CIArb News

London Branch Seminar: Have Emergency Arbitrators come of age?

17 Jun 2019

L-R: Nick Storrs, Signature Litigation LLP; Christopher Newmark, Spenser Underhill Newmark LLP; Paul Rose, Chair, London Branch; Ben Giaretta, Mischcon de Reya LLP; Tim Hardy, convenor, CMS Cameron McKenna Nabarro Olswang LLP.  

10 years after the introduction of emergency arbitrators, an expert panel considers the results.

On 12 June 2019, London Branch held its seminar on the topic 'Have Emergency Arbitrators come of age?'

Paul Rose, Chair of the London Branch, thanked convenor Tim Hardy and host CMS Cameron McKenna Nabarro Olswang LLP.  He welcomed attendees including CIArb President Thomas D. Halket, visiting from New York, and Jonathan Wood, chairman of the CIArb Board of Trustees.

Christopher Newmark was the first emergency arbitrator appointed by the International Chamber of Commerce (ICC), and was involved in drafting the ICC Rules on emergency arbitrators.  He explained that previously, emergency relief prior to an arbitration commencing, such as preservation of assets or security, was typically sought from the High Court in London.  Parties adopting the ICC Rules must opt out of the emergency arbitrator provisions if they do not want them to apply, so that they are the default position.  In 2015, the ICC’s Commission on Arbitration and ADR, which Christopher chaired, established a task force to provide guidelines on emergency arbitration.  During that process, it became apparent that applicants were experiencing a relatively low success rate, which suggested that emergency arbitrators were cautious in agreeing to order relief.  He concluded that this may discourage applicants, who may then only use the procedure when the courts are not a viable alternative for emergency relief.          

Ben Giaretta has been appointed as arbitrator in a number of emergency arbitrations in Singapore.  Ben reflected that emergency arbitrations by their nature are messy and present practical difficulties to overcome.  There is an imbalance between the parties in that the respondent may have little time to deal with a large amount of material provided by the applicant, although he noted that if the applicant has been able to prepare extensively, that suggests there is no emergency and the tribunal instead should decide. Typically, emergency arbitration orders are produced after days, rather than weeks, so it is very intensive for all involved.  Due process is difficult to manage as email rather than post will be used, and new issues and evidence are bound to appear during the proceedings.  

Nick Storrs is a solicitor advocate acting in complex international arbitrations. He acted in the 2016 case of Gerald Metals SA v Timis & Ors, which held that where the London Court of International Arbitration (LCIA) emergency arbitrator rules applied, the court’s jurisdiction to provide relief under s44 of the Arbitration Act 1996 could only be invoked in an extreme emergency. The court will only intervene if there is no time for an emergency arbitrator to be appointed.  Nick considered that given there is less doubt over the enforceability of a court order than an order of an emergency arbitrator, a strong enforcement mechanism has been lost. Parties may be more likely now to look beyond London to courts in other jurisdictions for emergency relief.  As regards the wider international impact of this decision, the case involved the Arbitration Act 1996 and the LCIA Rules, but the impact may spread further.

There followed an extensive Q&A Session, where it was noted that should the parties wish to opt out of emergency arbitrator rules by agreement, they are free to do so.   CIArb President Thomas D. Halket addressed the meeting, and a drinks reception was kindly provided by hosts Cameron McKenna Nabarro Olswang LLP.

The write-up was prepared by Abigail Day MCIArb.

 

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