One may consider the idea of a well-behaved lawyer or expert a contradiction in terms. It has been said that ‘about trials hang a suspicion of trickery and a sense of a result depending on cajolery or worse’. That may be a cynical view, but the fact is that lawyers and experts are instructed and paid by their clients in the hope that they will assist the client to prevail. It is certainly the case for lawyers that their remuneration is often partly or entirely linked to whether or not the case is won and for both lawyers and experts, the prospect of repeat business from the client is much more likely to follow on from success as opposed to failure.
The drive for success will invariably affect the manner in which the parties' lawyers lay all the relevant facts before the court which in turn will impact on the ability of the judge or tribunal to administer justice. The maxim ‘truth is best discovered by powerful statements on both sides of the question’ is right, but only to the extent that lawyers and experts act honestly, ethically and in accordance with the rules and provided they do not – knowingly or recklessly, directly or indirectly – procure or deliver evidence to the court in an improper way. That said, it is simply human nature to test the boundaries as far as possible and so it must follow that clear rules need to be in place that define the boundaries of how lawyers and experts may act and which set out the powers available to a tribunal to enforce them.
This is a fascinating topic, but also an enormous one, and so what follows is limited to an overview of only some of the issues on this subject. The first half of the paper defines ‘good’ behaviour by reference to standards that apply or may apply to lawyers admitted in England and Wales in domestic and international arbitration. It summarises some of the things typically considered to be ‘bad’ behaviour, then considers what sanctions and measures are available to an arbitral tribunal along with some selected case law. The second half of the paper will follow the same structure as applied to experts.
The position in domestic litigation is reasonably clear. The source of the duty to the court lies in public interest and the court, in enforcing it, is acting as a guardian of the due administration of justice. The courts have therefore assumed an inherent power to impose these duties. The principle is that “the court has a right and duty to supervise the conduct of those appearing before it, and to visit with penalties any conduct of a lawyer which is of such a nature as to defeat justice in the very cause in which he is engaged professionally.” The general duties are supplemented in England and Wales by the Civil Procedure Rules which give the court wide-ranging powers to deliver a whole range of procedural and even criminal sanctions, such as contempt of court or perjury.
In contrast, the position in domestic and international arbitration is less clear. This is ultimately because the parties have autonomy on whether to arbitrate their disputes and if they choose to arbitrate, what rules will apply in that arbitration. Nevertheless, the scale of autonomy is clipped to a greater or lesser degree by mandatory legislation governing the rules and conduct of arbitration.
In England, with regard to lawyers conduct, the autonomy is fairly wide. The Arbitration Act and most major institutional arbitration rules contain no specific requirements for lawyers representing parties in an arbitration. Indeed all that the rules say are that the parties have a right to be represented by an individual, whether legally qualified or not and subject to proof of authority, if required. The exception to this is the most recent version of the LCIA rules which came into effect on 1 October 2014. Annex 1 contains rules to which all legal representatives are required to comply, which includes rules against making false statements, concealment of documents and procurement of misleading evidence.
Those rules are stated to be subservient to national codes of conduct. Solicitors admitted in England and Wales are subject to the Solicitors Regulation Authority’s (‘SRA’) Handbook (the ‘SRA Handbook’) and barristers are governed by the Bar Standards Boards (‘BSB’) Handbook (the ‘BSB Handbook’), which includes the code of conduct for the Bar of England and Wales, but there is some debate as to whether the SRA Code applies to domestic and international arbitration.
The SRA Handbook’s overarching principles provide that they apply to all activities regulated by the SRA and that they ‘underpin all aspects of practice’. The SRA Handbook contains a code of conduct which is split into mandatory provisions and indicative behaviours, all of which flow from these overarching principles. Chapter five of the code deals specifically with duties in relation to the courts. The ‘court’ is defined in the glossary as ‘any court, tribunal or inquiry of England and Wales, or a British court martial, or any court of another jurisdiction’. Some argue that a ‘tribunal or inquiry of England and Wales’ does not cover an arbitral tribunal either constituted by a foreign nominating body and/or where the seat of the arbitration is outside of England and Wales.
The position for barristers is clearer. The BSB Handbook clearly applies to barristers acting in both domestic and international arbitration. It states that the core duties apply to all BSB regulated persons. ‘BSB regulated persons’ is defined as ‘BSB authorised individuals’ which in turn is defined as all barristers admitted in England and Wales. The duties apply when providing ‘legal services’, a term which is defined as including ‘legal advice representation and drafting or settling any statement of case witness statement affidavit or other legal document’. This very broad definition must capture representation and documents produced in both a domestic and international arbitration forum, a view which is supported by a further rule which states that the BSB Handbook applies to all barristers when providing legal advice. Rule C1, ‘You and the court’, is the rule which imposes specific duties on barristers when acting in a court. ‘Court’ is defined as meaning ‘any court or tribunal or any other person or body whether sitting in public or in private before whom a barrister appears or may appear as an advocate’. Thus a ‘tribunal…sitting in private’ must surely contemplate both domestic and international tribunals.
Both the SRA and BSB Handbook concern broadly similar principles. These include:
- upholding the rule of law and the proper administration of justice;
- acting with integrity;
- not allowing one’s independence to be compromised;
- acting in the best interests of each client;
- providing a proper standard of service to one clients; and
- behaving in a way that maintains the trust the public places in you and in the provision of legal services.
Perhaps unsurprisingly, there have been no reported cases in England and Wales dealing with the application of any of the codes of conduct or sanctions to arbitration. Outside the closed doors of arbitration, the administration of punishment on solicitors or barristers when the codes of conduct are breached, though not available to the tribunal, is of course available to the BSB and the SRA.
National codes of conduct aside, a more interesting area concerns the standards that apply in international arbitration. Often those arbitrations involve lawyers from different jurisdictions where different national codes of practice apply. In England and Wales, the SRA seems to acknowledge its rules are not fit for purpose on an international platform, as demonstrated by a consultation carried out in 2011 and 2012, which was aimed at determining how the SRA might regulate international practice. No conclusions have been reached to date. For some time, industry bodies have promoted the idea of a multinational mandatory code of conduct that regulates the conduct of lawyers but the source of the problem has been the barrier to a one size fits all solution. In 2013,the International Bar Association published helpful Guidelines on Party Representation in International Arbitration (the ‘2013 Guidelines’) which provide for a code of conduct to which it is suggested counsel should adhere. They apply when the parties agree or where the tribunal has authority to rule on matters of party representation, and how party representatives may interact with the expert.
What do we mean by bad behaviour? In the context of lawyers interaction with experts, it includes things like:
- coaching the expert;
- outside influence: lawyers either writing the expert’s report for him or ‘suggesting’ amendments to opinions expressed, or asking for section of the report to be removed; 
- interference with joint experts’ meetings;
- interference with joint experts; 
- lawyers withholding information, either from their own expert or from the other party’s expert;
- lawyers or their clients undertaking the analysis of the facts and providing their analysis as the only basis for the expert to form his opinion from (often the reason stated for this is said to be a saving on costs); and
- lawyers providing a restrictive brief to their expert which ultimately impinges on his credibility.
Of all the sources of naughtiness, one which arises time and again is the question of witness coaching, be it expert or factual. This is one of the issues that highlights the problems with different national practices. In England and Wales, witness coaching is considered unlawful, but in the United States for instance, it is common practice for attorneys to intensively prepare witnesses such that a failure to do so can amount to negligence on the part of the lawyer. The 2013 Guidelines seem to fan the flames of uncertainty by permitting witness preparation, without prescribing how far lawyers can go. Institutional rules vary: the LCIA and SIAC rules permit lawyers to interview witnesses whereas the ICC rules are silent on this point.
What can the tribunal do about bad conduct? Since the tribunal derives its powers entirely from the rules of the arbitration, any sanctions it can levy will be determined by reference to those rules, or by reference to rules incorporated into the arbitration by agreement (such as the 2013 Guidelines). Of all of the rules, the latest edition of the LCIA rules arguably goes the furthest. The key provisions are contained within article 18.
18.5 Each party shall ensure that all its legal representatives appearing by name before the Arbitral Tribunal have agreed to comply with the general guidelines contained in the Annex to the LCIA Rules, as a condition of such representation. In permitting any legal representative so to appear, a party shall thereby represent that the legal representative has agreed to such compliance.
18.6 In the event of a complaint by one party against another party’s legal representative appearing by name before the Arbitral Tribunal (or of such complaint by the Arbitral Tribunal upon its own initiative), the Arbitral Tribunal may decide, after consulting the parties and granting that legal representative a reasonable opportunity to answer the complaint, whether or not the legal representative has violated the general guidelines. If such violation is found by the Arbitral Tribunal, the Arbitral Tribunal may order any or all of the following sanctions against the legal representative: (i) a written reprimand; (ii) a written caution as to future conduct in the arbitration; and (iii) any other measure necessary to fulfil within the arbitration the general duties required of the Arbitral Tribunal under Articles 14.4(i) and (ii).
Whilst this enhanced granularity is welcome, the sanctions at clause 18.6 arguably amount to nothing more than a slap on the wrist and are therefore unlikely to control attitudes of counsel. Sanctions set out in other institutional rules are more general in nature:
- ICC Article 22(2): ‘In order to ensure effective case management, the arbitral tribunal, after consulting the parties, may adopt such procedural measures as it considers appropriate, provided that they are not contrary to any agreement of the parties.’
- UNCITRAL Article 17.1: ‘Subject to these Rules, the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate, provided that the parties are treated with equality and that at an appropriate stage of the proceedings each party is given a reasonable opportunity of presenting its case. The arbitral tribunal, in exercising its discretion, shall conduct the proceedings so as to avoid unnecessary delay and expense and to provide a fair and efficient process for resolving the parties’ dispute.’
- SIAC Article 16.1: ‘The Tribunal shall conduct the arbitration in such a manner as it considers appropriate, after consulting with the parties, to ensure the fair, expeditious, economical and final determination of the dispute.’
- Arbitration Act section 34(1): ‘It shall be for the tribunal to decide all procedural and evidential matters, subject to the right of the parties to agree any matter.’
The 2013 Guidelines, though not necessarily mandatory, are more prescriptive. Article 26 suggests four remedies which should be available to the tribunal, which are:
- admonish the lawyer;
- draw appropriate inferences from evidence or legal arguments;
- consider the misconduct in apportioning costs; and
- any other measure in order to preserve the fairness and integrity of the proceedings.
With the exception of the award of costs against the offending lawyer’s client, the sanctions (such as they are) that actually bite are aimed either at the expert or the evidence. Is that right? When an expert says, in defence of criticism “he only did what he was instructed to do”, perhaps the criticism should only be levelled at the lawyer? But this outcome is rarely the case, it is submitted. The tribunal will rarely criticise the legal team’s infelicitous treatment of the expert or his evidence, rather it will target the expert or the evidence itself. In extreme situations, the other party may make an application to have the evidence excluded, or the tribunal may decide to do so on its own accord. It is suggested that the rules and sanctions in domestic and international arbitration as to the conduct of lawyers have some way to develop before they are clear and effective.
Case law addressing lawyer misdemeanours is hard to come by owing to the confidential nature of arbitral proceedings in most jurisdictions. The notable exception is of course ICSID, which publishes some awards produced pursuant to its rules. These give us some insight into how a tribunal has dealt with lawyer misconduct. Two areas of interest are the power to disqualify a lawyer from proceedings and sanctions applied to lawyers.
With regard to the first, there are conflicting authorities on the extent to which this is something that falls within the remit of the arbitral tribunal’s jurisdiction as opposed to a matter reserved for the national courts. In Hrvatska Elektroprevida v Republic of Slovenia, the tribunal disqualified a lawyer from the proceedings due to a perceived lack of independence. Here the respondent had appointed a counsel of the same chambers (Essex Court Chambers) as the president of the Tribunal. The claimant objected on the grounds that they were only informed about this at a very late stage in the proceedings (about two weeks before the hearing was to take place) and that they were not satisfied that this would not compromise the independence of the president of the tribunal. The respondent explained that they had not in fact retained the counsel in question until a short time before the fact was communicated to the tribunal. The arbitral tribunal ruled that though there is a fundamental right for parties to choose their own representation freely, it would in this case have to give way to the overriding principle of the tribunal’s immutability. Thus the counsel was barred from participating further in the proceedings. In contrast, in The Rompetrol Group N.V. v The Republic of Romania the arbitral tribunal refused to disqualify counsel from proceedings on the basis of potential bias of the tribunal. In this case the respondent tried to have the claimant’s counsel removed on the basis that he had previously been an employee of the law firm at which one of the tribunal members was a partner. The tribunal noted that a claim to remove a party’s counsel should not be used as an alternative to a claim against the tribunal itself and that it was reluctant to encourage any practice which would hold counsel to a standard higher than accepted rules of professional conduct and ethics. Hrvatska Elektroprevida was distinguished on the grounds that there had been late disclosure.
The case of Pope and Talbot Inc. v Government of Canada is an example of an arbitral tribunal demonstrating a willingness to exercise its procedural powers to sanction a party because of the conduct of its lawyers. The respondent’s counsel inadvertently transmitted legal advice given to her client, commenting on the award of the tribunal, to the claimant’s counsel and the tribunal. The claimant’s counsel showed this document of advice (including the tribunal’s order) to a journalist at the Canadian National Post, who referred to it in an article. The arbitral tribunal found this disclosure of confidential material reprehensible and fined the claimant $10,000 which it stated that it expected counsel would ’voluntarily and personally assume’. It also went on to state that it expected that claimant’s counsel would make public this order as he had done with all previous orders, awards and decisions of the tribunal. The case of Victor Pey Casado v Republic of Chile is an example of where costs were imposed because of ex-parte contacts between party and co-arbitrator and resulting delays.
Moving on to experts, what rules or guidelines relate to their conduct? In domestic arbitration, the starting point is CPR 35, its practice direction and the guidance for the instruction of experts in civil claims. The rules and guidelines are familiar to most and represent the most comprehensive source of rules available to UK practitioners. Whilst the rules are only compulsory in litigation, they are often incorporated into bespoke arbitration rules, or the parties agree they shall apply ad hoc.
Those rules were influenced to a significant degree by the Ikarian Reefer case.There, the judge summarised the duty of an expert as “impartial, objective, unbiased and uninfluenced by the pressures of the dispute resolution process or by any party.” Even if CPR 35 does not apply in the arbitration, this and subsequent court guidance that has applied the principles of Ikarian Reefer is generally considered to be persuasive authority in arbitration, having influenced the approach taken by many arbitral panels when faced with challenges to the expert’s conduct.
Next, codes of practice. The Academy of Experts produces one such code setting standards for experts which requires a prevention of anything which impairs the expert’s independence, objectivity and integrity, impartiality and which causes a conflict of interest.
- Experts shall not do anything in the course of practising as an expert, in any manner which compromises or impairs or is likely to compromise or impair any of the following:
- the expert’s independence, impartiality, objectivity and integrity;
- the expert’s duty to the court or tribunal;
- the good repute of the expert or of experts generally;
- the expert’s proper standard of work; and
- the expert’s duty to maintain confidentiality.
- An expert who is retained or employed in any contentious proceeding shall not enter into any arrangement which could compromise his impartiality or make his fee dependent on the outcome of the case nor should he accept any benefits other than his fee and expenses.
- An expert should not accept instructions in any matter where there is an actual or potential conflict of interests. Notwithstanding this rule, if full disclosure is made to the judge or to those appointing him, the expert may in appropriate cases accept instructions when those concerned specifically acknowledge the disclosure. Should an actual or potential conflict occur after instructions have been accepted, the expert shall immediately notify all concerned and in appropriate cases resign his appointment.
- An expert shall for the protection of his client maintain with a reputable insurer proper insurance for an adequate indemnity.
- Experts shall not publicise their practices in any manner which may reasonably be regarded as being in bad taste. Publicity must not be inaccurate or misleading in any way.
- An expert shall comply with all appropriate Codes of Practice and Guidelines.
The Chartered Institute of Arbitrators has also produced a protocol for party appointed experts in international arbitration. In its words:
It provides a complete regime for the giving of such evidence and provides a procedure for identifying the issues to be dealt with by way of expert evidence, the number of experts, their identity, what tests or analyses are required, the independence of the experts, the contents of the experts’ opinions, privilege, meetings of experts and the manner of expert testimony.
Whilst these codes of practice are not binding on an arbitral tribunal, they may be made so if the parties agree.
The Royal Institute of Chartered Surveyors (‘RICS’) published the fourth edition of its practice statement and guidance note entitled ‘Surveyors Acting as Expert Witnesses’ on 4 April 2014, which came into effect on 2 July 2014. Practice statements are mandatory for RICS members, whereas guidance notes are recommended good practice. Whilst enforcement of the rules in the practice statement is only likely to be available to the Institute (unless the parties agree to adopt the practice statement as part of the arbitration rules), the fact that a breach of the rules in the practice statement may lead to expulsion from the professional body is likely to deter bad behaviour.
Next, institutional rules. Specific duties, in the way that CPR 35 contains specific duties, are light on the ground. An area of some interest is the requirement for independence, which one would think is a cornerstone of an expert’s duty. And yet, in the major institutional rules, any express requirement for expert independence seems to be limited to tribunal appointed experts and not party appointed experts. Indeed, UNCITRAL goes further, providing that “expert witnesses…may be any individual, notwithstanding that the individual is a party to the arbitration or in any way related to a party.”The lack of guidance in the institutional rules on this issue and others perhaps reflect the differing practices in different jurisdictions. In civil law jurisdictions in particular, less emphasis is placed on expert witnesses.
Partly because of the lack of granularity in the institutional rules, the IBA Rules on Evidence were introduced in 2010. It is now increasingly common practice for the tribunal to ask the parties to adopt these rules. They address a number of things in detail, including the requirements that an expert report must meet, independence of opinion, conflicts of interest and so on. There is an argument however that by adopting these rules, tribunals take the arbitration process closer to litigation, which some say is a step too far.
The aforementioned rules typically address the standards to which experts must adhere, but what sorts of actions or inaction is commonly encountered that contravenes these standards? As lawyers find numerous ways in which to misbehave, so it would seem do experts. Examples include:
- experts as advocates for their client’s case/lack of independence;
- incentive based fees;
- reports written and opinions formed by assistants instead of the expert;
- lack of objectivity;
- selective use of evidence;
- lack of requisite expertise;
- failure to test the veracity of materials presented to them; and
- following instructions from lawyers instructing them when it is clear on the face of it that what you are being asked to do will not result in a credible reports under scrutiny.
How are these issues addressed? The Arbitration Act 1996, the major arbitration rules and the IBA rules on evidence all contain provisions which gives the arbitrator the discretion to decide the admissibility, relevance or weight given to evidence, including expert evidence.
- LCIA – Article 21.1(f): The Arbitral Tribunal shall have the power ‘to decide whether or not to apply any strict rules of evidence (or any other rules) as to the admissibility, relevance or weight of any material tendered by a party on any matter of fact or expert opinion; and to determine the time, manner and form in which such material should be exchanged between the parties and presented to the Arbitral Tribunal.’
- UNCITRAL – Article 27.4: ‘The arbitral tribunal shall determine the admissibility, relevance, materiality and weight of the evidence offered.’
- SIAC – Article 16.2: ‘The Tribunal shall determine the relevance, materiality and admissibility of all evidence. Evidence need not be admissible in law.’
- SIAC – Article 16.4: ‘The Tribunal may in its discretion ... exclude cumulative or irrelevant testimony or other evidence…’
- Arbitration Act 1996 section 34(2)(f): the tribunal may decide ‘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.’
Although not a remedy available to the tribunal, if an expert has acted improperly, the terms of the expert engagement may not protect the expert witness against a claim for breach of contract or negligence in the event that the expert fails to fulfil his duties in accordance with the applicable rules or guidelines. Furthermore, in such instances, professional indemnity insurance may not provide any or adequate cover.
One solution that is often mooted is to do away with party appointed expert and to only permit tribunal appointed joint experts. The expert would need to be provided with a joint brief and to be paid by the parties jointly. However, although all the main institutional rules provide for it, there has been a paucity of popularity for that type of expert in the UK, perhaps because of reduced control a party has in appointing an individual and providing him or her with instructions together with a view that there is less opportunity to test or challenge a joint expert’s opinion.
Given that tribunals are often persuaded by a court’s interpretation on matters concerning the conduct of experts, it is perhaps useful to consider some of those cases now. First, the matter of the expert as a ‘hired gun’. In Norbrook Laboratories Ltd v Tank the court was reluctant to interfere with this discretionary power of the arbitrator, in a claim challenging the independence of an expert. Indeed the court was of the opinion that any issue of objectivity and independence could be dealt with adequately through the powers already available to the arbitrator. However, inMunkenbeck and Marshall v Kensington Hotel an expert was criticised by the court for losing sight of the proper role of an expert which is to the assist the court, and instead adopted the stance of advocating his client’s case. The court decided that on this basis the value of the expert’s evidence had been greatly diminished. The ‘hired gun’ cases extend beyond cases where the expert assumes the role of an advocate. InRoyal and Sun Alliance Trust Co Ltd v Healy and Baker a valuation expert was held to be extremely selective in his consideration of evidence, again reducing the value of the evidence.
Any public comments can be used to undermine the expert’s credibility in future, regardless of who made them. In Cala Homes (South) Ltd and others v Alfred McAlpine Homes East Ltd the judge decided to dedicate the final part of his judgement to criticising the defendant’s expert. The expert in question was an ‘eminent architect’ with a wealth of experience as an expert witness. Some years prior to this case he had written an article on his perception of the duties of an expert witness, which advocated a somewhat adversarial approach. This article was summed up by the judge when he described the experts’ use of the term ‘pragmatic flexibility’ as a euphemism for ‘misleading selectivity’. In light of this he decided to attach very little significance to the particular expert witness.
Experts should ensure they have sufficient expertise in the subject matter they are asked to give an opinion on. The recent Privy Council case Caribbean Steel Company Ltd v Price Waterhouse (a Firm) confirmed that the court may attach less weight, or reject an experts evidence entirely, once it has properly considered it.
Lastly, one frequently cited case that acts as an example of a shopping list of what not to do as an expert is that of Great Eastern Hotel Company Ltd v John Laing Construction Ltd and Laing Construction Plc. Here, programming experts were appointed by both sides to analyse the critical path of a construction project. The judge was less than impressed by the defendant’s expert concluding that little weight could be attached to his evidence and preferring the evidence of the claimant’s expert on all possible occasions throughout the judgment. The judge went on to criticise the expert for being naïve, making fanciful statements, having a lack of knowledge of the facts, conducting insufficient research, submitting incomplete analyses, uncritically accepting statements made by the defendant, omitting relevant evidence from his analysis and discussion, being unreliable and under cross examination, denying statements he previously made.
There is no doubt there is a considerable gulf with regard to the prescription and regulation of expert and lawyer conduct between UK litigation and arbitration. Part of the problem is that the lack of judicial precedent in arbitration makes it difficult for there to be any real transparency as to the effectiveness of arbitration rules and the conduct of those participating. A further difficulty lies with the high level of autonomy that parties to an arbitration benefit from. The problem is deeper still in international arbitration: at its core the problem lies with the finding a mutually agreeable common ground amidst a wide spectrum of cultural views as to what is and is not acceptable. In the last five years, the International Bar Association has taken positive steps towards finding a common ground, but their codes have been achieved through a series of compromises that for some has resulted in a watering down of what might otherwise have been well defined rules and imposing sanctions. It is hoped that in the next five years, revisions to the codes of conduct, the amendment of institutional rules and legislative reform will move us closer to arbitration regimes that are better able to prescribe, capture and admonish lawyers and experts behaving badly.