One of arbitration's cornerstone principles is that parties can agree on how to resolve their disputes. However, parties commonly agree on asymmetric, rather than symmetric, rights. The classic case is where only one party has the right to refer disputes to arbitration, but the other must litigate. Parties wishing to include asymmetric arbitration clauses are advised to consider carefully the courts' approaches to such clauses in all relevant jurisdictions.
In a recently published decision, the Supreme Court rejected a challenge on the basis that the arbitral tribunal's refusal to appoint a tribunal expert was not a violation of the applicant's right to be heard. With respect to the annulment proceedings and grounds for annulment, this decision seems to express limitations to the formal nature of the right to be heard in adversarial proceedings, at least in respect of the right to adduce evidence.
Smart contracts are a hot topic in almost every industry sector. There is a misconception that, because they perform automatically and their performance cannot be stopped, they remove the potential for disputes. At least for the moment, this is wishful thinking. Although smart contracts provide huge potential benefits in terms of reducing transaction costs and increasing security, disputes can and will arise.
As with any other contract, general rules of interpretation are crucial to ascertain the scope and reach of arbitration agreements. The Supreme Court recently missed the chance to provide a sharper and more sophisticated decision concerning the applicable legal rules of interpretation of arbitration agreements, which is a crucial matter for the uniform enforcement of international commercial arbitration agreements.
The Limassol District Court recently concluded that an appeal pending before the English courts does not suspend an order's enforcement or diminish the validity of an arbitral award. The applicants had applied for the recognition and enforcement of an arbitral award issued in May 2016. The court held that the order was final and that there had been no abuse of process; the respondents' request to set aside the award was therefore rejected.
In a recently published decision, the Supreme Court held that an arbitration clause contained a valid waiver of challenge against the award. The court also held that such a waiver extended to the applicant's subsidiary request for revision. When interpreting arbitration clauses to determine whether they contain such a waiver, the term 'appeal' should be understood as referring to the remedy that parties have against an award in Switzerland, namely the challenge proceedings.
The recently approved labour reform allows arbitration in individual employment agreements, provided that the employee's monthly salary is twice as high as the cap on social security pensions and the arbitration clause is proposed or expressly agreed by the employee, according to the Arbitration Law. This means that employees with a higher level of education and income can now sign employment contracts for the settlement of any disputes through arbitration.
The Supreme Court of Newfoundland and Labrador recently dismissed an application by the province under Sections 14 and 34(2)(a)(iii) of the Arbitration Act. The court held that the parties had legally contracted out of the act, narrowing the circumstances in which a court could set aside an arbitral award. The decision furthers the general theme of recent Canadian jurisprudence, which has emphasised party autonomy and deference to reasonable arbitral decisions.
Arbitration funding is becoming increasingly more prevalent in England and Wales. Funders are legally sophisticated and understand a wide breadth of claim types, with each funder having a varying risk profile and appetite. Recent product developments include funders seeking to identify and fund bundles or portfolios of claims. Other innovations include pre-funding to allow claimants to determine the merits of an action and providing funding for general working capital.
As the number of electronic devices, applications and other technologies increases, there has been a corresponding growth in the volume of potentially disclosable data in a dispute. While parties' disclosure obligations are clearly defined in the context of litigation, international arbitration offers a more flexible approach to disclosure which will often be influenced by the legal jurisprudence of the tribunal.
The Svea Court of Appeal recently rejected City Säkerhet's motion to set aside an arbitral award. The judgment clarifies whether an arbitrator's application of a legal rule to which neither party referred in the arbitration may constitute grounds to challenge the arbitration award. The principle of jura novit curia (ie, the court knows the law), which is applicable in court proceedings, should also apply in Swedish arbitration unless otherwise agreed by the parties.
In time, Big Data will lead to the automation of most human tasks. The change potential for all organisations (and for society at large) is enormous, and it is already happening in an arbitration context. Some will consider that human discretion will always be a necessary part of dispute resolution. However, if arbitration exists to serve the interests of businesspeople – and if technology can offer quicker, cheaper, data-driven solutions that reduce the margin for error – human arbitrators could become irrelevant.
In both domestic and international arbitrations in Turkey, parties are, in principle, free to choose their arbitrators. However, there are limits in this regard, including where the parties are of different nationalities. The Court of Appeals recently rendered an important decision in this regard, which provides an objective standard of proof for assessing doubts with regard to the independence and impartiality of arbitrators.
The Court of Appeal recently held that the Tax Appeal Tribunal has jurisdiction to adjudicate tax-related disputes. The appellants in the case successfully argued that the tribunal's jurisdiction to determine tax disputes does not encroach on the exclusive jurisdiction of the Federal High Court, as bringing tax appeals before the tribunal is merely a condition precedent to approaching the court. Further, the tribunal's decisions can be reviewed and quashed by the court.
The Supreme Court recently set out the legal position regarding challenges to a person's possible appointment as an arbitrator. It held that since ineligibility goes to the root of the appointment, the Arbitration and Conciliation Act 1996 clarifies that if the arbitrator falls under any of the categories specified in the Seventh Schedule, he or she becomes ineligible to act as an arbitrator. However, if the circumstances fall under the Fifth Schedule, the person would not be de jure ineligible.
The Federal Court recently declined an application for leave to issue subpoenas pursuant to Section 23 of the International Arbitration Act 1974 on the basis that Section 23 of the act did not give the court jurisdiction to do so in aid of an arbitration seated outside Australia. While some practitioners will agree with the court's strict interpretation of the act, others – particularly those engaged in international arbitration in Asia-Pacific – may find the decision less satisfactory.
There are known difficulties with litigating IP and technology disputes, particularly where the disputes are global and involve rights protected in different jurisdictions. A recent international survey of IT and telecoms suppliers found that although respondents identified arbitration as their preferred mechanism of dispute resolution, in practice the most common mechanism over the past five years was litigation.
On its road to recovery, Iraq has witnessed an avid influx of foreign investment in its economy. With the ongoing developments in Iraq's legal infrastructure, it is anticipated that further regulations concerning international dispute resolution and judicial cooperation will be enacted in order to create a legal environment suitable for the country's attractive investment opportunities.
Hong Kong's Financial Dispute Resolution Scheme will be expanded with effect from January 1 2018 and July 1 2018 by amending the jurisdiction and terms of reference of the Financial Dispute Resolution Centre. Alongside the recent changes to allow third-party funding in arbitration, the changes to the scheme show that alternative dispute resolution is coming of age for financial disputes in Hong Kong where there is an imbalance of power between parties.
The full bench of the Superior Court of Justice recently refused the recognition and enforcement of two arbitral awards issued by an arbitral tribunal seated in New York under the International Chamber of Commerce Rules. This decision is historic and important for arbitration, as it is one of the rare cases in which the Superior Court of Justice failed to recognise a foreign arbitral award.