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Arbitral proceedings

Starting an arbitration proceeding
What is needed to commence arbitration?

Unless otherwise agreed by the parties (eg, via the rules of an arbitration institution that have been agreed in the arbitration agreement), the arbitration proceedings are commenced when one of the parties sends a notice in writing to the other party:

  • requiring that party to appoint an arbitrator or agree to the appointment of an arbitrator; or
  • where an arbitrator is named in the arbitration agreement, submitting the matter set out in the notice to the person so named.

Where the arbitrator or arbitrators are to be appointed by a third party, proceedings are commenced when one party gives notice in writing to that third party requesting it to make the appointment in respect of that matter (Section 14).

Limitation periods
Are there any limitation periods for the commencement of arbitration?

There are no limitation periods for the commencement of arbitration, unless provided for in the arbitration agreement. If the parties have agreed to a limitation period, the court may at its discretion extend such period (Section 12). The ordinary limitation periods applicable to legal proceedings also apply to arbitration proceedings (Section 13). Thus, for purely contractual claims, the limitation period is six years (12 years if the contract is under seal) from the date of the breach; and for non-contractual tortious claims, the limitation period is six years from the date on which the cause of action accrued (subject to the rules on personal injury, latent damage and knowledge of the accrual of the cause of action). If the contract is governed by a foreign law, the limitation period(s) of that law should apply.

Procedural rules
Are there any procedural rules that arbitrators must follow?

Arbitrators must abide by the procedural rules agreed upon by the parties, including the arbitration rules under which the tribunal must conduct the case. The tribunal remains subject to the general duties under Section 33. The tribunal enjoys extensive powers to decide all procedural and evidentiary matters, subject to the right of the parties to agree on any matter (Section 34).

Dissenting arbitrators
Are dissenting opinions permitted under the law of your jurisdiction?

The right of an arbitrator to issue a dissenting opinion is recognised in this jurisdiction, and there is no prohibition under English law against a dissenting opinion being produced and delivered by a member of the tribunal. Although not a rule or even standard practice, it also is not unusual for arbitrators to consider themselves under a duty to inform the parties of the reasons for their dissent.

Judicial assistance
Can local courts intervene in proceedings?

English courts may rule on the substantive jurisdiction of the tribunal (under Sections 32 and 67) where the necessary conditions are met. English courts may also intervene to assist arbitration proceedings by, among other things, making orders requiring a party to comply with a peremptory order made by the tribunal (eg, in evidentiary matters).

Can the local courts assist in choosing arbitrators?

Where there has been a failure of the procedure for the appointment of the tribunal, the parties are free to agree under Section 18(1) what is to happen. In principle, the parties may agree in those circumstances that an arbitrator is to be appointed by the court. Further, if there is no agreement, any party to the arbitration agreement may apply to the court to exercise its powers, which include powers:

  • to give directions as to the making of any necessary appointments;
  • to direct that the tribunal shall be constituted by such appointments as have been made;
  • to revoke any appointments already made; and
  • to make any necessary appointments itself (Section 18).

What is the applicable law (and prevailing practice) where a respondent fails to participate in an arbitration? Can they compel parties to arbitrate? Can they issue subpoenas to third parties?

Where a respondent fails to participate in arbitration without sufficient cause, the tribunal may proceed to an award on the basis of the evidence before it. In those circumstances, the tribunal will provide a full opportunity to the party in default to participate before making an award in its absence on the basis of the evidence before it (Section 41(4)), including making a peremptory order against the defaulting party and prescribing such time for compliance with it as the tribunal considers appropriate.

The tribunal has no power to compel a third party to attend a hearing. Similarly, a court has no power in respect of third parties which are not party to the arbitration agreement, save for its power to secure the attendance of witnesses (under Section 43).

Third parties
In what instances can third parties be bound by an arbitration agreement or award?

English law requires the consent of a party in order for that party to be bound by an arbitration agreement or award. English law does not recognise the group of companies doctrine. However, as a matter of English law, where contractual rights are assigned or novated, the assignee or incoming party will usually be bound by any applicable arbitration agreement contained in the original contract. Similarly, subrogated insurers or other third parties may be bound by any arbitration agreement that applies to the subrogated rights or claims. Finally, non-parties to a contract may be able to invoke or be bound by an arbitration agreement contained in a contract where that party has, or has assumed, rights under that contract pursuant to the Contracts (Rights of Third Parties) Act 1999.

An arbitration award is binding on parties who claim a title or right under, through or on behalf of another party. This includes:

  • ancestors and heirs;
  • successors to rights and/or liabilities; and
  • trustee beneficiaries.

Although not binding on third parties, an award may produce an effect on third parties (eg, the finding of liability of a debtor may affect a guarantor not bound by the arbitration agreement).

Default language and seat
Unless agreed by the parties, what is the default language and location for arbitrations?

There is no default language or location under the Arbitration Act 1996. In the absence of agreement between the parties, the tribunal has discretion to decide the language and the seat of the arbitration proceedings (Sections 3 and 34(2)(a) and (b)).

Gathering evidence
How is evidence obtained by the tribunal?

This is a matter, subject to any agreement of the parties, that falls within the procedural discretion of the tribunal. The tribunal typically obtains evidence pursuant to exhibited and/or other documentary evidence, filed witness statements, filed expert reports and oral evidence given by witnesses and experts, as well as site visits.  It also has the power to appoint experts, whether legal or technical.

What kinds of evidence are acceptable?

The tribunal has broad discretion to decide on evidentiary matters, including whether to apply strict rules of evidence (or any other rules) as to the admissibility, relevance or weight of any material (oral, written or other) sought to be tendered on any matters of fact or opinion, and the time, manner and form in which such material should be exchanged and presented (Section 34(2)(f)).

Confidentiality
Is confidentiality ensured?

The Arbitration Act 1996 does not expressly provide for confidentiality in arbitration proceedings. However, subject to the parties’ express agreement in relation to confidentiality, under English common law there is an implied duty of confidentiality in all arbitration agreements. This duty arises from the concept of the essentially private nature of arbitration (see Emmott v Michael Wilson & Partners Ltd [2008] 1 Lloyd’s Rep 616 (CA)).

Can information in arbitral proceedings be disclosed in subsequent proceedings?

The confidentiality of arbitration proceedings is not protected in the following circumstances:

  • The parties agree otherwise;
  • There are parallel or subsequent court proceedings or subsequent arbitral proceedings;
  • The party that originally produced the material has consented to disclosure;
  • Matters relating to the arbitration are the subject of court proceedings (eg, as a result of a party’s application to the court for preliminary relief, enforcement or appeal);
  • It is reasonably necessary for the protection of the legitimate interests of an arbitrating party; or
  • Disclosure is otherwise necessary in the interests of justice.

Ethical codes
What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your jurisdiction?

Solicitors of England and Wales, registered foreign lawyers and registered European lawyers are bound by the Solicitors’ Regulation Authority (SRA) Handbook 2011 (including the SRA Code of Conduct 2011).

Barristers of England and Wales are subject to the Code of Conduct of the Bar of England and Wales.

These codes do not apply to foreign lawyers who are not registered as foreign or European lawyers, or to other professionals involved in arbitration proceedings in England.

The new rules of the London Court of International Arbitration (LCIA) contain conduct standards that will apply to all representatives in LCIA arbitrations.  

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