May 30 (Part 1)

Wednesday, May 30, 2012 9:14 AM

Enforcement Becomes relevant when A goes to court, and B takes position that action is done in violation of arb agreement. B has choice to either take A s offer to go to court or to push for arbitration Art 8 (1) - The timeliness requirement A procedural rule that puts burden on defendant to mk decision promptly as to whether he wants to force arb or not

Timeliness requirement "raison d'etre" - efficiency, fairness, public interest w regards to sources to go to court

Gigandra case Whether defence had submitted first statement in a timely fashion. What was first statement in substance of dispute? D contests claimants right to obtain interim judgment . It was made only after order was made So the question is whether it was made within meaning of art 8 Court concludes that it was. D was out of time and couldnt invoke the arb agreement. Here court puts a heavy burden on defendant Gotta be careful with this, judges might touch a bit of the merits Bab Systems or Runkole? Clarify this Whether first statement on substance of dispute is the statement that you mk in judicial proceedings or the one that you make in the arbitral proceedings Court said that the one that matters in the one on arbitral proceedings Since statement was timely, therefore the court could refer the entire case to arbitration Prof thinks this doesnt make sense. Runkole prof this is much more convincing Art 1 (2): Note that art 8 applies irrespective of the seat of arbitration. It is an exception to the gral rule Makes sense when parties undertake - Judicial intervention What is the role that courts play before an award has been awarded? Distinguish b court control of and assistance to the arbitral process. You look at control first and then to assistance We need to keep in mind a key provision --> art 5. It is there to prevent court from intervening except where is provided in the ML. Predictability, and to force legislator to list all instances where court can intervene Look at ML, if you dont find anything then court has no power to intervene However there are some matters that are not governed by ML and courts could intervene even if not in ML. For example, action against arbitrator (malpractice). Travaux preparatoires: impact of state immunity, kual relations b/ parties and arbitrators or arb institution, fees and other costs See Air France on art 5 Remember ML is only concerned w court intervention w regards to arb proceedings? Control 2 aspects of arbitral process which can be controlled pre-award. 1. Jurisdiction o whether claim of dispute falls within ambit of arb agreement. o ML takes a different approach depending of who is objecting (def/claimant) Art 8 - Claimant objects to arb jurisdiction


a.

Art - Respondent objecting

Claimant objection A v B action in court. B asserts that parties are under duty to arbitrate. A disagrees and argues arb agreement is either: 1) non-existent; 2) invalid or 3) inapplicable Court would first look at whether falls within arb agreement. Then would look if is void, inoperative or incapable of being informed (art 8 (1) Court seized of art 8 (!) gives court power to rule on this

What is extent court should rule on arbitral jurisdiction? (Pacific Crown, Barnmore, Dell) Pacific and Barnmore you see different conceptions of rule of the court on this matter: In Pacific, prima facie assessment of resp argument. Unless court is convinced that party is right, court would send matter to arbitraton In Barnmore, full and final assessment of R;s argument . Here role is to look at matter fully as a matter of fact and law Dell - this case is in between the 2 previous approaches. It favors prima facie but w an important exception. To effect that in debate on jurisdiction point, if that pnly raises questions of law, court would rule in final matter. If there are questions of fact, court would only look in prima facie matter. In order to decide who is right we need to look at principles, objectives, and so on. Art 8 doesnt speak to the extent to which courts should engage on this. What is rationale in each approach? PF: makes art 8 application much simpler, less costly, more easy to dispose by courts. Minimizes role of court, easier to get parties to go to arbitration. Full and final review: as a matter of policy, the argument is we--we give precedence to -- lets seethat they are doing this for good reason, investment. Check recording. Risk: . Downside: Under this approach, court needs to look at al larg, needs to fully consider the jurisdiction issue. If one of parties is acting in bf and just wants to get out of arb. You are giving a lot of ammunition to a claimant to raise jurisdiction issues for purely tactical reasons. Opens door to tactically dilatory manner PF but exc on matters of law: End of day, comes down to which we think is more compelling starting point of analysis. If we presume GF, we prefer Barnmore full, final review approach. Which law will court apply to resolve jurisdictional debate? Art 8 is silent on this. UNCITRAL decided not to comprehensibly regulate manner in which parties - As a gral rule, validity of arb agreement is governed by law chosen by the parties, or absent any choice by law of the seat Exception: Subject matter arbitrability governed by local law. e.g. A from UK sues B from QC in QC but says NY seat. NY to interpret matters of --- If matter is related to bankruptcy, cant apply NY law but rather QC law. Public order puts limits to arbitrator In sum, there are indirectly relevant but nothing specific b.

Def objection issue: WHETHER respondent will be able to go to court, to bring jurisdiction objection. Will ccourt prevent from going to arb in manner of injunction In US, you are allowed to go right away to judge right after receiving a notice of arbitrayion. In Netherlands: opposite. You have to arbitrate entire thing, get an award before court can step in GER/UK: hybrid approach - before taking steps in arb proceedings, party can go to court. Window opens from moment you receive the notice of arbitration. What is the ML approach? Art 16: cant go to court right away. You must first present to arbitrator your objection. Then arbitration decided, w discretionary power, to determine whether arb will rule right away the jurisdictional point or whether will give that decision with the merits. If arb upholds jurisdiction, and dismisses objection. Party is allowed to go directly to court to have that juri issue reviewed by judge. As a prelim question: you can go to court within 30 days to decide the matter As a merit assessment: 2 requirements: 1) object to arbitrator, 2) objection must have been dismissed by arbitrator

However, if arbitrator says, yeah I have no jurisdiction. Art 16 ML says nothing as to whether you can go to court, inmediate court ruling Clarify this!! Is a ruling by arbitrator denying arb jurisdiction final and unreviewable? No PT Asurandi Case (Singapore) adopted internationalist approach to art 16. Court concluded that because art 16 says nothing about negative jur ruling, means that ruling is final and binding. Clear from point of view of 16(3) + travaux preparatoires Is this satisfactory? What is arbitrator got it wrong or applied wrong law? It is hard to mk a compelling arg that review of negative jud ruling is not a matter of ML. Based on notion that a judge cannot force arbitrator to hear a case, after arbitrator has declined jurisdiction. Bachand doesnt find a problem w this, if arb doesnt want to to take it, you send it to another arbitrator. Bachand argues that from pro-arb approach, to make this final and unreviewable is not in accordance w will of parties, freedom to k? to arbitrate? Check the exact words used

German case E Singapore case Court can still intervene, modifies art 16 Ace Bermuda Under which standards should court review arb jur rulings? I can bring positive/negative ruling to court. How will court look at this? Will court look at it on a deferential standard? Will it be set aside on basis of mere error law/fact or unreasonable, (deferential v noble) Court s stance on applicable standard is that court should take deferential stand. A standard should be one of reasonableness, deference and respect to decision of arbitrator." It is widely recognized that we respect and dont intervene on merits of arbitrators decision. It assumes that this reasoning is equally valid and justified w respect to jurisdictional rulings of arbitrators Bachand says this doesnt make sense. Reasonableness, deference and respect implies that court can step in when is unreasonable. That to Bachand is a merit review, which is inconsistent w NY convention, which says no merit review should take place