LAW 7065 International Arbitration Law : Essay Fountain

Question:

You are a sole arbitrator in a Scottish seated arbitration. The Claimant has made a written request for a direction from you obliging the Respondent to produce a copy of an arbitral award issued by a different arbitral Tribunal in another case which is related to the one in hand, and in which the Respondent was a party (the Claimant was not). The Claimant argues that although it has not seen the award, it has heard about it and understands that it contains important information about the current case, since it involves a related transaction. The Respondent has indicated that it has nothing to say (except to oppose the request); it is not prepared to even indicate
whether or not another arbitral process, as described, has happened.What do you do?
 
 

Answer:

Introduction:

It is noteworthy to mention that International Arbitration has proved to be beneficial in settling commercial disputes globally (Gaillard, E., 2014). It can be observed that in some cases arbitral award does not involve the requirement of judicial enforcement in cases where both the claimant and the respondent are parties to an arbitration clause. In Prima paint Corp v. Flood & Conklin Manufacturing Co it was observed that the arbitral award directed by a different arbitral tribunal was used as a reference to the present case as both the cases involved same jurisdiction. In this case it was held by the judge that the contract depicted in the arbitration clause can prove to be beneficial for an arbitrator and a court of justice in deciding that whether the case should be decided based on previous decision. It is important on the part of the parties to act in good faith. In Prima paint Corp v. Flood & Conklin Manufacturing Co it was held that the reference of a previous arbitral award shall not be applicable in cases where the parties to arbitration were fraudulently induced into signing the agreement. In this case it held by the arbitrator that if no evidence is found on the part of the respondent then the claim for the opposition of previously issued arbitral award shall be refused.

The Arbitration Act 1996 of United Kingdom provided that an arbitral award is final and binding upon the parties. Therefore, it can be stated that the reference of a previous arbitral award can be presented before an arbitral tribunal. It can be mentioned that various kinds of commercial matters relating to present or future disputes may be presented as reference however, the dispute shall not arise from an illegal transaction (Goode 2014). In this regard it can be noted that in order to constitute the validity of a reference it is essential to mention the existence of a dispute. However, it important that in order make reference of a previous arbitral award, the parties may bind them to a present or future arbitration agreement. It is necessary that the parties involved in arbitration agreement shall act in good faith. In this regard, it is worth noting that if such agreement is related to the dispute at present then in such cases it will amount to reference however, if the purpose was to provide relief to any future dispute, then it constitutes an arbitration clause.

 

In James Miller v Whitworth Street Estates case it has been observed that the parties made reference of a previous arbitral award from a different arbitral tribunal. In the abovementioned case, such reference of arbitral award was held to be legal as the transaction associated with it was not illegal.

In the given scenario it can be seen that the claimant requested to restrain the respondent from producing a copy of an arbitral award that has been previously issued by a different arbitral tribunal. It has been argued by the claimant he did not have any knowledge regarding the contents of the award however, assumes that it contains relevant information about the case. In the present case study it can be observed that though the present arbitration contains vital information about the case however, the transaction involved in this regard is not illegal in nature. In this case, being a sole arbitrator it is essential in his part to review the copy of the previous arbitral award which can act as a reference to the present case (Elsing and Townsend 2014).The sole arbitrator is at the authority to review the copy of the arbitral award presented by the respondent because it was been stated by the respondent that the copy of the previous arbitral award has no information about the case. It can be finally concluded that based on the introductory case studies the sole arbitrator shall accept the previously circulated arbitral award and proceed with the arbitration agreement.

 

References:

Elsing, S.H. and Townsend, J.M., 2014. Bridging the Common Law-Civil Law Divide in Arbitration. Arbitration International, 18(1), pp.59-65.

Gaillard, E., 2014. Transnational Law: A Legal System or a Method of Decision Making?. Arbitration International, 17(1), pp.59-72.

Goode, R., 2014. The role of the lex loci arbitri in international commercial arbitration. Arbitration International, 17(1), pp.19-40.

James Miller & Partners Ltd. Appellants v Whitworth Street Estates (Manchester) Ltd. Respondents [1970] A.C. 583.

Prima paint Corp v. Flood & Conklin Manufacturing Co. 388 U.S. 395 (1967).

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