criteria and qualifications required. If a person has a financial interest in the subject matter of the dispute it must be disclosed to both sides and both sides must agree before the arbitrator can agree to act. Presumption in favour of a single arbitrator S14 of the 1954 Act raises a presumption in favour of a single arbitrator but the parties can of course agree to any number of arbitrators. An intention to have more than one arbitrator must be stated in the arbitration agreement or in a document to which it refers. The greater the number of arbitrators the greater the fees. Exceptionally the parties will have stipulated for 2 arbitrators S15 provides unless contrary intention is expressed that where there is provision for 2 arbitrators, each to be chosen by each side:a. if one arbitrator refuses to act, is incapable or dies, the party that has chosen him can choose again or b. if one party fails to choose an arbitrator, provided seven days prior notice is

served, the one appointed arbitrator can act as a sole arbitrator The normal practice is for the 2 arbitrators to take up the reference S16 deals with the situation where there are 2 arbitrators (in the absence of an expressed intention to the contrary) that is deemed to mean a reference to 2 arbitrators This does not amount to a 3 person tribunal or panel. Rather a decision should be made by the 2 Arbitrators, and if they are in disagreement, then by the umpire solely. S16(1) states that the arbitrators shall appoint an umpire immediately after they are appointed S16(2) states that if the arbitrators cannot agree the umpire can act as a sole arbitrator S16(3) the High Court upon application can appoint an umpire to act as sole arbitrator in lieu of the 2 arbitrators. S17 states that if there are 3 arbitrators the decision of any 2 is binding Appointment by agreement Where an arbitration agreement does not set out any method for appointment of arbitrator(s) then the parties must reach an agreement about who they will appoint. Most arbitration clauses require the parties to try to agree on an arbitrator before any other method of appointing an arbitrator is adopted. If the parties fail to agree then the procedure for appointment in default of agreement which is set out in the arbitration clause will have to be invoked (this may provide for the appointment by a third party) or failing that the court may make the appointment under S19(a) 1954 Act. There is no formality for an agreement of this kind but written confirmation is advisable. The selected arbitrator should also satisfy himself that he has been validly appointed and any stipulations in the arbitration agreement have been complied with Appointment by a third party Arbitration agreements can provide for appointment of the arbitrator by a third party e.g. The President of the Incorporated Law Society. If that person refuses or neglects to so do then there is no statutory power dealing with the situation.- S18(a) does not apply as is also the case where the arbitrator appointed by the third party refuses to act, is incapable of acting or dies. One must ask the nominating body to nominate another. (Same where arbitrator named in Agreement and he refuses to act, dies or is incapable) thus one usually expressly provide for such an eventuality. In those circumstances if a party commences litigation they can resist an application for a stay saying the agreement is inoperative. Appointment by the Court There are 5 circumstances where the arbitrator can be nominated by the court under s18 of the 1954 1 where the parties cannot agree on a sole arbitrator 2 where the arbitrator refuses to act, is incapable of acting or dies (save where the terms of the agreement provide for the filling of such a vacancy)

3 4 5

the parties or the arbitrators refuse to appoint a third arbitrator or umpire the umpire or third arbitrator refuses to act or is incapable of acting or dies. where all the arbitrators are removed by the Court S40(2)(i) of the 1954 Act gives the court a discretion to appoint a sole arbitrator.

What constitutes appointment? You must get agreement from arbitrator or your nominee in order for appointment to be effective. This is very important as time bar (Atlantic Shipping) Clauses often require an arbitrator be appointed within 3 months. The La Luna Denning LJ stated that for a valid appointment you must tell the other side of your intention to appoint and tell appointee and get intimation of appointees willingness to act as arbitrator.

Remuneration The main extra cost in arbitration that does not exist in litigation is the arbitrators fees and expenses, as litigants do not have to pay the Judges salary that is done by the government. Often the parties agree in advance to pay the arbitrators fee and expenses and what the amount of the fee will be or how it will be calculated. Sometimes parties dont agree the issue of the arbitrators fees until after he has accepted appointment. If payment is not made once the award is published the arbitrator is entitled to bring an action to recover the sum due. Save where it is otherwise expressly agreed the parties are jointly liable for the arbitrators fees and expenses. It is permissible for one party to agree to deal with the arbitrators fees as long as the other party is fully aware of the arrangement but once he accepts the appointment the arbitrator may not deal unilaterally with one party in repect to payment of any fee. How much the arbitrator is to be paid (ie quantum) is to be determined between him and those making the appointment. There is no set scale of fees. A lot depends on such things as the complexity of the dispute, the novelty of the issues to be decided, the degree of expertise required, the value of the property or the sum in issue, its importance to the parties, the location of the arbitration, the duration of the reference. Often it wont be practical at the outset to calculate what the fee will be but it is advisable that the parties should be told the methods which will be used to calculate it and preferably get their consent. Where for one reason or another a fixed sum is not appropriate the following are the

principal basis for calculating fees 1 A percentage of the amount at issue between the partie 2 A percentage of the mid-point between the amounts being claimed by both parties 3 A rate per hour, per day or per week which may differ depending on whether or not the tribunal is sitting. 4 A combination of some of the above When the quantum has not been agreed the arbitrator is entitled to be paid a reasonable amount which will depend on all the circumstances of the reference quantum meriuit idea. Commitment Fee Sometimes an arbitrator may not be sure when actually the reference will begin, how long it will last or what postponements will be required so if he agrees to accept the appointment he is then obliged to be available to hear the dispute thus requiring him to reject other work and thus arbitrator sometimes look for a commitment fee iepayment for making time available to deal with the reference eventhough the matter may not be at hearing during all or part of that time. It could though be technical misconduct for an arbitrator after accepting appointment to unilaterally seek a commitment fee from one of the parties as thus would lead to the appearance of bias. Generally any commitment fee should be agreed prior to appointment. Taxation of Costs In court actions where one seeks to challenge the amount of the lawyers fees the matter is sent for taxation to the Taxing Master in the High Court or to the County registrar in the Circuit Court. In arbitration the tribunal (arbitrators) fee are regarded as part of the costs and can be measured in the same way as legal fees by taxation. S29(1) of the 1954 Act allows an arbitrator tax the costs fo the reference including his own fees provided the parties agree. Where the arbitrator does not tax them they can be taxed similar to court costs by the Taxing Master of the High Court. If the parties agree to the arbitrator taxing costs and then one of them believes he has taxed them too high he cannot then send the matter to the Taxing Master his only redress is to challenge the award on ground sof misconduct that the arbitrator put his own interests before those of the parties or carried out taxation in an erroneous manner. Where the court finds errors or miscalculations it usually remits the matter back to the arbitrator to reconsider his taxation. In very serious situations the court can set the award aside in its entirety. Securing Payment Often arbitrators, before agreeing to commence the arbitration will insist that their fees are secured either by payment on account or bank guarantee or deposit with a stakeholder. If the arbitrator insists on having his fees paid before he hands over the award a party can pay the amount of the fees into court, pending taxation and is thus entitled to get the award.

Where the reference is under way it may be misconduct for the arbitrator to then start demanding security, it will depend on the circumstances, perhaps if the matter is not far advanced and it looks as if it will take longer than anticipated he may he just may be justified in looking for security on threat of resignation. One thing that is certain is that he can insist on security for any out of pocket expenses he must pay. Arbitrators have a lien over the award until they are paid what is due them i.e. he can refuse to hand over the award until he is paid. When a party believes what is being charged is excessive he can pay into court the sum claimed pending taxation and thus secures the award.

Rights Powers and duties Rights An arbitrators only right is to be paid the sum agreed or a reasonable remuneration and expenses Powers An arbitrator is appointed to determine a dispute that has arisen between the parties. Thus he must identify all the elements of the dispute and take all reasonable steps to conduct it in a fair and efficient manner having at all times regard to the wishes and interests of both parties. The arbitrators powers/jurisdiction is as a result of the consensus/agreement of the parties and his powers are circumscribed by the agreement of the parties. Subject to the terms of the arbitration agreement and the requirements of natural justice/fairness the arbitrator has a wide discretion as to how the arbitration is to be conducted In certain circumstances it is true that the Arbitration Acts give the Arbitrator certain powers but they are few and specific. There are 3 specific restrictions on the powers of an arbitrator (as per the agreement) 1 Parties cannot agree to do something which is contrary to public policy ie you cant agree to an arbitrator deciding matters public policy dictates should be decided elsewhere, e.g. a criminal law matter 2 Arbitrators are appointed by agreement of the parties and thus it is only they, their agents or benificiaries that can be bound by the award. Arbitration agreements or awards cant affect directly the rights of third parties. 3 Arbitrators cannot be given powers which are reserved for judges. The Common Law confers certain powers on arbitrators which are implied into the agreement of the parties (but they can be rebutted by contrary intention).

Where the agreement does not state the arbitrators powers he has a very wide discretion as to how the entire reference is to be conducted. Per Lord Diplock in Bremer Vulkan [1981] Ac 909 the parties make the arbitrator the master of the procedures to be followed in the arbitration. Apart from a few statutory requirements under the Arbitration Act --- he has a complete discretion to determine how the arbitration is to be conducted from the time of his appointment to the time of his award so long as the procedure he adopts does not offend the rules of natural justice This very extensive authority is founded on S1991) of the 1954 Act which states that in the absence of a contractual stipulation to the contrary the arbitrator is entitled to do all such other things which during the proceedings on the reference he may require Thus if parties do nothing more than agree to arbitrate then an arbitrator is deemed to have the following powers:- (as they assist the arbitrator in coming to a correct conclusion) 1 Require pleadings as arbitration is a cousin of litigation 2 Power to order discovery Kinsella v Timber Operators (1989) 3 Administration of interrogatories 4 Inspection of property 5 Power to order security for costs procedural tool. The implied power to order security for costs is limited to where the claimant/counter-claimant is a foreign party. Security for costs is generally ordered in litigation where the plaintiff is a foreign litigant or a limited liability company. Unicare Stearinerie is still accepted as authority that the power to order security for costs is not impliedly given in domestic arbitration. S22 1954 Act gives the Court power to order security for costs in arbitral proceedings. KS/AS Bani v Korean shipping (1987) 2 Lloyds 445 held that the express conferring of a power on an arbitrator to award security for costs is not exclusive of the courts power there are other factors to be considered (1) the nationality of the parties (2) the seat/country of arbitration (was it chosen specifically for its law) (3) whether the claims are elaborate or simple 6 The power of the arbitrator to rule on his own jurisdiction chicken and egg problem. There are basically 3 different instances where questions of jurisdiction arise:1 The arbitration agreement or the agreement in which it is contained is null and void. Who decides whether it is null and void the court or the arbitrator 2 Alleged disputes dont fall within the scope of the agreement 3 It is alleged that the arbitrator has no jurisdiction because of some public order requirement The English position till recently was that the arbitrator was incapable of determining any question of jurisdiction. That view has changed but not in relation to all of these 3 classes. The Irish position remains uncertain therefore we need to look at the

established English position. Joe Lee v Lord Dalmery it was held that if a challenge goes to the root of the arbitration agreement then the arbitrator is unable to determine the validity of the arbitration agreement. The contract was allegedly an illegal contract therefore the contract and the arbitration agreement therein were void ab initio and therefore the arbitrator had no jurisdiction. (See also Christopher Browne Case) Dalmia Daries v National Bank of Pakistan [1978] 2 Lloyds Rep 103 it was accepted that in English law an arbitrator cannot pronounce on his own jurisdiction, that being an issue for the courts. Heyman v Darwins (1942) Repudiation of an initially valid contract, The effect of repudiation is to treat the contract as over. The question was did the extinguishments of the contract between the parties also extinguish the arbitration agreement. The answer given was no the arbitration agreement is a mutual obligation which continues to oblige the parties to refer the dispute (ie the repudiation) to arbitration. The arbitration is a separate and distinct agreement.As the arbitration clause is severable from the main contract it allows the arbitrator to derive power from an independent arbitration contract to determine whether the main contract still exists essentially depends on the parties intention and the construction of the clause. (See note on scope of agreement)

The Arbitration Acts (in particular the 1954 Act) gives powers to the Arbitrator some of which can only be exercised on the direction of the court. (a) S19 of the 1954 Act gives specific powers to the arbitrator in the absence of any contrary provisions in the agreement Examination on oath or affirmation any of the parties Direct witnesses be examined on oath or affirmation That the arbitrator has power to administer oaths or take affirmations Making orders for discovery of documents against the parties To do all such other things during the proceedings as the arbitrator may require. It is quite a broad section. Because striking out for want of prosecution doe not facilitate determination of the dispute such power does not fall within s19(1). For the same reason there is no inherent authority to order 2 or more arbitrations be consolidated. The other sections may be seen as placing a limit on s19. (b) S23 1954 Act gives the arbitrator power to make an award at any time (c) S25 1954 Act gives the arbitrator power to make an interim award (d) S26 1980 gives the arbitrator the same power as the High Court to order specific performance of a contract save one relating to land or an interest in land

(e) S28 1954 Act gives the arbitrator the power to correct in an award any clerical error arising from any accidental slip or omission (f) S29 1954 Act gives the arbitrator power to make orders to and by whom costs of the reference and the award are to be paid, including with the consent of the parties power to tax or settle the amount of those costs. (g) S35 1954 act gives the arbitrator power to state any question of law arising in the course fo the reference or any award or any part of the award in the form of a special case for the decision of the High Court. ( If one of the parties in the course of the proceedings but before the publication of the award requests the arbitrator to state a case to the High Court on a point of law the arbitrator is obliged, in the absence of good reason to do so. Corporation of Dublin v McGinley (22/1/86) stated that a point of law without substance or which authority adequately covers would constitute good reasons for not stating a case. The arbitrator can only state a case on questions of law and not on questions of fact Mizen Hotel Company v Capwell Investments Ltd (30/7/81) (h) S17 of the Arbitration (International Commercial) Act 1998 amends s34 of the 1954 Act and gives the arbitrator power to award interest at whatever rate he feels meets the justice of the case on all or part of any amount awarded by him both up to the date of the award and from the date of the award to the date of actual payment. Supplemental powers of the Court Except where they are conferred by the agreement or under s19 arbitrators do not have the following powers but the court on application to it can give directions regarding the exercise of such powers in connection with the reference (s22) S22(1) (a) security for costs S22(1) (b) discovery and inspection of documents (c) giving evidence by affidavit (d) examination on oath of any witness before an officer of the court or any other person, and the issue of a commission or request of the examination of a witness outside the jurisdiction (e) the preservation, interim custody or sale of any goods which are the subject matter of the reference (f) securing the amount in dispute in the reference (g) the detention, preservation or inspection of any property or thing which is the subject of the reference or as to which any question may arise therein and authorising for any of the purposes aforesaid any person to enter upon or in any land or building in the possession of any party to the reference or authorising any samples to be taken or any observations to be made or experiment to be tried which may be necessary or expedient for the purpose of obtaining full information or evidence and (h) interim injunctions or appointment of a receiver It doesnt conflict with s19 because the latter is specifically against the parties.

S22 specifically provides that the fact the High court is given these specific powers is not to be taken to prejudice any power which may be vested in an arbitrator of making such orders. Duties of the Arbitrator 1 Proceed with reasonable dispatch with the reference The speed with which the matter must be dealt with depends on the circumstances of the case. S24 authorises the courts to remove arbitrators who fail to use reasonable dispatch in entering on, proceeding with the reference and making an award and the arbitrator so removed is not entitle to remuneration for his services but neither would it appear that the parties could recover damages for excessive delay of the arbitrator. 2 Exercise reasonable care in the conduct of the reference immunity from suit Arbitrators must carry out their function in a careful and responsible manner. Failure to do so may equal misconduct allowing the court to remove the arbitrator or set aside the award ss37 and 38 1954 Act Though it would appear that the arbitrator cannot be held liable in negligence for any loss caused by his negligence In Sutcliffe v Thackrah [1974] AC 727 where the defendant, an architect hired to certify work under a building contract, unsuccessfully claimed the immunity on the grounds that he was a quasi arbitrator. Lord Reid said An action will not lie against an arbitrator for want of skill or for negligence in making his award. The reason for this may be that the public interest does not make it necessary for the courts to exercise greater powers over arbitrators than those which they possess, such as the power of removing for misconduct or of correcting errors of law which appear on the face of an award. Furthermore as a matter of public policy it has been thought to be undesirable to allow an action against an arbitrator (for lack of care or skill) for the reason that his functions are of a judicial nature. Arenson v Arenson [1977] AC 405 where an accountant hired to value shares in a company was sued for negligence there some of the Law Lords suggested not all arbitrators enjoyed immunity from suit. Essentially this is a question of public policy. Judges immunity stems from the constitution and crown prerogatives Deighan v Ireland [1995] ILRM 88 State cant be fixed with liability for negligence of a Judge ie Sirros v Moore is the law here. Arbitrators are like judges but there are significant differences between them most notably that as a condition of appointment the arbitrator can stipulate he will not be held liable in negligence. Hedley Byrne v Heller where parties in relationship where hold out they possess a skill and the other party relies upon it they owe a duty of care, but

said duty of care may be contracted out of. Jones v Dept of Employment [1988] 2 WLR 493 re negligence resulting in exclusive financial loss suggests that persons exercising an adjudicative function will not be held liable for reasons of public policy. The model rules of the Irish Branch of the Chartered Institute of Arbitrators purport to exclude all liability in negligence. 3 Act impartially The general principle nemo iudex in causa sua applies to arbitrators principle against bias justice must not merely be done but must be seen to be done. Thus the arbitrator cannot be bribed or even place himself in a situation where it appears he is biased (apparent bias). The test per Blayney J in Bord na Mona v Sisk Unrep HCT May 31, 1990 Is whether a right minded person with full knowledge of the facts would have been led to conclude there was a real likelihood of bias In that case the arbitrator had provided professional services to the respondents (a property developer) associate building company. It was held there was no real likelihood of bias. If the arbitrator has a shareholding in one of the parties he should disclose that even where such a shareholding is unlikely to affect his decision. The arbitrator should not be connected to the subject matter of the reference as this too against his impartiality. Bias in conduct of the reference The arbitrator must not have undue contact with one of the parties. Re Briens Arbitration [1910] 2 IR 84 -arbitrators were appointed to value the land, which the parties had worked in partnership, and to determine which of them should have first offer to purchase the land. Under the procedure agreed by the parties each arbitrator was to make a separate valuation of the farm on behalf of the party whom he represented. One of the arbitrators viewed the farm accompanied by the party who had appointed him but was not accompanied by the other party. Said action was held to be contrary to all principles of justice and fair play and amounted to misconduct. Boyd J stated that arbitrators must not be guilty of any act which can possibly be construed as indicative of partiality or unfairness. It is not a question of the effect which misconduct on their part had in fact upon the result of the proceedings, but of what effect it might possibly have produced. what we are talking about is the appearance of bias. State(Hegarty) v Winters [1956] IR 320 There the arbitrator visited the property that was the subject of the reference accompanied by an employee of one of the parties. That was held to reasonably give rise in the mind of an unprejudiced onlooker to the suspicion that justice was not being done. The award was set aside on the grounds of the arbitrators misconduct. In Childers Heights Housing Ltd v Molderings [1987] ILRM 47

The arbitrator expressed a wish to view the site on her own and neither party raised any objection . It was held her going to view the site on her own was not misconduct. Tobin and Twomey Services Ltd v Kerry Foods Ltd [1999] 3 IR 483 The High Court confirmed that the courts discretion to remove an arbitrator is likely to be confined to cases where the arbitration cannot continue with the particular arbitrator in office either because he had shown actual or potential bias, or his conduct had given serious grounds for destroying the confidence of one or both of the parties in his ability to conduct the dispute judicially or competently. Redress for bias The 1954 Act provides for the sanctioning of bias or breach of the nemo iudex principle. Actual bias can justify the court setting aside the award or revoking the authority of the arbitrator as well as the arbitrator being denied his fee and possibly his out of pocket expenses. If the arbitrator has been found to be in collusion with a party or otherwise corrupt the court can make him liable for the costs fo the arbitration. Where a party is aggrieved because of bias then must generally make their objections known at the earliest possible opportunity or they may be regarded as having waived that objection. S39 provides an exception to that principle where the objection is that the arbitrator has a relationship with a party or with the subject of the reference and the objecting party was aware or should have been aware of that relationship at the time he entered into the arbitration agreement and the arbitration was named or designated in that agreement. Breach by the arbitrator of these duties could lead to the revocation of his powers and the award being set aside. Arbitrators generally are not liable for negligence but I suppose one could simply refuse to pay the fees and cite negligence in a defence to a claim for same by the arbitrator. (See Forde Arbitration Law and Procedure)

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Termination of Appointment

1 2 3 4 5

Once an arbitrator publishes his award he is functus officio in respect of the reference. Arbitrators may resign (though that may render them liable to the parties for breach of contract) An arbitrators authority may be revoked by the parties or by court An arbitrator may be removed by court Replacement by the parties expressly or per s15 or by the court

(3) Revocation of authority The parties are restricted by legislation from removing an arbitrator once appointed this is to prevent parties removing an arbitrator to subvert arbitration. S9 1954 Act provides that the authority of the Arbitrator/umpire appointed by virtue of an arbitration agreement shall unless there is a contrary intention expressed in the arbitration agreement be irrevocable unless one obtains the leave of the court. S9 provides 2 ways an arbitrators authority can be revoked 1 Where a contrary intention is expressed in the arbitration agreement ( ie that his authority is not irrevocable)then the authority can be revoked by any party including an appointing body. 2 The court can give leave to revoke the authority Frofa National De Peterteires Lord Denning stated that the power to revoke where leave is given may only be exercised against an arbitrator upon whom authority had been conferred by the revoking party (ie you cant get leave to revoke other sides arbitrator revocation can only be made by those who gave the authority in the 1st place.) Where the arbitrator is a sole arbitrator therefore both sides will have conferred authority on him. S9 also applies where a sole arbitrator was appointed by an appointing body. What factors should the court take into account in giving leave ( none are listed in the section) It has been held that the court should exercise the jurisdiction to give leave to revoke the arbitrators authority most sparingly and with caution Den of Airlie SS Co v Mitsui & Co (1912) 106 LT 451 Mustill J in Sucula Ltd called it a power of last resort. What circumstance is revocation of authority under s9 more appropriate than removal under other sections? A number of obvious lines have been put forward 1 Serious/irreparable conduct by arbitrator would be ground sfor removal under s9 but the Arbitration Act already provides for removal on ground of misconduct per S37 2 Actual/potential bias good ground for invoking s9 but it is also misconduct ad therefore within S37 3 Deficiencies of capability of arbitrator for which the act provides no remedy would be good grounds for removal under s9- agins though these could be seen as misconduct under s37

Thus the grounds for exercising the courts discretion to give leave under s9 are very narrow. SS Dean of Airlie v Nitsui and City Centre Properties v Mathew Hall the Court of appeal in England held it would not exercise its jurisdiction under the English equivalent of s9 unless to do anything else would lead to injustice. If the court gives leave to revoke authority it has no power to order a stay. Obtaining the courts leave does not automatically result in the arbitrators removal it is then for the applicant to make that decision. (4) An arbitrator may be removed by the courtfailure to use reasonable despatch and misconduct S24 the high court can remove an arbitrator or umpire and he shall not be entitled to remuneration if he has failed to use all reasonable despatch. Louis Emmanuel v Sammut Dealy of 4 months in production of award after conclusion of a short hearing arbitrator gotten rid of. The law has established that failure to use reasonable despatch must be the only cause of the delay, if something else is the cause eg misconduct then the appropriate application is under s37 Pratt v Swanmore The arbitrator failed to get the arbitration in motion within a reasonable time as he failed to show the competence one would expect of someone in his shoes. One party sought his removal on 2 grounds failure to show reasonable despatch and misconduct. Held failure of competence s37 therefore he gets his remuneration. S37 the High Court can remove an arbitrator for misconduct (In such circumstances the award can be set aside if improperly procured s38) Pratt v Swanmore what is misconduct Pain J Having regard to an arbitrators conduct it would be unfair to leave the arbitration in that arbitrators hands. The idea being that there is no reasonably prospect of justice being done if the arbitration is let continue. Misconduct does not require moral turpitude. No degree of intention is necessary. It is purely procedural. Re Enoch & Zaretzy Would it be fair and just to leave the rights of the parties in the arbitrators hands if not then misconduct. Modern Engineering case Issue related to an architects cert ie he certifies that the costs put in by the contractor are reasonable in relation to the work done -. Normally an architects cert is deemed final re costs. Claimant made an opening submission and the arbitrator on foot of this made an interim

award before the defence had made a submission. This was a reach of natural justice audi alteram partem. 2 sets of relief sought - removal of the arbitrator and setting aside of the award. Goff J set aside the award but refused to remove the arbitrator stating that there were varying degrees of misconduct and the misconduct which resulted in the setting aside of an award was less serious than that needed to remove the arbitrator The Court of Appeal overturned the decision not to remove the arbitrator but did not devalue the proposition that there are varying degrees of misconduct and the most serious being required for the removal of an arbitrator. Dunne and Denning LJJs focused on the confidence of the parties. Irish cases there is a focus on the possibility of justice not being done. Examples of misconduct 1 Visiting the property the subject matter of the dispute accompanied by the employee of one of the parties (State(Hegarty) v Winters [1956} IR 320 (reasonable suspicion of bias) 2 Not hearing relevant evidence OSullivan v Joseph Woodward & Co [1987] IR 255 3 Not affording parties the opportunity to make submissions on a relevant point. Geraghty v Rohan Industrial Estates Ltd [1988] IR 419 4 Lacking of elementary skill to conduct the arbitration = misconduct (Pratt v Swanmore no breach of the rules of natural justice save that no-one could conceivea justi outcome from the way the arbitrator was conducting the arbitration) 5 Misconduct to enforce an award which deals with an illegal contract David Taylor v Burnett contract re controlled substances held unenforceable on basis it related to an illegal contract. Please note that error of law or fact on the face of the record is not misconduct, neither is refusing to state a case to the High Court (Stillorgan Orchardv McLoughlin & Harvey [1978] ILRM 128)

S15(2) B the court is given the power to setting aside any appointment in S15(2) A (S15(2) A is not very commonly relied upon.

S39 provides for the revocation of the arbitrators authority by the high court where:1 the arbitrator is not/may not be impartial or 2 there are allegations of fraud. S39(2) applies only to agreements to arbitrate future disputes, ad hoc submissions of an existing dispute involving accusations of fraud are not affected by the section.

The ordinary rule of estoppel does not apply to s39 thus where a party seeking relief under s39 knew or ought to known the arbitrators relationship with the other party or connection to the subject matter of the dispute it will not be a ground for refusing the application. (though estoppel will operate in other case of removal just not per s39) See cases cited above under duty to act impartially State(Heagarty) v Winters etc (pages 23 and 24) What do we mean by fraud it usually involves deceit, making a false statement. The courts power in circumstances where fraud is alleged is discretionary. Generally per Forde where the party accused of fraud wants the matter litigated it will be but if he is happy to have the matter dealt with by arbitration the courts will be inclined to let that happen, but it all depends on the circumstances of the case and the nature of the fraud. There is a public interest in an open trial for certain allegations of fraud. Administratia Asigurarilor de Stat v Insurance Corp of Ireland [1990] ILRM 159 This concerned a dispute between an insurance company and a re-insurance company concerning a large amount of money. The plaintiffs sought to repudiate their contracts and claimed that the defendants insurance arrangements had been of a fraudulent nature . The plaintiffs alleged fraud abd sought to have the arbitration agreement set aside and issueda summons and draft statement of claim. The defednats sought a stay under s5 1980. OHanlon J stated that the courts discretion under s39(2) was broad. He rejected the contention that one had to establish a prima facie case of fraud and stated it suffices if the allegations of fraud are made with perfect bona fides ie are not sham or frivolous or put down with the intention of placing an obstacle in the way of arbitration. In that case a prima facie case was made out and the claim was extremely complex and it was felt that a hearing in the High Court with an appeal to the Supreme Court was preferable in dealing with difficult issues of law, (5) Replacement The replacement of an arbitrator may be made by 1 the parties expressly or under s15 Thus the parties can do so by agreement There is a statutory provision in s15 of the 1954 act for the replacement of an arbitrator in a 2 arbitrator arbitration where he refuse, dies or is incapable the breach can be filled. As parties can agree to fill the breach they can also agree that the appointing body can fill the breach. 2 the court under (i) S18 or (ii) S40 following the removal of an arbitrator or umpire by the court.

Commencing the reference

Before an arbitration can commence, a dispute must have arisen between the parties. What happens next depends on the terms of the arbitration agreement The formal commencement of the reference to arbitration is when the notice is sent for the appointment of an arbitrator. It could be sent to;1 the other party to appoint his arbitrator or to concur in the appointment of an arbitrator 2 or to the appointing authority nominated in the agreement Before accepting the position an arbitrator may negotiate his remuneration and obtain security for payment. He will then consider whether his appointment was valid. (he will look at the agreement and the dispute and subject to what I have already stated in certain circumstances he can decided whether he has jurisdiction to proceed save where it is alleged there was never an enforceable agreement for arbitration or if hi jurisdiction is founded on the existence of certain facts and they are in dispute or commenced later that the prescribed time (atlantic shipping clause))

Procedures to be followed
How arbitration is conducted depends on what procedure is agreed by the parties. The advantage of Arbitrations is that it doesnt have to be bound by court procedures and thus procedures in Arbitrations range from being extremely formal to extremely informal depending on the dispute and the agreement of the parties. There are what is called touch-sniff arbitrations in the London Commodity trade whereby the arbitrator simply examines a sample of the commodity and then gives his decision. There can be documents only arbitrations- no witnesses no hearing arbitration determined on the basis of written submissions made. This is often done with respect to small claims. This could involve substantial savings in costs. The general rule is that if all parties wish to proceed by way of written submissions only then the arbitrator should accede to the request but if any party objects then an oral hearing should be held.

Even the most informal of procedures must adhere to natural justice requirements though. (fair procedures ) It is usual that procedures would be agreed in advance of the reference to arbitration eg the arbitration agreement may incorporate model procedures, those of the Chartered Institute of Arbitrators for example. If it is to be conducted in a formal manner arrangements will be made for the exchange of pleadings ( points of claim and defence), discovery and inspection of documents and what type of evidence may be given (written only (documents) or written and oral and whether the rules of evidence apply as if it was a court). Otherwise it could be quite informal. Some arbitrators insist on certain procedural requirements before accepting appointment as arbitrator. If the arbitration procedure is agreed in advance by the parties then the arbitrator is bound to follow in London Export v Jubilee Coffee Sometimes the procedure is agreed by the parties in conjunction with the arbitrator so as to find a procedure that best suits the dispute. The arbitrator is not strictly bound by a procedure adopted after appointment but at a minimum the arbitrator if proposing to deviate from this procedure should notify the parties and if both sides object then the original procedure should be followed. Any agreed procedure cannot contravene public policy and the courts will not allow the parties contract out of the supervisory powers of the High Court. McLeod v Craddock (1954) and Czarnikov v Roth Smidt & Co Ltd (July 1992) The parties had agreed to contract out of the case stated procedure. The court held that the parties agreed procedure was contrary to public policy because it ousted the jurisdiction of the court. There must be no alsatia in England where the Kings writ does not run. (Alsatia was the name of a slum, the police were afraid to go into) Where no procedure has been agreed the tribunal has a wide discretion to deal with the reference to arbitration appropriately but again subject to the rules of natural justice and fair procedures. Natural Justice and fair procedures requirements The principles nemo iudex in causa sua and audi alteram partem are the essence of fair procedures. Nemo iudex requires that the arbitrator is neither actual biased nor appears to be biased (ie he doesnt act in an apparently biased manner), the procedure is fair and not biased. Audi alteram partem requires that each party is given an equal opportunity to present their case, ie sufficient notice of the date and place of the hearing, an opportunity to present their evidence and make submissions and contradict the evidence of the other party. Chilton v Saga Holdings [1986] 1 AER 841 held that refusing to allow a party cross-examine the other partys witness is a ground for removing the arbitrator. Re Enoch & Zaretzky (Eng) An arbitrator called some witnesses of his own and he refused to hear the evidence of witnesses of one of the parties. Held to be a clear breach of natural justice.

We have just seen that the parties can choose the procedures to be adopted they can also choose what law should be applied. The law to be applied There are a number of circumstance where bodies of law can apply to arbitration 1 The Law of the contract that governs a contractual dispute in relation to that contract ie disputes as to the obligations contained in that contract. If the dispute is as to the terms of the contract then the law fob the contract is the law of the dispute. The law of the contract can also be the law of the arbitration agreement but it need not be so. 2 The Law of the arbitration Agreement this covers the jurisidiction of the arbitrator as the jurisdiction of the arbitrator is determined by reference to the arbitration agreement. You interpret the scope fo the arbitration agreement by reference to the law of the agreement. Time bar clauses and the validity of the arbitration agreement are interpreted in accordance with the law of the arbitration agreement. 3 The Law of Procedure this relates to the procedures to be followed, the evidence (what constitutes evidence), the appointment and removal of the arbitrator. In the absence of a contractual provision to the contrary the general proposition is that the law of the place of the arbitration lex loci arbitri 4 The law governing the dispute if contractual then it is the law fo the contract, if tortuous then it is whatever law governs that tort Is it Irish or French Tort law and that is determined by the conflict of law rules under the procedural law. 5 The Law governing enforcement and recognition is usually the law of the place where you want to enforce the award. Whitworth Estates v Miller (1970) There was a contract between an English and a Scottish company to conduct conversion work on the English companys property in Scotland. The contract was negotiated and concluded in Scotland, it had an arbitration clause referring to arbitration in accordance with the rules of RIBA and the contract also stated that this is a submission to arbitration within the meaning of the Arbitration Act 1950. A Scottish arbitrator was appointed and Scottish procedure followed. Order made in the Scottish form and a Scottish counsel employed. After the evidence was heard in the arbitration the English party sought a case stated in the English High Court regarding the Arbitration Act 1950 (the English Act). The question for the court was what rules of procedural law applies Scottish or English? Surely strong reasons for it to be Scottish Law as the whole thing was in Scotland contract etc. The House of Lords held that this was a Scottish arbitration and the procedural law was Scottish law but the law governing the dispute was English law (submission to arbitration within the meaning of the 1950 Act). Follow Scots procedure but apply English law in determining the merits (ie who should win). Thus arbitration in Scotland could be conducted under the 1950 English Act. In each case it is a question for the court of the land will they allow arbitration to take place within

their jurisdiction but without their supervision. _____________________________________________________________________

Pre-hearing issues
Prelim meeting Statute of limitations/time bars Defining the issues Discovery and Inspection Agreeing evidence/documents/written proofs/listing rules Interim protection orders Security for costs Settlement Delays and Defaults Pre-hearing review Preliminary meeting Usually the parties and the arbitrators will meet for a preliminary meeting especially where the dispute is complex. The preliminary meeting should be convened by the arbitrator as soon as possible after his appointment. The preliminary meeting allows the arbitrator to get a picture of the dispute and an idea about how best to conduct the reference so as to achieve the resolution of the dispute in the most efficient and economical way . On this the arbitrator should seek to get the agreement of the parties but in the absence of agreement he is fully empowered to fix the procedure subject to any special provisions in the arbitration agreement and subject to the principles of natural justice. The purpose of this meeting is generally to consider the issues and the procedures to be followed. Where and when the hearing will take place When and how points of claim and defence and any replies will be exchanged. What evidence will be admitted - Whether there will be an exchange of written proofs of evidence and when and how they should be exchanged. Application for interim protection orders Security for costs

There may be subsequent follow up meetings to deal with any additional matters and in very formal arbitrations a pre-hearing review. The following is a list of items dealt with at the preliminary meeting unless the arbitration agreement has itself clarified them (1) Review of arbitration clause (2) Check any preconditions to be complied with before commencement of arbitration (3) Validity of appointment (4) The arbitrators appointment and remuneration (generally before an arbitrator will agree to proceed with the arbitration he will require one or preferably both of the parties to sign a Form of appointment of arbitrator this gives him a contractual right to recover his fees otherwise he could be left high and dry) (5) Identification of the parties (6) Defining the issues subject of the dispute, counterclaim any preliminary matters - providing for pleadings, points of claim or defence or allowing existing documents stand as pleadings times for taking various steps. (7) Representation of the parties and whether counsel are to be involved. (8) Rules of procedure -Evidence is the arbitrator to be bound by the strict rules of evidence what about expert witnesses witnesses of fact extent to which reports can be exchanged and agreed (9) Any preliminary issues to be determined (10) Pleadings Points of claims Points of Defence and counterclaim if any Points of reply and defence to counterclaim Reply to defence to counterclaim Close of pleadings (10) Discovery Whether necessary, when and to what extent (11) Hearing-whether one is needed or will it be a documents only arbitration. If there is to be a hearing where should it be held duration provisional date -need for transcript -Should all the issues be heard at once or should they be split and interim awards made.-arrangements to be made and who is to be responsible for them (10)Inspection Whether there is a need to inspect any property or items involved in the dispute if so the date of inspections, the arrangements to be made, the persons to be present. (11)Are the arbitrators existing powers adequate to deal with any problems likely to arise (12)Is any major question of law likely to arise? Should a legal assessor be appointed or a case be stated to the High Court (13)Award the need for an interim award the final award the procedure to be observed in relation to a sealed offer. (14) Find out whether the parties wish the arbitrator to tax the costs he may award. Basis of arbitrators costs tiem and method of payment joint and several liability. (15) General Directions a All communications by any party to the arbitrator (save for the purpose

of fixing dates) to be simultaneously copied to the other party and to be noted on the correspondence accordingly; b exhibits, photographs and plans to be agreed where possible c reports and other evidence to be agreed where possible. d figures to be agreed where possible e. what documents are to be submitted to the arbitrator and when f. liberty to apply (16) Any other business. (See Law Society sample agenda in handout) Immediately after the preliminary meeting the arbitrator will normally issue an order for direction that will encompass formal directions from the arbitrator on the future conduct of the arbitration process by what has been fixed or agreed at the preliminary meeting. ___________________________________________________________________

Limitation Periods The Statute of Limitations 1957 applies to arbitrations as it applies to actions in court. An arbitrator may not be able to proceed with the reference as the matter is time barred either by a clause in the arbitration agreement or by the Statute of Limitations 1957. (Claims for breach of contract must be brought within 6 years) Statute of Limitations 1957 Part IV applies its provisions and the provisions of any other legislation on limitations to arbitration (s75) S74 deems an arbitration to have commenced When one party to the arbitration agreement serves on the other party or parties a written notice requiring him or them to appoint or concur in appointing an arbitrator or where the arbitration agreement provides that the reference shall be to a person named or designated. As stated earlier in respect of time bar clauses the High Court under S45 of the 1954 Act can extend any time limit for such period as it deems proper if in the circumstances of the case undue hardship would otherwise be called. Walsh v Shield Insurance quoted supra where an extension of time was granted though there was significant delay in commencing arbitration but the other side were held not to have been prejudiced by the delay. _____________________________________________________________________ Defining the issues Before one can embark on solving a dispute the issues need to be clarified what is agreed what is disputed.

There can be written statements of case or alternatively pleadings points of claim and points of defence and perhaps further particulars of both. Notices to admit facts used where time consuming and expensive to prove facts ask other side to admit them or bear the cost of you having to prove them Interrogatories series of questions with a yes or no answer Amending pleadings tribunals have a discretion to allow amendments of pleadings. Discovery and Inspection of documents. In court before trial a party may get an order that the other side discover and allow inspection of all relevant documents in their power. Possession or procurement. Evidence What about evidence is the arbitrator bound by the strict rules of evidence required by courts? Will the hearsay rule apply this greatly affects how documents can be admitted into evidence. Generally except where the parties otherwise agree the arbitrator is bound by the rules of evidence. The McPherson Train case showed that there can be an express agreement to depart from the strict rules of evidence The Henry Bath case stated that agreement to depart from strict rules of evidence could even be implied ( from the wording of the submission to arbitration and perhaps the conduct of the parties). In that case the particulars of the claim in dispute were delivered on the morning of the hearing claim that the warehouse man for the respondents had inspected the goods and found them satisfactory. The respondent contacted the warehouse man and he sent a telegram stating that he had not seen nor supervised the unloading of the goods in question. The telegram was admitted into evidence and the award made. There was an action to set aside the award on the basis that it was given on inadmissible evidence. The action was dismissed as the parties had agreed to allow the arbitrator act on documents or copy documents presented to him without anyone being required to support the allegations of fact. The WN Lindsay case states that very clear words are required to give an arbitrator power to exclude what would otherwise be admissible evidence. The courts will lookat the words carefully and construe them strictly. If there is a dispute about admissibility of evidence then a case stated can be sent to the High Court better to do that than go ahead and have the award set aside later. What about where the arbitrator is an expert can he use his own expertise? To what extent can an arbitrator who is an expert in his field rely on his own expertise? Eads v Williams Arbitrators appointed to settle a rent dispute regarding a cola mine both arbitrators were familiar with the property in question so they didnt have to go and inspect it and there were certain witnesses they didnt examine. The Court held they had not misconducted themselves and that where a matter is referred to an arbitrator for his expertise therefore you expect him to use it. (That statement must be reading light fo natural justice requirements though). The modern view is contained in Thomas Bothwick, Fox and The Radoute case which state

that where an expert arbitrator seeks to rely on his experience or expertise he must put that to the parties. It is misconduct for him to rely on his own experience in contentious issues without giving the parties an opportunity to controvert it. Agreeing evidence/documents you agree that the document is evidence or merely that it is authentic. Sometimes a written summary of the evidence of expert witness may be provided (High Court disclosure rules in PI cases requires the disclosure of expert reports prior to hearing. Interim protection orders Occasionally the safety or existence of the subject matter of the dispute may be in jeopardy or there is a risk evidence might be destroyed n litigation the court has extensive powers to protect by way of injunction. Save where the arbitrtion agreement specifically provides for it the making of an interim protection order does not fall within an arbitrators usual authority but a party can apply to court under s22 for a protection order, (property should be taken into custody or money paid into a bank account and frozen) Security for costs Generally you win a court case, you get costs, in certain circumstances you may fear even if you win you wont be paid your costs as perhaps the other side is not a mark or may have dissipated assets and thus you seek an order for security for costs before the hearing to ensure that in the event of you securing a costs order it will be met. Generally granted where opponent a limited liability company or resident abroad. Unless an arbitration agreement specifically provides for it an arbitrator doesnt have the authority to make such an order but an application can be made to the court under s22. Generally the court wont order it where the arbitration is on documents only merely because the claimant resides abroad. Settlement Ordinarily offers of settlement are made before the hearing takes place. There are generally 3 types of settlement offers 1 An open offer 2 An offer without prejudice 3 An offer without prejudice save as to costs. Usually the offer is either in the form of 2 or 3 above. Problem with an open offer once the tribunal knows of it the danger is it will be influenced by it. The tribunal wont know of a without prejudice offer. Only at the stage where costs are being argued will the tribunal be aware of the nature of an offer without prejudice save as to costs. So that it can be taken into account is deciding the matter of costs, in these circumstances the offer is normally communicated to the arbitrator

in a sealed envelope prior to the conclusion of the arbitration hearing. In case it influences his decision the arbitrator should not open the sealed envelope until he has made his award on the substantive issue in dispute. The arbitrator will then make his award on costs having regard to whether or not the amount of the offer exceeds the amount of the award. A sealed offer without prejudice save as to costs is known as a caulderbank offer. When a party makes an offer of settlement to the other side generally it is deemed to include an offer to pay all of that sides costs up to the date of the offer. It is better though if the offer specifically deals with the entire question of costs including the arbitrators remuneration. A reasonable time should be given to the offeree to consider accepting the settlement. Here a partys offer is accepted the dispute is settled. The settlement may take the form of an agreement between the parties, if so it is then enforceable as a contract. Sometimes the parties seek to have an award made by the tribunal in the terms of the settlement thus rendering it enforceable as an arbitral award. Generally arbitrators are functus oficio once the dispute is settled and thus if the parties want the settlement to be made part of an award they must have conferred authority on the arbitrator to do so. Delays and Defaults One of the advantages of arbitration is speed Where there is delay on the respondents part the arbitrator if requested to do so can take steps to speed matters up. Arbitrators cannot make awards in default of action of one side unlike courts but an arbitrator can fix a date for hearing, notify the respondent and proceed to hear the matter on that date. The respondent may seek an adjournment which the arbitrator may grant on strict terms. Where the claimant delays the arbitrator on request of the other side can fix a time within directions must be complied with and set a date for hearing. In Grangeford Structures Ltd ( in liquidation) v SH Ltd [1990] ILRM 277 it was held that an arbitrator is entitled to proceed with a hearing without one of the parties being in attendance if the arbitrator has given that party a reasonable opportunity to attend. Pre-hearing review If there is going to be a hearing the arbitrator may well decide, unless the arbitration is very straightforward, to hold a pre-hearing review with the parties or their representatives when the pleadings have closed. The purpose of this being the following:1 to check whether all of the directions given at the preliminary meeting have been complied with and whether any further directions are required eg additional discovery 2 to review the issues in dispute and encourage the parties, where possible. to agree figures, documents, photographs, plans or other exhibits with a view o avoiding unnecessary proofs at the hearing 3 to review and fix the format of the arbitration hearing, what issues will be dealt with first, what witness will be heard first

4 5

to check that the facilities and other requirements necessary for the proper conduct of the arbitration hearing are in order. Arrange that a list of the issues and the necessary bundles of documents are given to the arbitrator in sufficient time to read them before the hearing commences.

The Arbitration Hearing

A significant amount of arbitrations are conducted without an adversarial hearing taking place by inspecting the goods in a quality dispute or a documents only arbitration. When all the pleadings have been exchanged and any pre-hearing review has taken place, the arbitrator in consultation with the parties will set a mutually convenient date, time and place for the hearing. If this cannot be agreed with the parties he may set it himself though he must have regard to any reasonable representations made by any of the parties. The hearing must be conducted in accordance with the arbitration agreement and the rules of natural justice. He has full power to decide the how the case will be heard and the procedure to be followed subject to the arbitration agreement and any agreement made at the preliminary meeting and of course natural justice requirements. Thus each party must be treated fairly and be given an equal opportunity to be heard and to controvert their opponents case.

According to Mustill and Boyd the following are the minimum requirements of a hearing 1 Notice of hearing each party must have notice that the hearing is to take place. It is the arbitrators responsibility to ensure that the parties are properly notified to avoid any misunderstanding 2 Opportunity to attend each party must have a reasonable opportunity to be present at the hearing together with their advisers and witnesses. The arbitrator will seek to convenience the parties within limits. The arbitrator must balance the legitimate interests of each party against the general purpose of the arbitration which is to provide a speedy method in resolving disputes 3 Each party must have the opportunity to be present throughout the entire hearing 4 Each party must have a reasonable opportunity to present evidence and argument in support of his own case 5 Each party must have a reasonable opportunity to test his opponents case by cross-examining witnesses, presenting and rebutting evidence and addressing oral argument. 6 In particular, unless there is agreement to the contrary, the arbitrator should not hear evidence in the absence of one party, and generally should not take the evidence himself in the absence of the 2 parties. The type of the arbitration and the general understanding of how formal or otherwise it is supposed to be will indicate the parameters of this right to contradict the other partys case 7 Unless otherwise expressly agreed the parties must present the whole of their evidence and their entire argument at the hearing In Grangeford Structures Ltd ( in liquidation) v SH Ltd [1990] ILRM 277 it was held that an arbitrator is entitled to proceed with a hearing without one of the parties being in attendance if the arbitrator has given that party a reasonable opportunity to attend. That was a building dispute and the arbitrator had given various directions which were not carried out by the respondent and there were many delays on the respondents part. Approx 1 year after his appointment the arbitrator fixed a day for hearing. On the hearing day the respondent sought an adjournment which was made peremptory until the afternoon. When the tribunal insisted on going ahead with the reference th respondent objected and left. The tribunal then heard evidence ex parte and made an award in favour of the claimant. It was held that the arbitrator had not acted improperly in the circumstances Also the entire matter must be dealt with in private, preliminary meeting, hearing and publication of award. Usually there are 2 main issues liability ( and if found liable) the amount of compensation to be paid then there is the matter of costs. Order of events The conduct of the hearing can be informal or akin to a court hearing. If the latter then it would usually be as follows:Opening on behalf of the claimant (this could be brief if there is a comprehensive statement

of the case before the Arbitrator) The claimants witnesses will then give their evidence (in response to questions from the claimants lawyer). They are then cross-examined by the lawyer on behalf of the respondent. They then may be re-examined by the claimants lawyers (questions in reexamination are confined to matters that arose in cross-examination). As the procedure is adversarial in nature the arbitrator should refrain from interfering as much as possible, but can intervene to prevent bullying of a witness. The respondents lawyer will then present his case ( examination cross-examination of witness etc) Final submissions will then be made. The arbitrator may seek clarification of various points during these final submissions. Where issues of law arise and the arbitrator does not have legal experience he may decide to state a case to the High Court or with the agreement of the parties appoint a legal assessor to advise the arbitrator Ultimately the arbitrator makes a decision. Rules of evidence See previous comments on evidence One of the main issues in arbitrations is the application of the hearsay rule to documents and proving the origin and contents. Witnesses Where a witness refuses to attend and give evidence at the hearing , a party to the arbitration can obtain a subpoena from the court under s20 1954 Act ( ad testificandum or duces tecum) Privilege against self-incrimination Forde says presumably this privilege applies as it does under litigation.

The Award
The decision of the arbitrator is called an award and it resembles the order of a court on deciding a case. Similar to a court giving a reasoned judgment the arbitrator can set out the reasons for his decision. There are 2 kinds of awards Interim Final Sec 25 of the 1954 Act provides that unless a contrary intention is expressed in the arbitration agreement the arbitration agreement shall be deemed to contain a provision that the arbitrator may, if he thinks fit make an interim award. This allows the arbitrator to deal initially with some issues without having to deal with others. This may be really important if there is a preliminary issue involved which could determine the outcome of the whole dispute without the need to decide upon the other issues.

Unless the arbitration agreement provides otherwise there is no set format for making awards but (unless they are interim) they should deal with all the issues in dispute with finality and in order to be easily enforced they should be in writing , signed by the arbitrator and dated. There is only final award and when published the arbitrator is functus officio. If an issue of law arises on which the arbitrator needs the opinion of the High Court the arbitrator may give his award in the form of a special case. In such circumstances the arbitrator will issue 2 or more alternative awards to cover the possible decisions which the High Court may give. An award will not be enforceable unless it contains a clear and unambiguous adjudication on all the issues in dispute referred to the arbitrator. It is not necessary that the arbitrator deal with each and every issue separately it merely requires that no issue is left outstanding. Time of award S23 of the 1954 Act provides tht the arbitrators award can be made at any time subject to other sections in the act and the agreement of the parties to arbitration There is a power to extend any limit on time ( under s23) by order of court or by agreement in writing of the parties. S24 though provides that an arbitrator must use reasonable despatch S36 where the court remits an arbitrators award to the arbitrator for reconsideration the arbitrator is obliged to repair the award within 3 months after the date of remission unless he is otherwise ordered by the court and in any event the parties can still extend the time limits under s23(2). Formal requirements for an arbitrators award 1 Writing No requirement that the arbitrators award be in writing. The law of evidence supports the idea of having a document to produce into evidence. Writing is advisable but the legislation (national and international) does not require it. (See s8 1980 Act). 2 Reasons Reasons are not required and could in fact be dangerous leading to a the award being challenged for error on the face of the record. Arbitrators are discouraged from giving reasons unless specifically required to do so by the parties. If the parties specifically request reasons it is misconduct not to give them. The court can require reasons and can set aside or remit an award on the basis of breach of agreed procedure. If the parties by agreement request reasons the arbitrator has to decide the detail to give and whether to put the reasons in the award document or not. If detailed analysis of questions of fact ok but if detailed analysis of questions of law then the arbitrator is leaving himself open to Judicial Review. In David Manning v John R Shackleton and Cork County Council [1994] 1 ILRM 346 the applicant issued Judicial Review proceedings in the High Court seeking reasons for the arbitrators award. The High Court and Supreme Court

refused the relief sought. The latter stating that the requirement that justice must be seen to be done does not require that an arbitrators award should incorporate anything in the nature of a reasoned judgment. In the Montan case - the following formulation was held to separate the reasons from the award so that should reasons be wrong the award was safe from challenge on the basis of error on the face of the record These reasons do not form part of my award and may not be used in any court proceedings without my permission. Where an arbitrator departs from the normal rule in respect of costs ( ie that they follow the event) the arbitrator is required to give reasons for the departure. The award can be set aside for failure to give said reasons re costs. In Voglaar & another v Callaghan t/a Callaghan Building Contractors (No 1) [1996] 2 ILRM Barron j said that a statement before directions are given on behalf of the arbitrator that it is not his practice to give a reasoned award seems to be inappropriate. He further stated that the plaintiffs having had the opportunity to ask the arbitrator to state his award in the form of a case stated for th opinion of the High Court or alternatively to give reasons for what he has done, it is not open to them now to complain that this was not done. It must therefore be only in rare circumstances where justice can obviously be seen not to have been done that the courts should entertain applications to set aside such awards or remit them to the arbitrator for further consideration. Such steps on the part of the court should only be taken where there is some form of misconduct either by the arbitrator or in the course of the proceedings in some way. Recitals These usually begin with the word whereas they explain the circumstances leading up to the award. Per the case of Thomas Ironworks v R the recitals do not form part of the operative part of the award and thus any defect in the recitals does not invalidate the award. In the Grangeford Structures case the recitals detail the circumstances giving rise to the arbitrator proceedings ex parte thereby putting on the others the onus of disputing the events. Very good idea to put things in recitals when involved in contentious decisions re procedure so all is clear should there be a challenge later. Baker v Hunter states that recitals are not necessary and can be omitted altogether. The authorities are old and one wonders could circumstances referenced in recitals ever be seen to point to reasons for the award. Date good idea as interst payable from date of award This is not required but is advisable as S34 of the 1954 Act provides that interest can be awarded on the Arbitrators award from the date of the award at the same rate as a judgment debt ie 8 % pa approx. The court can award that interest at the enforcement stage. Signatures not required Where there is greater than one arbitrator the arbitrators must sign the award at the same place and at the same time otherwise it may appear that it is not a joint conclusion.

In Eads v William Cranforth LJ stated that when a matter is referred to 2 persons to decide in writing it must be done at the same place and contemporaneously otherwise how would we know whether one person was not induced to change his mind. In Bank Mellat it was held that signatures are not really required and an award will not be invalid by mere reason of absence of signatures. Name and identify parties Ensure the parties are correctly named. In the case of SG Embericos the agent of one of the parties was ordered to make good the default of his principal. Held no court would enforce that award at least summarily. (there are 2 methods of enforcement summarily and action for breach of contract). Publication There are no formalities for publication of the award (ie giving it to the parties) save what the parties have required by agreement between themselves. Aritrators have a lien over the award until they have received their fee. The successful party can pay the arbitrator and look to the unsuccessful party for indemnity. Stamp Duty If you have a document which falls within on e of the categories of the Schedule to the Stamp Act 1891 as amended and if you fail to stamp it then under s14 of that act the document may not be used in evidence except in criminal proceedings and is not available for any purpose what so ever. The Finance Act 1910 requires that even where no duty is payable if your document falls within the categories you must stamp it with a 2particulars deliverd stamp. The 1891 Act mentioned arbitrators awards but this is no longer the case and thus they do not require stamping. The 1891 Act requires documents/deeds regarding land to be stamped, thus if an arbitration award deals with land or an interst in land it may require stamping.

Substantive Requirements 1 Cogent and complete An arbitrators award ought to be addressed in adjudicatory terms I award and direct, I award that, I require that. The award should deal with all the issues. If required to decide 5 things then he should award and direct 5 things. Thus there is a link between cogency and completeness. In Grangeford Structures it stated in the award This is in final satisfaction of all claims made by each of the parties in the reference strong presumption where that formulation is used that the award is complete and may not be set aside if some claims not mentioned. 2 Certain If the award is uncertain it is invalid. Kingston v Layden -The dispute required that the arbitrator inspect a neighbouring mine. The owners of the coal mine claimed the neighbouring mine for trespass. The arbitrator said the plaintiff suffered damages 32,432 by reason of trespass and then ordered that the defendant suffered damages of 3,753 by reason of trespass.

3,745 of defendants damages had occurred greater than 6 years before the action (so statute of limitations had run out) The arbitrator simply said this is a matter for the court to pronounce upon. Therefore without court pronouncement it was uncertain who got what. Supreme Court held- this purported award is not valid it is uncertain as it does not achieve anything not clear as to what the he was awarding at the end of the day. Final The award must be complete and leave nothing further to be done S27 of the 1954 Act states that unless the contrary is expressed in the arbitration agreement the arbitration agreement is deemed to contain a provision that the award is final and binding on the parties and the persons claiming under them respectively. The effect is that the award is the fulfilment of the contractual obligation. Enforceable This is the aim of all the previous requirements. The arbitrators position where an award isnt enforceable is that he has been in breach of his contract with the parties and may be required to re-consider the issue or to produce a new award. There are 2 ways an award can be enforced 1 By taking an action of the award eg for breach of contract 2 By summary enforcement s41 of the 1954 Act E second entitles you to have the award enforced in the same way as a High Court Judgment. There are situations where the award is not summarily enforceable. To what extent has the arbitrator breached his requirement to present an enforceable award when he resents an award that isnt summarily enforceable? In relation to enforcement even if the award isnt enforceable it has nevertheless been decided that any issues of fact determined by the arbitration generate an issue estoppel as against both parties and that estoel is binding. That estoppel can be recognised by a future arbitrator or a court because having chosen an arbitrator to decide that issue you are bound by his decision.

Reliefs In terms of the final award there are important reliefs that the arbitrator can award (a) A Monetary sum (damages) this is the most common form of relief. S34 of the 1954 Act provides that the award carries interest at the rate of a judgment debt (b) 8% from the time the award is given unless the award states otherwise (c) .Declaration the award may declare what the arties rights are eg s declaration that one party shall indemnify the other for expenditure to be incurred u to a specified sum. (d) Equitable relief s26 of the 1954 Act empowers arbitrators in the absence of

(e)

any contrary provision in the agreement to direct specific performance of contracts other than those relating to land or an interest on land. (Unlike a court order which has immediate effect, an application must be made under s41 of the 1954 Act to make the award effective). Also any injunction awarded will not have effect until enforced under s41. Injunctions are usually used to give immediate relief but that cant happen with one ordered by an arbitrator as the award must be enforced first so perhaps not very practical. Interest This is the most complicated power that the arbitration has or may have in relation to the award. Look at interest from a number of tacks -Between date of default and award -Between date of award and present -Interest that arises solely because of the agreement eg interest under a loan agreement.( Post award interest is dealt with under s34 of 1954 Act it provides that the award carries interest at the judgment rate from the date of the award unless the award states otherwise. Horan v Quilter 1/3/2004 SCT Whether interest on the sum of 30,331.65 (being the amount of the plaintiffs Bill of Costs submitted on foot of paragraph 5 of the Arbitrators award) should run from the date of that award, the 26th November, 1996 or from the date of the High Court judgment enforcing the award, the 2nd July, 2001 Held that s.34 of the Arbitration Act, 1954 extends to costs as well as to any other sum ordered to be paid in an arbitration award. Thus interest on the sum ordered to be paid runs from the date of the Arbitrators final award, rather than from the date of the High Court order.

S17.The Arbitration Act, 1954 , is hereby amended by substituting the following for section 34 "Interest on awards 34.(1) The parties to an arbitration agreement may agree on the powers of the arbitrator or umpire as regards the award of interest (2) Unless otherwise agreed by the parties, the arbitrator or umpire may award simple or compound interest from the dates, at the rates and with the rests that he or she considers meet the justice of the case (a) on all or part of any amount awarded by the arbitrator or umpire, in respect of any period up to the date of the award (a) on all or part of any amount claimed in the arbitration and outstanding at the commencement of the arbitration but paid before the award was made, in respect of any period up to the date of payment. (3) Unless otherwise agreed by the parties, the arbitrator or umpire may award simple or compound interest from the date of the award (or any later date) until payment, at the rates and with the rests that he or she considers meet the justice

of the case, on the outstanding amount of any award (including an award of interest under subsection (2) and an award of costs). (4) References in this section to an amount awarded by an arbitrator or umpire include an amount payable in consequence of a declaratory award by the arbitrator or umpire (5) This section shall not apply to an arbitration commenced before the day on which the Arbitration (International Commercial) Act, 1998 , comes into operation unless (a) the arbitration is concluded after that day, and (b) the parties agree that this section shall apply (6) This section shall apply to an arbitration commenced on or after the day on which the Arbitration (International Commercial) Act, 1998 comes into operation (a) under an arbitration agreement entered into on or after that day, or (b) if the parties so agree, under an arbitration agreement entered into before that day. S10 of the Arbitration (International Commercial) Act, 1998 .(1) The parties to an arbitration agreement may agree on the arbitral tribunal's powers regarding the award of interest (2) Unless otherwise agreed by the parties, the arbitral tribunal may award simple or compound interest from the dates, at the rates and with the rests that it considers meet the justice of the case (b) on all or part of any amount awarded by the arbitral tribunal, in respect of any period up to the date of the award (c) on all or part of any amount claimed in the arbitration and outstanding at the commencement of the arbitration but paid before the award was made, in respect of any period up to the date of payment. (3) Unless otherwise agreed by the parties, the arbitral tribunal may award simple or compound interest from the date of the award (or any later date) until payment, at the rates and with the rests that it considers meet the justice of the case, on the outstanding amount of any award (including any award of interest under subsection (2) and any award of costs). (4) References in this section to an amount awarded by the arbitral tribunal include an amount payable in consequence of a declaratory award by the arbitral tribunal. (5) This section shall not affect any other power of the arbitral tribunal to award interest

There are 2 approaches to pre-award interest and depend on the nature of the interest being awarded. Hadley v Baxendale Two pronged rule from the law of contract concerning the award of damages. Where there is breach of contract the damages one can be awarded are

Damages that arise naturally, ie in the usual course of things 2 Damages for such damage as both parties ought to have had in their contemplation at the time they entered the agreement. (Predictable loss/Special damage) Important as if interest is the kind of damages that arises under one of these two headings then the arbitrator is awarding damages for interest is doing no more than awarding damages for breach of contract according to the law of contract. Provided of course that the interest is arising out of a contract case. Contract case Hadley v Baxendale Tort Case no such rule re consequential loss. Might fit under rules of remoteness of damage. If the award of interest doesnt fall under these two headings does an arbitrator have inherent power to award pre-award interest? No problem if he has express power under the agreement but does he have inherent power? McStay V Assicurazioni Gnerali Spa [1991] ILRM 237 The Supreme Court declined to decide whether arbitrators generally can award interest for the period prior to the award. It was held that since one of the issues submitted to the arbitrator for determination was whether he had jurisdiction to award interest for the period prior to the award the arbitrators decision on the matter was final and could not be upset by the court save where the issue was in a case stated to the court or there was an error of law on the face of the record or misconduct. ( In the case the arbitrator held he did not have authority to award pre-award interest). OFlaherty J said (obiter) that at common law the arbitrator has no inherent power to award interest and statute gave no such power either therefore no inherent power to award pre-award interest. In the UK the legislature specificially inserted s statutory power (in 1982) in s19(a) of the Arbitration Act 1950 that unless there is a contrary intention in the arbitration agreement every arbitration is deemed to include a provisions that the arbitrator may award simple interest on pre-award sums paid or pre-award causes of action. Australia also has a similar approach. Wadsworth v Lydall 1981 1 AER 401 Interest was recovered there as it wa consequential loss as successful claimant had to borrow money and pay interest on it due to wrongful refusal of other party to pay before the award. S17 of the 1998 Act amends s34 by substituting a new S34 and gives the arbitrator power to award interest at whatever rate he feels meets the justice of the case on all or part of any amount awarded by him both up to the date of the award and from the date of the award to the date of actual payment. Where parties agree on the power of the arbitrator re interest. Unless agreement arbitrator may award simple or compound interest from the dates and at the rates

and rests he considers meets the justice of the case. It can be simple or compound interest from date of award or later Section 17 applies to arbitration agreements entered into after the day on which the 1998 Act came into operation (20 May 1998) unless the parties to the arbitration agree otherwise.

(f)

Costs The arbitrator is required to deal with costs if he fails to do so then his award is incomplete Re Beaker, Smullan, Barry (1921) Under s31 of the 1954 Act If the arbitrator does not deal with the liability for costs in his award any party to the reference may within 14 days of the publication of the award or such extended time as the High Court may allow apply to the arbitrator for an order directing by whom and to whom those costs shall be paid. In that event the arbitrator shall after hearing any party who wishes to be heard amend his award by adding such directions as he may think proper in relation to the payment of costs. There are 2 kinds of costs in an arbitration 1 Costs of the award ie the arbitrators remuneration and expenses (each party is liable to ay these 2 Costs of the reference- (ie expenses incurred by each party in preparing and presenting their case, lawyers fees, witness expenses etc) Occasionally the arbitration agreement will state how the costs are to be paid but s.30 of the 1954 Act declares void any stipulation that the parties are to bear their own costs regardless of the outcome of the arbitration. (This though does not apply to an ad hoc reference to arbitration where the dispute has already arisen before it is agreed to arbitrate) Sections 29-34 of the 1954 Act makes certain provisions with regard to costs which the parties can supplant by agreement.

Arbitrators discretion The arbitrator generally decides which party pays the costs and the proportion to be paid. Unless the parties agreed otherwise s29(1) of the 1954 gives the arbitrator a discretion over who shall bear the costs of the award and of the reference and in the manner in which those costs or any part of them shall be paid. This discretion has to be exercised judicially. In the Everglades Maritime Case [1993] QB 780- the courts explained where parties opt for arbitration in England that includes the traditional English approach to costs 1 The award of costs is in the discretion of arbitrators as it is of judges 2 In neither case is the discretion absolute or unfettered but should be exercised judicially in accordance with settled principles. 3 The dominant principle is that costs should follow the event ie the winner recovers his taxed or agreed costs from the looser.

4 5

It is necessary to consider the outcome of the proceedings to decide which costs should follow The court will take account of payment into court in exercising its discretion on costs. (If plaintiff does not recover more than was paid in then he covers the defendants cost from date of payment) (A sealed offer is the arbitral equivalent of making a payment into court.)

Not following the event There are certain circumstances that justify not following that rule but the fact that the claimant did not recover all he sought would not generally be enough. If a party has conducted himself in an unreasonable manner, unnecessarily prolonged the hearing or increased the other sides costs he faces a costs penalty eventhough he won. Sealed Offers There is no equivalent in arbitration to the lodgment system which exists in litigation. Offer which are made by one party to the other prior to the arbitration hearing are usually stated to be made on a without prejudice basis save as to costs (i.e. the party making the offer wishes the arbitrator to take account of it in any award he is making on costs only) and the arbitrator is given a sealed envelope which he only opens after having reached a decision on the merits of the case ie the substantive issue. Where the sum offered exceeds the amount the arbitrator awarded then the costs will be given in favour of the offeror from the time the offer was made. A sealed offer which is marked without prejudice save as to costs is known as a caulderband letter/offer. When such an offer is made the practice is to make an interim award on the merits, give the parties time to agree on the costs, if they dont the arbitrator decides and takes the caulderbank letter/offer into account. Offer including Interest Settlement offers may state a particular sum plus interest. In the Transmountana Amadera Case [1978] 2 AER 870 the court set out how the interest element should be dealt with when calculating costs. The arbitrator knows what the claimant would have received if he accepted the offer (which didnt include interest). The arbitrator knows what in fact he awarded both principal and interest In order to compare like with like the arbitrator must recalculate the interest element as if the award had been made on the same date as the offer. Alternatively interest for the period between the offer and the award must notionally be added to the amount of the sealed offer. Subject to the above the question of whether the offer exceeded the award is easily answered. Offer including costs Exceptionally an offer to settle may include and offer to pay all or parts of the other sides costs. In the Everglades Case the issue was whether the tribunal in calculating whether the

offer exceeded the award should take account of the costs part of the offer in the same way as interest is considered. It was held that cost elements should be disregarded in making the calculation as it would complicate matter too much and anyway costs are not part of the claim but are merely ancillary to it. Quantum disputes If the dispute is purely re quantum how much rent to be paid or what value to place on shares we are not talking about a contractual or tortuous dispute. We have a different kind of dispute with a different kind of event here there is no clear winner or loser. What happens here tends to be that where an offer is close to the sum awarded a fractional award of costs will be made to that party otherwise no order for costs will be made save where the amount offered and the sum awarded are identical which would be very rare. Judicial review on award of costs Often the scope is limited to where no reasons are given in the award. Where the award is given in the form of a case stated and the arbitrators in awarding costs doesnt follow the event he is exhorted to state the reason why, if no reasons are given the award will be remitted to the arbitrator so he can give them. The scope for judicial review of a final award on the bases of misconduct is as per Diplock LJ in Heaven & Hesterton Ltd v Sven Wiaeus A/B [1958] 1WLR 1235 two things are clearFirst, that the court has jurisdiction where it appears on the material before it that an arbitrator has exercised his discretion in a non-judicial manner as to costs, to set aside his award so far as it relates to costs. The second is that it matters not whether the material upon which the court comes to the conclusion that there has been a non-judicial exercise of discretion appears on the face of the award or appears by affidavit evidence which comes before the court. If on the evidence before the court the arbitrator acted in a non-judicial manner it is technical misconduct and the award will be remitted to be amended in light of the findings of the court. The mere fact though that the court would have reached a different decision to the arbitrator is not enough for it to be set aside it would need to be a decision that the court would not reach. Rebuttable presumption arbitrator has erred in law or acted in an unjudicial manner where he departs from the follow the event rule with respect to costs and gives no sufficient reason. Arbitrator not required to give reasons in award can given them on affidavit or the reasons can be clear without being stated claim was for an excessive sum. Remit The court can exercise its jurisdiction to remit under s36 1954 Act where there has been some procedural mishap regarding costs. King v Thomas McKenna Ltd [1991] 2 QB 480 Selaed offer made but counsel neglected to tell arbitrator or other side she needed issue of liability and quantum resolved prior to any consideration of costs. A final award was made against the offeror including costs. The court remitted the matter back to the arbitrator so he could deal with the question of costs in light of the offer.

Taxing costs Cost of the reference can be taxed in the same manner as court costs. With the consent of the parties s29 of the 1954 Act empowers the arbitrator to tax or settle the amount of costs to be paid. Generally costs are measured on a party- party basis ie only expenses necessarily and properly incurred to advance the case are allowed Solicitor client costs means the actual costs incurred. No Costs mentioned Where award contains no order directing the payment of the costs of the reference either party may apply to the arbitrator to deal with the matter under S31 1954 Act. They must apply within 14 days of the award otherwise they need to go to court and get an extension of time. The arbitrator may then hear any party who wishes to make submissions on costs and then amend his award by adding directions as to costs. Practice As a matter of practice an arbitrator wont issue his award until he has been paid his fees and expenses in full Publication of Award Where an arbitrator has made his award it is generally said to be published. However the time limits for challenging the award are usually determined by reference to the date when there was publication or delivery of the award to the parties. Amendment of award S28 of the 1954 Act provides that unless the arbitration agreement provides otherwise an arbitrator can amend his award in order to correct any clerical mistake or error arising from any accidental slip or omission on application to him by one of the parties on adequate notice to the other party. Thus a party must apply to the arbitrator to correct the error he cant do it off his own bat. Mutual Shipping Corp v Bayshore Shipping Co [1985] 1 WLR 625 the arbitrator (in his notes) wrongly attributed the evidence of one partys witness to the other side and thus awarded in favour of the wrong side. Even this was llowed to be corrected under the slip rule. Effects of the Award Once the award is made the arbitrator is functus officio and the award is final and binding save 1 re an application under the slip rule s28 or 2 re an aplication under s31 where he didnt deal with costs or 3 re S36 where the court remits the award back to the arbitrator

Thus the priciple of res judiciata applies to all maters decided by the award or necessarily involved in the decision. The courts can prevent litigation or arbitration of an issue raised in the arbitration or even one that should have been raised in the agreement this is to prevent abuse of process of the court and re-litigating the same matters. Third parties are not affected by an award unless they have agreed to be. _______________________________________ Enforcement of the award Arbitration awards unlike court orders are not directly enforceable ie you cant register it as a judgment mortgage or send in the sheriff to seize goods on foot of it, application has to be made to the High Court for the enforcement of an arbitration award. An arbitration award is enforced by 1 either party taking an action on the award (ie proceedings for breach of contract) (There the plaintiff pleads and proves: -the arbitration agreement, -the award, -that the dispute was within the terms of the agreement and the arbitrator was duly appointed. It is a good defence if -the arbitrators power was revoked , or -award was void (voidable is no good as it can be remitted to the arbitrator to cure the defect) Parslow v Bailey (1704) recognised that parties to n arbitration impliedly promsie to be bound by the award. 2 by either party seeking summary enforcement of the award as if it were a judgment under s41 Under S41 of the 1954 Act an arbitration award may by leave of the High Court be enforced in the same manner as a judgment or order to the same effect. This is done by way of Special Summons pursuant to Rule 4 of Order 56 of the Rules of the Superior Courts SI 15/1986) The latter is a speedy way of enforcing the award but the award must be one capable of being enforced as a judgment It is not a defence to show error on face of the award or misconduct, as in such case the award at most is voidable but remains enforceable. It would be a defence to show that the award was void eg arbitrator had no authority to make the award eg arbitrator not properly appointed or had his power revoked. Grange Developments Ltd v Dublin CC 14/3/89 Murphy J said once an award has been made- - - and not challenged in the court - - it should be

entered as a judgment and given effect accordingly. It should not be held up because the loosing party says he wants to argue some point or other or says he wants to set up a counterclaim Thus leave should be given for summary enforcement unless there is a real reason for doubting the validity of the award. If you want to raise a judicial review point then seek to have the summary enforcement proceedings adjourned pending the JR. _______________________________________________________________ Challenges to award Passive Challenges (defences to enforcement) 1 Lack of substantial requirements - CCCFE 2 Award outside scope of submission (ie outside jurisdiction) Cant in defence claim procedural wrong.

Proofs for enforcement In the Christopher Brown Case it was stated that the following were required to be proven in order to enforce an arbitrators award, therefore in a passive defence youd seek to show the following 1 Arbitration agreement never came into existence or was unenforceable 2 The dispute was outside the scope of the agreement ie it referred to disputes under contract and the dispute was re tort. 3 The Arbitrator was not validly appointed 4 No award was made 5 There has been no default in honouring the award.

Scrimaglio and Termarea cases state that you cannot defend an action to enforce the award on the mere basis of misconduct (Scrimaglio) or on the basis of error of law (Termarea) therefore if you have a complaint re these you must take an active challenge.

Active Challenges to an award Take an action to 1 Set aside (Sec 38) of the 1954 Act gives the High Court power to set aside the award where:(i) The arbitrator has been guilty of misconduct or (ii) the award has been improperly procured a. Breach of agreed procedures

b. Breach of fair procedures c. Misconduct d. Excess of jurisdiction error of law on face of record. Where there is error of law on the face of the record the High Court at common law can set the award aside or pursuant to statute remit it. (Note an application for set aside or remittal must be made to the High Court within 6 weeks of the award being made and published to the parties or such further time as the High Court may allow). 2 Per S39 the High Court has a general power to give relief where the arbitrator is not impartial or the dispute referred to arbitration involves a question of fraud 3 The High Court has a power to remit (ie refer back to arbitrator for reconsideration). S36 of the 1954 Act gives the High Court power to refer to an arbitrator for reconsideration any issues on which he has made an award, and provides that unless the court order directs otherwise the arbitrator shall make his further award within 3 months after the date of the order 4 Declaration of Invalidity This is an alternative means of challenge commonly used where it is claimed that the arbitrator lacks jurisdiction and the award therefore lacks jurisdiction. A declaration is only available in respect of jurisdiction wrongs and is not appropriate for misconduct or error on the face of the record 5 Injunction This comes into its own where enforcement of an award is sough in another jurisdiction. You can get an injunction from the Irish Courts preventing enforcement in another country if person trying to enforce is in Ireland. Also useful where non-legal enforcement is being effected eg blacklisting, rescission of contract. The authority for granting an injunction is Birkett & Sharp & Co v Eastcheap Dried Fruit _______________________________________

Judicial control of arbitration

Bremer Vulkan [1982] AC 909 In relation to private arbitrations the jurisdiction of the High Court to supervise the conduct of the arbitration is confined to exercising the powers conferred upon it by the Arbitration Acts.

There are some limited circumstance though where the courts will intervene by way of injunction to protect a legal or equitable right eg the reference may be stopped where the agreement is void or the arbitrator has no jurisdiction over the dispute. Whilst in essence arbitration is a private process the courts do intervene to support and supervise the arbitration process and enforce the award. (1)The Court can aid in the constitution of the Arbitral tribunal There are 5 circumstances where the arbitrator can be nominated by the court under s18 of the 1954 1 where the parties cannot agree on a sole arbitrator 2 3 4 5 where the arbitrator refuses to act, is incapable of acting or dies (save where the terms of the agreement provide for the filling of such a vacancy) the parties or the arbitrators refuse to appoint a third arbitrator or umpire the umpire or third arbitrator refuses to act or is incapable of acting or dies. where all the arbitrators are removed by the Court S40(2)(i) of the 1954 Act gives the court a discretion to appoint a sole arbitrator.

(2)Replacement of Arbitrator S40 a party can apply to court to appointment an arbitrator in place of a previous one (3)The Court can give effect to the arbitration agreement by staying litigation Under S5 of the 1980 Act where a dispute between parties is the subject matter of an arbitration agreement then the court will accede to an application to stay any litigation and thus requiring the parties to litigate there differences. (See pages 8-11 supra) A stay will only be granted where the dispute is covered by the terms of the arbitration and said agreement is not null and void. The application is to be made after an appearance is entered but before any steps have been taken in the proceedings. If the application is made prematurely it will be refused. If steps have been taken in the litigation process (ie something involving court costs) then the party will be seen as having consented to litigation.

(4)Assisting an arbitrator S20 and 21 subpoena witnesses and compel attendance of prisoner The court on application to it can direct that the arbitrator has the following powers and

how they should be used S22(1) (a) security for costs S22(1) (b) discovery and inspection of documents (c) giving evidence by affidavit (d) examination on oath of any witness before an officer of the court or any other person, and the issue of a commission or request of the examination of a witness outside the jurisdiction (e) the preservation, interim custody or sale of any goods which are the subject matter of the reference (f) securing the amount in dispute in the reference (g) the detention, preservation or inspection of any property or thing which is the subject of the reference or as to which any question may arise therein and authorising for any of the purposes aforesaid any person to enter upon or in any land or building in the possession of any party to the reference or authorising any samples to be taken or any observations to be made or experiment to be tried which may be necessary or expedient for the purpose of obtaining full information or evidence and (h) interim injunctions or appointment of a receiver (5)Case Stated An arbitrator may state a case for the opinion of the High Court but if arbitrator doesnt want to state a case a party can apply to the High Court to compel him to do so. S35 of the 1954 Act. It is too late to seek a case stated once the award has been published. If a party requests a case stated and the arbitrator refuses and goes ahead and makes an award without allowing sufficient time for the party to go to court to seek directions then the arbitrator may have misconducted the proceedings and the award can be set aside. The function of the case stated system is to provide a structure for arbitration but also to ensure adherence with the law of the land. there will be no alsatia in England where the Kings writ does not run Idea that the procedural law is the law of the place of arbitration. In the Lysland Case [1973] 1 QB 843 Denning LJ laid down the circumstances in which an arbitrator should state a case 1 There should be a real and substantial point of law which is open to serious argument and which is appropriate for a decision of a court of law 2 The point of law should be clear cut and should be capable of being accurately stated as a point of law. 3 The point of law should be of such importance that its resolution is necessary for the proper determination of the case. After this case arbitrators granted applications for case stated more easily as fear failure to do so would lead to a charge of misconduct.

Hogan v St. Kevins Company [1986] IR 80 This was in connection with a commercial where the amount of the service charge was to be determined by the landlords auditors who was issue a cert specifying the amount payable. The lease provided that said certificate would be final and binding. The lease provided that any disputes between the parties would be dealt with by arbitration. In 1982 a dispute arose re the amount of service charge payable under the certificates and an accountant was appointed as arbitrator. The issue was what was the significance of the agreement in respect of certification of the service charges. The parties appointed a legal adviser to assist the arbitrator. The arbitrator decided that the cert could be impugned to a limited extent and the disgruntled party sought a case stated. The High Court held the parties had initially sought to have a matter of law resolved by arbitration and notwithstanding the arbitrator had no legal qualifications it would be unfair and unjust for the unsuccessful party to now try and substitute the decision of the High Court on the matter. Murphy J pointed to the fact that they had chosen a legal adviser to assist the arbitrator and said that indicated they were not going to court afterwards and thus were estopped from seeking a case stated. The case of Stillorgan Orchard Hamilton P stated that the Court will state a case if the applicant has in the first instance requested the arbitrator to state a case and he has refused. The application to the arbitrator to have a case stated must have been clear unambiguous and not vague. In the case the court refused to direct a case be stated as counsels submission to the arbitrator amounted to no more than vague murmurings that maybe a case should be stated. It is not misconduct for an arbitrator merely to refuse to state a case, where the misconduct may arise is where an arbitrator having refused to state a case refuses an adjournment to allow and opportunity for a party to apply to court. (6) Removal of Arbitrator An arbitrator may be removed by the court for failure to use reasonable despatch S24 and misconduct s37 S24 the high court can remove an arbitrator or umpire and he shall not be entitled to remuneration if he has failed to use all reasonable despatch. Louis Emmanuel v Sammut Dealy of 4 months in production of award after conclusion of a short hearing arbitrator gotten rid of. The law has established that failure to use reasonable despatch must be the only cause of the delay, if something else is the cause eg misconduct then the appropriate application is under s37 Pratt v Swanmore The arbitrator failed to get the arbitration in motion within a reasonable time as he failed to show the competence one would expect of someone in his shoes. One party sought his removal on 2 grounds failure to show reasonable despatch and misconduct. Held failure of competence s37 therefore he gets his remuneration.

S37 the High Court can remove an arbitrator for misconduct (In such circumstances the award can be set aside if improperly procured s38 and thus the whole arbitration is rendered null and void) Pratt v Swanmore deals with what is misconduct Pain J Having regard to an arbitrators conduct it would be unfair to leave the arbitration in that arbitrators hands. The idea being that there is no reasonably prospect of justice being done if the arbitration is let continue. Misconduct does not require moral turpitude. No degree of intention is necessary. It is purely procedural. Modern Engineering case Issue related to an architects cert ie he certifies that the costs put in by the contractor are reasonable in relation to the work done -. Normally an architects cert is deemed final re costs. Claimant made an opening submission and the arbitrator on foot of this made an interim award before the defence had made a submission. This was a reach of natural justice audi alteram partem. 2 sets of relief sought - removal of the arbitrator and setting aside of the award. Goff J set aside the award but refused to remove the arbitrator stating that there were varying degrees of misconduct and the misconduct which resulted in the setting aside of an award was less serious than that needed to remove the arbitrator The Court of Appeal overturned the decision not to remove the arbitrator but did not devalue the proposition that there are varying degrees of misconduct and the most serious being required for the removal of an arbitrator. Dunne and Denning LJJs focused on the confidence of the parties. Irish cases there is a focus on the possibility of justice not being done. Examples of misconduct 1 Visiting the property the subject matter of the dispute accompanied by the employee of one of the parties (State(Hegarty) v Winters [1956} IR 320 2 Not hearing relevant evidence OSullivan v Joseph Woodward & Co [1987] IR 255 3 Not affording parties the opportunity to make submissions on a relevant point. Geraghty v Rohan Industrial Estates Ltd [1988] IR 419 4 5 Lacking of elementary skill to conduct the arbitration = misconduct (Pratt v Swanmore no breach of the rules of natural justice save that no-one could conceivea justi outcome from the way the arbitrator was conducting the arbitration) Misconduct to enforce an award which deals with an illegal contract David Taylor v Burnett contract re controlled substances held unenforceable on basis it related to an illegal contract.

Please note that error of law or fact on the face of the record is not misconduct, neither is refusing to state a case to the High Court (Stillorgan Orchard v McLoughlin & Harvey

[1978] ILRM 128) S15(2) B the court is given the power to setting aside any appointment in S15(2) A (S15(2) A is not very commonly relied upon.

(7) Revocation of the Arbitrators authority s39 and s9 S39 provides for the revocation of the arbitrators authority by the high court :where the arbitrator is not/may not be impartial or there are allegations of fraud. S39(2) applies only to agreements to arbitrate future disputes, ad hoc submissions of an existing dispute involving accusations of fraud are not affected by the section. The ordinary rule of estoppel does not apply to s39 thus where a party seeking relief under s39 knew or ought to known the arbitrators relationship with the other party or connection to the subject matter of the dispute it will not be a ground for refusing the application. (though estoppel will operate in other case of removal just not per s39) Bias The general principle nemo iudex in causa sua applies to arbitrators principle against bias justice must not merely be done but must be seen to be done. Thus the arbitrator cannot be bribed or even place himself in a situation where it appears he is biased (apparent bias). The test per Blayney J in Bord na Mona v Sisk Unrep HCT May 31, 1990 Is whether a right minded person with full knowledge of the facts would have been led to conclude there was a real likelihood of bias In that case the arbitrator had provided professional services to the respondents (a property developer) associate building company. It was held there was no real likelihood of bias. If the arbitrator has a shareholding in one of the parties he should disclose that even where such a shareholding is unlikely to affect his decision. The arbitrator should not be connected to the subject matter of the reference as this too against his impartiality. Bias in conduct of the reference The arbitrator must not have undue contact with one of the parties. Re Briens Arbitration [1910] 2 IR 84 -arbitrators were appointed to value the land, which the parties had worked in partnership, and to determine which of them should have first offer to purchase the land. Under the procedure agreed by the parties each arbitrator was to make a separate valuation of the farm on behalf of the party whom he represented. One of the arbitrators viewed the farm accompanied by the party who had appointed him but was not accompanied by the other party. Said action was held to be contrary to all principles of justice and fair play and amounted to misconduct. Boyd J stated that arbitrators must not be guilty of any act which can possibly be construed as indicative of partiality or unfairness. It is not a question of the effect which misconduct on their part had in fact upon the result of the proceedings, but of what effect it might possibly have produced. what we are talking about is the appearance of bias. State(Hegarty) v Winters [1956] IR 320

There the arbitrator visited the property that was the subject of the reference accompanied by an employee of one of the parties. That was held to reasonably give rise in the mind of an unprejudiced onlooker to the suspicion that justice was not being done. The award was set aside on the grounds of the arbitrators misconduct. In Childers Heights Housing Ltd v Molderings [1987] ILRM 47 The arbitrator expressed a wish to view the site on her own and neither party raised any objection . It was held her going to view the site on her own was not misconduct. Tobin and Twomey Services Ltd v Kerry Foods Ltd [1999] 3 IR 483 The High Court confirmed that the courts discretion to remove an arbitrator is likely to be confined to cases where the arbitration cannot continue with the particular arbitrator in office either because he had shown actual or potential bias, or his conduct had given serious grounds for destroying the confidence of one or both of the parties in his ability to conduct the dispute judicially or competently. Redress for bias The 1954 Act provides for the sanctioning of bias or breach of the nemo iudex principle. Actual bias can justify the court setting aside the award or revoking the authority of the arbitrator as well as the arbitrator being denied his fee and possibly his out of pocket expenses. If the arbitrator has been found to be in collusion with a party or otherwise corrupt the court can make him liable for the costs fo the arbitration. Where a party is aggrieved because of bias then must generally make their objections known at the earliest possible opportunity or they may be regarded as having waived that objection. S39 provides an exception to that principle where the objection is that the arbitrator has a relationship with a party or with the subject of the reference and the objecting party was aware or should have been aware of that relationship at the time he entered into the arbitration agreement and the arbitration was named or designated in that agreement. What do we mean by fraud it usually involves deceit, making a false statement. The courts power in circumstances where fraud is alleged is discretionary. Generally per Forde where the party accused of fraud wants the matter litigated it will be but if he is happy to have the matter dealt with by arbitration the courts will be inclined to let that happen, but it all depends on the circumstances of the case and the nature of the fraud. There is a public interest in an open trial for certain allegations of fraud. Administratia Asigurarilor de Stat v Insurance Corp of Ireland [1990] ILRM 159 This concerned a dispute between an insurance company and a re-insurance company concerning a large amount of money. The plaintiffs sought to repudiate their contracts and claimed that the defendants insurance arrangements had been of a fraudulent nature . The plaintiffs alleged fraud abd sought to have the arbitration agreement set aside and issueda summons and draft statement of claim. The defednats sought a stay under s5 1980.

OHanlon J stated that the courts discretion under s39(2) was broad. He rejected the contention that one had to establish a prima facie case of fraud and stated it suffices if the allegations of fraud are made with perfect bona fides ie are not sham or frivolous or put down with the intention of placing an obstacle in the way of arbitration. In that case a prima facie case was made out and the claim was extremely complex and it was felt that a hearing in the High Court with an appeal to the Supreme Court was preferable in dealing with difficult issues of law, __________________________________________________ S9 1954 Act provides that the authority of the Arbitrator/umpire appointed by virtue of an arbitration agreement shall unless there is a contrary intention expressed in the arbitration agreement be irrevocable unless one obtains the leave of the court. One leave is given it may only be exercised against an arbitrator upon whom authority had been conferred by the revoking party (ie you cant get leave to revoke other sides arbitrator revocation can only be made by those who gave the authority in the 1st place.) Where the arbitrator is a sole arbitrator therefore both sides will have conferred authority on him. S9 also applies where a sole arbitrator was appointed by an appointing body. What factors should the court take into account in giving leave ( none are listed in the section) It has been held that the court should exercise the jurisdiction to give leave to revoke the arbitrators authority most sparingly and with caution Den of Airlie SS Co v Mitsui & Co (1912) 106 LT 451 Mustill J in Sucula Ltd called it a power of last resort. (See page 26 of notes above) (8) Setting Aside of the award (Sec 38 of the 1954 Act enables the High to set aside the award where there is misconduct or the award is improperly procured a. Breach of agreed procedures b. Breach of fair procedures (See duties of arb and above re bias and misconduct) c. Misconduct- see above d. Excess of jurisdiction e. Error of law on face of record. see below remission An application to remit or set aside an arbitrators award must be within 6 weeks after the award has been made and published or such further time as the court may allow. What is error on the face of the record? Where there is an error of law on the face of the record the High Court may set the award aside at common law or remit the award under the legislation. Per Keenan v Shield Insurance Company [1988[ IR 89 -The error must be obvious and so

fundamental that the courts cannot stand aside and allow it go unchallenged. Per Church & General v Connolly it must be an error of law on the face of the record ie on the award or a document actually attached thereto.It must be an error of law on which the award is based. In McStay v Assicurzioni Generali Spa [1991] ILRM 237 the Supreme distinguishes between an error on the face of the record where a general issue in dispute is submitted and an issue of law arises as a result and an error on the face of the record where a precise question of law has been submitted. This case involved the latter ie what interest if any was payable. The court because the parties had chosen arbitration to decide the precise question of law the decision of the arbitrator could not be overturned no matter how erroneous. In Vogelaar & Another v Callaghan t/a Callaghan Building Contractors (No 1) [1996] 2 ILRM Barron J held that although the error did not appear expressly on the face of the record, it was nevertheless clear from the affidavit of the Arbitrator and implicit in the award itself that the arbitrator failed to take into account the offer which had been made (in relation to the issue as to costs). It seemed to Barron J that to allow the award to stand in such circumstances would be a severe injustice and he remitted the matter back to the arbitrator to make such an award as he considers proper having regard to the offer. Where there are no reasons given for the award it is difficult to detect an error of law. Per Vogelaar the 6 weeks runs not from the time the parties receive copies of the award or are aware of its contents but from when it is actually made. Barron J extended time in the circumstances as the award was taken up jointly when the 6 weeks had run out (the rule being unknown to both sides) ( thus if the rule were enforced they would have been required to issue proceedings when they didnt know the content of the award. It was also held that the extension of time and length thereof depended on the facts. (9) Remission Rather than set an award aside S36 allows the High Court to remit an award back to the arbitrator to reconsider it. The courts can remit an award on 4 grounds 1 Where there was misconduct by the arbitrator (we looked at what equals misconduct above) 2 Where there is an error of law on the face of the record 3 Where the arbitrator has made a mistake in drawing up the award and wants to have the matter remitted to him or Cusually rectified though under the slip rule s28 1954 Act) 4 Where fresh evidence is discovered which probably would have had a substantial effect on the decision made. King v Thomas McKenna Ltd [1991] 2 QB 480 held that the jurisdiction to remit goes

beyond the above 4 grounds and extends to any case where due to mishap or misunderstanding some aspect fo the dispute which has been the subject of the reference has not been considered and adjudicated upon as fully as or in the manner which the parties were entitled to expect and it would be inequitable to allow any award to take effect without some further consideration by the arbitrator OHanlon J refused to remit a matter back to the arbitrator as it did not come within one of the four grounds, in the case of Portsmouth Arms Hotel V Enniscorthy UDC Unrep HCT Oct 14th, 1994 Yet in McCarrick v The Gaiety (Sligo) Ltd [2001] 2 IR 266 it was held there was a procedural mishap of the type referred to in King and the award was remitted. An application to remit or set aside an arbitrators award must be within 6 weeks after the award has been made and published or such further time as the court may allow. Per Vogelaar the 6 weeks runs not from the time the parties receive copies of the award or are aware of its contents but from when it is actually made. Barron J extended time in the circumstances as the award was taken up jointly when the 6 weeks had run out (the rule being unknown to both sides) ( thus if the rule were enforced they would have been required to issue proceedings when they didnt know the content of the award. It was also held that the extension of time and length thereof depended on the facts. Where the court remits an award then the arbitrator has 3 months from the date of the order to make his award (10) Enforcement of the award An arbitration award is enforced by either party taking an action on the award (ie proceedings for breach of contract) by either party seeking summary enforcement of the award as if it were a judgment under s41 where leave is so given judgment is entered in the terms of the award Thus leave should be given for summary enforcement unless there is a real reason for doubting the validity of the award. (11) S33 where arbitrator withholds award until payment of fee Per S33 1954 Act the court on application may order the award be given and money paid into court (12) Role in International Arbitration A court must stay litigation before it unless the arbitration agreement is null, void, inoperative or incapable of being performed. (Art 8 Model Law) The New York Convention on the Recognition and Enforcement of Arbitral Awards 1958

was given legislative effect in Ireland in the 1980 Act. Section 9 specifies the limited grounds on which enforcement may be refused.

International Arbitration
These arise from disputes in respect of international trade with the facts giving rise to the disputes being similar to those giving rise to national disputes. The difference being that the parties in dispute are of different nationalities or the subject matter of the dispute or the place where the obligation is performed is outside the country the parties have their places of business. More and more disputes are coming within this category as trade grows between Ireland and other EU Member States and indeed the world. Litigation in the international context is slow, cumbersome and expensive and a court order can be difficult to enforce. Arbitration provides a real alternative thanks especially to the New York Convention on the Recognition of International Arbitral Awards 1958 as a successful award is not much good unless you can enforce it/ Enforcement of foreign arbitration awards is a matter for the State where enforcement of an award is being sought. The New York convention was drafted in order to make recognition and enforcement of foreign awards simpler and sets out the internationally accepted rules for the recognition and enforcement of arbitral awards but the enforcement procedure laid out in the convention is only available in countries that have adopted the convention. The New York Convention has been ratified by over 90 states. The New York Convention was given legislative effect in Ireland in the 1980 Act. S8 of the 1980 Act requires any person seeking to enforce an award to which the New York Convention applies to produce:(1) the duly authenticated original award or a duly certified copy, .(2) the original arbitration agreement or a duly certified copy, (3) a certified translation if either of the above is in a language other than Irish or English. Section 9 specifies the limited grounds on which enforcement may be refused. It may only be refused at the request of the person against whom enforcement is sought if that person can prove that for instance: a. a party to the arbitration agreement is under some incapacity b. the arbitration agreement is not valid under the law to which the parties

subjected it c. a party was not given proper notice of the proceedings d. the award deals with matters not within the arbitration agreement e. the arbitral tribunal was improperly constituted or f. the award is not yet binding on the parties or has been set aside by a competent authority (S9(2) 1980 Act or Art V Convention) Enforcement may also be refused if the competent authority where it is sought to enforce the award finds that the subject matter is not capable of settlement by arbitration or contrary to public policy under the law of that country. (Article V(s) / S 9(3) 1980 Act ________________________________________

_ S.I. No. 41 of 2000 ARBITRATION ACT, 1980 (NEW YORK CONVENTION) ORDER, 2000. S.I. No. 41 of 2000. ARBITRATION ACT, 1980 (NEW YORK CONVENTION) ORDER, 2000. I, BRIAN COWEN, T.D., Minister for Foreign Affairs, in exercise of the powers conferred on me by section 6, subsections (2) and (3) of the Arbitration Act, 1980 (No. 7 of 1980) , hereby order as follows: 1. This Order may be cited as the Arbitration Act, 1980 (New York Convention) Order, 2000. 2. It is hereby declared that each state specified in the Schedule to this Order is a party to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards done at New York on 10 June, 1958. 3. The Arbitration Act, 1980 (New York Convention) Order, 1983 (S.I. 350 of 1983), is hereby revoked. SCHEDULE AlgeriaCosta RicaIsrael Antigua and BarbudaCte d'IvoireItaly ArgentinaCroatiaJapan ArmeniaCubaJordan AustraliaCyprusKazakhstan AustriaCzech RepublicKenya

BahrainDenmarkKuwait BangladeshDjiboutiKyrgyzstan BarbadosDominicaLao People's BelarusEcuadorDemocratic Republic BelgiumEgyptLatvia BeninEl SalvadorLebanon BoliviaEstoniaLesotho Bosnia andFinlandLithuania HerzegovinaFranceLuxembourg BotswanaGeorgiaMadagascar Brunei DarussalamGermanyMalaysia BulgariaGhanaMali Burkina FasoGreeceMauritania CambodiaGuatemalaMauritania CameroonGuineaMexico CanadaHaitiMonaco Central AfricanHoly SeeMongolia RepublicHungaryMorocco ChileIndiaMozambique ChinaIndonesiaNepal ColombiaIrelandNetherlands New ZealandSan MarinoTrinidad and Tobago NigerSaudi ArabiaTunisia NigeriaSenegalTurkey NorwaySingaporeUganda OmanSlovakiaUkraine PakistanSloveniaUnited Kingdom

PanamaSouth AfricaUnited Republic of ParaguaySpainTanzania PeruSri LankaUnited States of PhilippinesSwedenAmerica PolandSwitzerlandUruguay PortugalSyrian Arab RepublicUzbekistan Republic of KoreaThailandVenezuela Republic of MoldovaThe Former YugoslavVietnam RomaniaRepublic ofYugoslavia Russian FederationMacedoniaZimbabwe.

GIVEN under my Official Seal, this 4th day of February 2000. BRIAN COWEN, T.D., Minister for Foreign Affairs. EXPLANATORY NOTE. (This note is not part of the Instrument and does not purport to be a legal interpretation.) The effect of this Order is to specify the states which are parties to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, done at New York on 10 June, 1958. _____________________

International Arbitration Institutions There are many international arbitration institutions. The International Chamber of Commerce (ICC) was founded in 1919 and is based in Paris where it established the Court of Arbitration in 1923 the court supervises each case including the appointment of the arbitral tribunal (which decides the case), the conduct of the proceedings and the validity of the award. They also recommend a specific arbitration clause. The London Court of International Arbitration (LCIA) it was founded in 1892 and provides rules and facilities for international arbitration. A joint committee of management composed of representatives of the Chartered Institute of Arbitrators, the Corporation of the City of London, the London Chamber of Commerce and Industry supervises the LCIA. It has 24 leading international arbitrators drawn from different countries.

The International Centre for the Settlement of Investment Disputes (ICSID) This was established in 1966 pursuant to the Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States of 1965 and it operates under the auspices of the World Bank. Ireland gave effect to this convention under the 1980 Act. ICSID arbitration is applicable only where at least one party to the dispute is a state that has ratified the convention. Many trading centres have developed their own international facilities eg Japan Netherlands, even Ireland the Dublin International Arbitration Centre was established in 1998. ______________________________________

The Arbitration (International Commercial) Act 1998 This adopted with a few amendments the UNCITRAL model law on international commercial arbitration into Ireland (see s4 of the Act) and introduces some additional features. The text of the Model Law is set out in full in a schedule to the act. The Model law was drafted by UNCITRAL to harmonise the settlement of international trade disputes. The model law provides very limited rights of access to the courts. The effect of the 1998 Act is that Irish Law now draws a distinction between domestic and international arbitrations and the Arbitration Acts 1954 and 1980 do not apply to international commercial arbitrations as defined in the 1998 Act.

Arbitration is international per the Model Law (Art 1(3) if:(a) the parties to an arbitration agreement have, at the time of the conclusion of that agreement, their places of business in different states; or (b) one of the following places is situated outside the state in which the parties have their places of business; (i) the place of arbitration if determined in, or pursuant to the arbitration agreement (ii) any place where a substantial part of the obligations of the commercial relationship is to be performed or the place with which the subject matter of the dispute is most closely connected; or (c) the parties have expressly agreed that the subject-matter of the arbitration agreement relates to more than one country. Commercial per the footnotes to UNCITRAL Model Law covers matters arising from all relationships of a commercial nature, whether contractual or not. Main features of arbitration under the 1998 Act are that of the Model law which is flexibility and freedom. The arbitration agreement must be in writing. A court must stay litigation before it unless the arbitration agreement is null, void, inoperative or incapable of being performed. (Art 8 Model Law) The model law presumes there will be 3 arbitrators in default of agreement and where there is a failure to appoint an application can be made to court (but most institutional arbitrations have rules which deal with composition of the tribunal and conduct of the proceedings). There are procedures in place to challenge an arbitrator for bias ( lack of impartiality) Per the Model Law the arbitrator can rule on his own jurisdiction including ruling on the existence and validity of the arbitration agreement.. The award must in writing, signed and state reasons (unless it is otherwise agreed).

One can apply for Judicial review of the award within 3 months of receiving it for limited grounds which include:a. evidence is supplied by one party that another party to the agreement is incapacitated or the agreement is not valid under the governing law. b. The court finds the subject matter of the dispute is not capable of settlement by arbitration under the applicable law c. The court finds that th award is in conflict with public policy.

Features of the 1998 act that are in addition to the Model Law S8 allows the tribunal to direct witnesses be examined on oath or affirmation and administer the oaths or affirmations S9 allows parties to arbitration to agree to consolidate arbitration proceedings or run them concurrently (unless there is agreement the arbitration does not have that power). S10 provides that in default of agreement the tribunal has wide powers to award simple and compound interest. S11 provides that the parties are free to agree how the cost of the arbitration including the arbitrators fees are dealt with, and in the absence of agreement the arbitrator costs are up to the arbitrator. S12 provides for immunity from suit for the arbitrator save where he acted in bad faith. That immunity also covers agents/advisors of the arbitrator and expert witnesses. Thus there is a distinct difference in Irish law between International and Domestic Arbitration since the 1998 Act as there were a number of features of the 1954 Act which were unattractive from the point of view of International Arbitration ( eg Case stated procedure) which should encourage the use of Dublin as a centre for international arbitration. __________________________________________