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ADR and Diversity

Business Conflict Blog - Sun, 2018-01-14 15:07

Last year, New York Law School and the ABA Business Law Section convened all three of the CEOs of the national ADR organizations, plus other leaders, to address persistent issues of lack of diversity in the mediation and arbitration profession.  This year, on the afternoon of January 17, 2018, the same event will take place, featuring the past president and the current House of Delegate Chair of the ABA; the Chair of the ABA Dispute Resolution Section; Tom Stipanowich of Pepperdine; Judge Elizabeth Stong of EDNY; Jim Tricarico of Edward Jones; Bill Johnston of the ABA Business Law Section; and experienced facilitators from the leading ADR organizations and court programs around the New York region.

If you are in the New York area on Wednesday afternoon January 17, you should come by.  Three CLE credits, including one hour of the new required category, “Diversity, Inclusion and Elimination of Bias.”  Registration is available here.

Let’s Stop Talking About the Arbitrator Diversity Problem

Kluwer Arbitration Blog - Sun, 2018-01-14 01:56

Gary L. Benton

Wouldn’t it be fantastic if 2018 was the year we stopped talking about the problem of diversity in international arbitration? That is, what if we solved the problem today – and no longer needed to discuss it? We can. Today – by recognizing it’s not the problem. I propose a new standard for addressing the issue.

Let’s first put the so-called problem in proper perspective. Much has been said and written about the lack of arbitrator diversity in international arbitral panels and how it is either unjust, unfortunate or detrimental to the process. For years, the group Arbitral Women has, commendably, been raising awareness of the problem. Other groups have rallied to the cause. Leading institutions have responded, nearly across the board, pledging to include women and diverse practitioners in their panels, lists and appointments. Corporate counsel from an array of leading companies and others signed the Equal Representation in Arbitration Pledge committing to take action. ITA-ASIL, ICCA and other leading arbitral organizations are devoting conferences and conference sessions to the topic.

Yet, despite the growing awareness of the issue, many active voices on the issue, and some recent gains, appointments of women to tribunals of leading arbitral institutions hoover around 20% and diverse practitioners are similarly under-appointed. We widely recognize there is something wrong but we haven’t effected a solution.

Embracing the Norm

Professor Catherine Rogers has named this predicament the Arbitrator Diversity Paradox. In a Kluwer Arbitration Blog post at the end of 2017, Professor Rogers articulated the paradox that public consensus increasingly reflects a pervasive concern about the lack of diversity among international practitioners but there is an apparent failure to translate the concern into appointments for women and other diverse practitioners. Professor Rogers argues that the key to unlocking the paradox is better intelligence on arbitrators. Of course, Professor Rogers is right; more information is needed to identify qualified arbitrators and implement change.

More fundamentally, the paradox is resolved by refocusing our view on what is normal. A panel that is diverse should be recognized and embraced as the norm. A panel that is not diverse should be identified as deficient, abnormal and unacceptable.

Think about it, what’s normal and what’s not? What’s not normal are panels that don’t include women or diverse practitioners. It’s topsy-turvy to call a panel composed solely of white males normal when women and minorities constitute the majority of our population. A panel that does not include a woman or diverse practitioner neither represents the majority nor has the benefit of diverse perspectives. It is, in essence, incomplete and defective.

So, while I applaud the many fine initiatives to raise awareness regarding the qualifications of women and diverse practitioners, I suggest it’s time to extend our focus to the fact that there is something fundamentally perverse about consistently appointing panels composed solely of white males. A monotony of panel members does not make a panel better. It denies healthy deliberations and skews the norm.

Once we reconsider what is and what isn’t normal, we’re properly positioned to implement a standard that addresses the situation.

But let me pause and ask: Is it wrong to set a new normal? The answer is absolutely not – because we already recognize there is something wrong with our current perspective. Despite the growing visibility of women and diverse practitioners in the field, appointments are lacking. The 2016 Berwin Leighton Paisner (BLP) survey on diversity in arbitrator panels found that 80% of respondents believe tribunals are not properly constituted on diversity grounds. Apparently, there is significant demand for a new normal.

Setting the Standard

The standard should address the norm. Here is the standard I propose:

All panels should include at least one woman or other diverse practitioner and panels that do not are “Defective Panels.”

Yes, just as poorly drafted arbitration clauses can be pathologically defective so too should we consider panels that aren’t constituted to benefit from the perspectives and contributions of women and diverse practitioners to be pathological and abnormal.

I am not suggesting that a Defective Panel cannot proceed and resolve a case. It has been done, all too regularly, all too often. Rather, I am suggesting that we recognize that a panel so narrowly constituted is neither healthy nor normal. It can possibly do the task but it is not the ideal means. Such panels should be discouraged.

How do we apply the standard? As follows:

1. Parties/Counsel: Parties and counsel are to be informed that the standard for a properly constituted panel in international arbitration is to include at least one woman or diverse practitioner. If neither of the parties selects a woman or diverse practitioner as their appointee, the appointed Chair should be a woman or diverse practitioner. We call a panel that is not properly constituted a “Defective Panel.”

2. Institutions: Institutions should promote the standard and their compliance with it to parties, counsel and arbitrators. Institutions should follow the standard and make institutional appointments to ensure that at least one woman or diverse practitioner is on every panel. Institutions should acknowledge that a panel not properly constituted is a “Defective Panel.”

3. Arbitrators: Arbitrators should support the standard and make Chair appointments to ensure that at least one woman or diverse practitioner is on every panel. Where a woman or diverse practitioner is already appointed by a party to a panel, the wing arbitrators should consider whether there are other qualified women or diverse practitioners to serve as Chair. Arbitrators should acknowledge that a panel that does not include at least one woman or diverse practitioner is a “Defective Panel.”

Objections to the Standard

Being lawyers, our first instinct is to look to flaws. For the sake of the profession, the practice and your own dignity, I suggest you resist the urge here. Rather, allow me to address several potential critiques for you.

Is just calling a Defective Panel “defective” going to solve the problem? No, of course not. Recognizing that a panel is defective merely raises awareness. But implementing the standard in appointments will solve the problem.

Are there enough qualified women and diverse practitioners to serve? Yes, the reality is that there are hundreds of qualified women and diverse practitioners available for every case. Beyond sitting arbitrators, there are many young and diverse qualified arbitration counsel who can serve ably as a third arbitrator on a panel.

But what if I need an Arbitrator with expertise in a particular subject area? Most of the shining stars in our profession are generalists. Not every panel member needs to be a specialist. Moreover, the suggestion that there are no qualified women or diverse practitioners with subject matter expertise to sit on most cases is an absurdity. Look a little harder. Cases where a Defective Panel is required should be the exception not the rule.

Should we wait until we have more data on candidates to implement the standard? There are capable candidates now. There is no doubt that arbitral institutions, initiatives like Arbitrator Intelligence and organizations like Arbitral Women will continue to identify and profile qualified candidates. Implementing the standard will accelerate those intelligence-gathering efforts.

Is the standard a quota? Is it a reverse quota? No, the standard does not set any limit on the number of women or diverse practitioners who may serve on a panel. Nor does it set a limit on the number of men or non-diverse practitioners. Rather, it simply acknowledges that there is something inherently wrong if a panel is not diverse.

Should the standard be higher? It could be but the standard attempts to recognize the norm. Perhaps the standard will evolve over time but, at present, there is broad agreement that there is something wrong with a panel that lacks any diversity.

I’m an older, white male so what’s in it for me? If your self-interest outweighs your willingness to accept that diversity improves the process, consider that most users will welcome the standard and it may improve user acceptance of arbitration, use of arbitration and, accordingly, your number of appointments. If nothing else, diverse panels can add some spice to your life.

Going Forward

Most of the panels I sit on today are Defective Panels. Ideally, we should all have the courage to admit that we’ve sat on or contributed to the constitution of Defective Panels. More importantly, now is the time for all of us to move beyond the past and encourage parties, arbitral institutions and our fellow counsel and arbitrators to resist constituting Defective Panels in the future.

Redfern, Kaplan, Reed, Born and others have brought great innovation to international arbitration. What I propose is, however, much more modest. There is nothing revolutionary in recognizing monotony is not the norm. Let us simply acknowledge what is appropriate in panel appointments – and let us call out Defective Panels when we see them. Recognizing diverse panels as the norm is an accomplishment that can be attributed to us all.

By embracing the standard, we can stop talking about problem of arbitrator diversity and implement the solution.

More from our authors: International Arbitration and the Rule of Law
by Andrea Menaker
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The post Let’s Stop Talking About the Arbitrator Diversity Problem appeared first on Kluwer Arbitration Blog.

Women and the Law Conference Announcement

ADR Prof Blog - Sat, 2018-01-13 14:52
I am happy to announce that Professor Ellen Waldman and her colleague Susan Bisom-Rapp , along with a terrific organizing committee, are co-organizing a conference at Thomas Jefferson School of Law, which will be held on Friday, February 9th. The 18th Annual Women and the Law Conference is titled “Her Place at the Bargaining Table: … Continue reading Women and the Law Conference Announcement →

Designing an Effective Arbitration Clause - Lexology

Google International ADR News - Sat, 2018-01-13 12:33

Designing an Effective Arbitration Clause
In many jurisdictions, it is permissible to structure your arbitration clause to allow one party to unilaterally elect arbitration, as opposed to litigation or some alternative dispute resolution process, after the dispute has arisen. By reserving the ...

Arbitrator Intelligence (AI) is seeking a Social Media Manager

Kluwer Arbitration Blog - Sat, 2018-01-13 00:33

Catherine A. Rogers

Duties will include: generating, editing and publishing content, and designing a social media strategy to coordinate communication and outreach. This position requires effectiveness in writing/editing, and a combination of practical skills, legal training, and knowledge of the international arbitration field globally. Candidates should ideally have proficiency in search engine optimization (SEO), Google analytics, and social media outlets such as Twitter, LinkedIn, Instagram, and Pinterest.

The Social Media Manager will work remotely, in coordination with AI Founder Catherine Rogers, and will be expected to commit on average a few hours per week. The position is compensated by an annual honorarium of US$3000. If you are interested, please submit a resume and cover letter by email to [email protected]. The deadline for receiving applications is 31 January 2018.

More from our authors: International Arbitration and the Rule of Law
by Andrea Menaker
€ 240

The post Arbitrator Intelligence (AI) is seeking a Social Media Manager appeared first on Kluwer Arbitration Blog.

'Nigeria needs more biz schools' - Daily Trust

Google International ADR News - Fri, 2018-01-12 22:35

Daily Trust

'Nigeria needs more biz schools'
Daily Trust
Emmanuel Business School has taken a giant step with its highly qualified faculty, world class facilities, international certifications and affiliations with some world leading universities. EBS is therefore a business school that operates on ...

ABA Section of Dispute Resolution Young Scholar Program

ADR Prof Blog - Fri, 2018-01-12 11:22
I am passing along an announcement from the ABA Section of Dispute Resolution regarding its inaugural Young Scholar Program, which will sponsor young professionals interested in ADR who want to attend the Section’s April 2018 annual spring conference, this year in Washington DC.  According to the Section’s Director, the Section will “invite him/her to serve … Continue reading ABA Section of Dispute Resolution Young Scholar Program →

Mediation – the postgraduate course that's never been more vital - The Guardian

Google International ADR News - Fri, 2018-01-12 10:58

The Guardian

Mediation – the postgraduate course that's never been more vital
The Guardian
These are very transferable skills, says Joanne Atkinson, who runs the LLM alternative dispute resolution course at the University of Portsmouth. “There are many opportunities in this marketplace – for people with a background in law, but also those ...

Settlement Week in the Western District of New York

ADR Prof Blog - Fri, 2018-01-12 10:26
The US District Court for the Western District of New York  pulled settlement week out of the dustbin to help clear some its back log in November 2017.  For those who aren’t familiar with settlement week, a court designates a week to bring civil litigants and mediators to the courthouse in an attempt to resolve … Continue reading Settlement Week in the Western District of New York →

Problems of Ad Hoc Arbitration in Armenia

Kluwer Arbitration Blog - Fri, 2018-01-12 02:51

Aram Khachatryan

Ad hoc arbitration in Armenia entails several legal issues.

The first issue discussed here is related to the concept of “place of arbitration”. The problem is generated out of a very specific wording of the Armenian Arbitration Act.

From the perspective of international arbitration, Armenia is classified as a Model Law country, as it adopted an arbitration act based on the UNCITRAL Model Law (version 1985) in 2006.
The initial version of the Armenian Arbitration Act contained a provision in article 6 specifying that a single judicial institution, which was the Court of common jurisdiction of Kentron and Nork-Marash communities of Yerevan, is an authority competent to perform all the functions of court assistance to arbitral tribunals and supervision of their decisions.

However, on June 19, 2015, a package of revisions of the Armenian Arbitration Act adopted by the Armenian Parliament revised, inter alia, the above-mentioned article 6. The revision stated that the functions referred to in articles 9 on interim measures, article 11(3) and (4) on the appointment of arbitrators, article 13(3) on the challenge procedure, article 14 on failure or impossibility to act, and article 27 on court assistance in taking evidence shall be performed by the court of the place of arbitration (emphasis added).

Meanwhile, the rest of the functions (such as those stated in articles 34 (2) on setting aside, 35 -36(2) on recognition and enforcement of arbitral awards) were left to be decided by the Court of common jurisdiction of Kentron and Nork-Marash districts of Yerevan.

The new wording of article 6, however, turned to be problematic in the practice.
Let’s imagine a hypothetical arbitration clause as follows:

“All disputes arising out or in connection with this agreement will be resolved by arbitration according to the UNCITRAL 2010 Arbitration Rules, and the place of the arbitration will be Yerevan, Armenia.”

The problem we may face is the one of determining the exact court which would have jurisdiction to perform functions referred to in articles 9 / interim measures /; 11(3), 11(4) / the appointment of arbitrators /, 13(3) / the challenge procedure /, 14 / failure or impossibility to act/, 27 / court assistance in taking evidence/ of the Armenian Arbitration Act.

The fact is that in Yerevan, the capital of Armenia, there are seven courts of general jurisdiction covering twelve administrative districts of the city. In this situation, when a party in ad hoc arbitration submits an application, e.g., for a preliminary injunction at a stage when an arbitral tribunal has not yet convened, the court, based on article 6(1) of the Armenian Arbitration Act, would refuse to proceed with the application, additionally requesting the determination of the address of arbitration in order to establish its jurisdiction.

A practical and/or contractual solution could be fixing an address of the place of arbitration in advance in the arbitration agreement, e.g., “place of arbitration Yerevan /Armenia/ street xx building xx, apartment xx” or “place of arbitration Yerevan /Armenia/ the address of respondent or claimant”.

Another more effective solution here could be a “legislative intervention” (the revision of the Armenian Arbitration Act) – which shall provide for a backup provision stating for the jurisdiction of a respondent’s domicile Court, unless otherwise agreed by the parties.

Hopefully, this situation will be solved by the legislative soon. However, for now, it would be better for practitioners to be aware of this “legislative trap” and use some contractual solution for it.

The second issue is related to interim measures (preliminary injunctions) granted by a court, before the tribunal in ad hoc arbitration is convened. Both the Civil Procedure Code (article 97 (1)) and the Armenian Arbitration Act (article 17.7 (1)) regulate granting interim measures by national courts in the course of arbitration, i.e. when arbitral tribunals are already formed. In other words, according to the mentioned legal acts, the court may grant an interim measure only in case when there is a pending arbitration.

Hence, Armenian courts request from a party who applies for an injunctive relief an evidence certifying that at least arbitrators or an arbitrator is appointed. The argumentation of the court here is that there is no pending ad hoc arbitration, unless the tribunal has been convened.

One may argue that the above described approach is a “way out” for the Armenian courts, which are unexperienced in commercial arbitration.

However, this approach makes the granting of interim measures in ad hoc arbitration before the appointment of arbitrator(s) practically impossible under the Armenian Arbitration Act, and thus, endangering the perspectives of fostering arbitration as a dispute resolution model in Armenia.

The solution here can be a legislative amendment which would expressly provide for the court’s power and obligation to process the application for interim measures even in cases when an arbitral tribunal is not convened in ad hoc settings.

The third issue is related to the appointment of the arbitrators by a national court if the parties in ad hoc arbitration have not reached an agreement.

The main article regulating this procedure is the article 11.3(1) of the Armenian Arbitration Act, which is a verbatim adoption of the provision on the matter of the Model Law, and which states that failing an agreement on a procedure of appointing the arbitrator or arbitrators in an arbitration with three arbitrators, each party shall appoint one arbitrator, and the two arbitrators thus appointed shall appoint the third arbitrator. Furthermore, if a party fails to appoint the arbitrator within thirty days as of the receipt of a request to do so from the other party, or if the two arbitrators fail to agree on the third arbitrator within thirty days as of their appointment, the appointment shall be made, upon request of a party, by the court or other authority specified in article 6.

The problem here is that this provision is not further elaborated in the Civil Procedure Code, and the courts’ obligation to process the request on appointment of arbitrator is not ascertained in any way.

Thus, in the practice this essential step in arbitration procedure may be processed in diverse ways by local courts – one may arrange a court hearing, the other may request some additional information, the third one may react to this application only after 15 days or more. Apparently, all these situations are contrary to the very substance of arbitration and the required court assistance.
For this issue, again, the best solution would be an amendment to the Civil Procedure Code which would expressly regulate the processing of the applications for the appointment of arbitrators by courts. The amendment shall at least stipulate the exact content /minimum requirements/ for such applications, as well set the time limits for processing them.

The “ad hoc arbitration, place of arbitration Yerevan (Armenia)” is a dispute resolution model, that, although having basic legal foundations stated in Armenian Arbitration act, may, still, face several practical problems as describe above. Thus, legal practitioners agreeing on “ad hoc arbitration, place of arbitration Yerevan (Armenia)”, need to have additional, up-front regulations, such as stating some address of place of arbitration and the appointment of arbitrators. to cover the situations that my hinder effectiveness of this dispute resolution mechanism.

More from our authors: International Arbitration and the Rule of Law
by Andrea Menaker
€ 240

The post Problems of Ad Hoc Arbitration in Armenia appeared first on Kluwer Arbitration Blog.

2019: INEC Rules Out Constituency Delineation - Leadership Newspapers

Google International ADR News - Thu, 2018-01-11 21:41

Leadership Newspapers

2019: INEC Rules Out Constituency Delineation
Leadership Newspapers
Where misunderstandings occur, use your Alternative Dispute Resolution (ADR) mechanism to resolve them. Alternatively, you can avail yourselves of the commission's robust dispute resolution mechanism. “Conflicts within political parties affect the ...

and more »

Professionalising arbitration - The Hindu

Google International ADR News - Thu, 2018-01-11 11:53

The Hindu

Professionalising arbitration
The Hindu
The huge backlog in courts is another reason for the government to consider instituting other modes of dispute resolution. Besides, the International Centre for Alternative Dispute Resolution (ICADR), which was set up in 1995 with government funds to ...

INEC Rejects 61 Association Seeking Registration As Political Parties - Leadership Newspapers

Google International ADR News - Thu, 2018-01-11 11:25

Leadership Newspapers

INEC Rejects 61 Association Seeking Registration As Political Parties
Leadership Newspapers
“Where misunderstandings occur, use your Alternative Dispute Resolution (ADR) mechanism to resolve them. Alternatively, you can avail yourselves of the commission's robust dispute resolution mechanism,” the INEC chairman said adding that conflicts ...

and more »

The UNCITRAL Technical Notes on Online Dispute Resolution – Paper Tiger or Game Changer?

Kluwer Arbitration Blog - Wed, 2018-01-10 17:09

Nadine Lederer

Young ICCA

Is the future of dispute settlement online? There may not be a more relevant topic for the future of dispute resolution, including arbitration, than Online Dispute Resolution (“ODR”), so it was concluded at the 17th ODR Conference organized by the ICC International Court of Arbitration in Paris in June 2017 (see here, also reported on Kluwer Arbitration Blog here and here).

The United Nations Commission on International Trade Law (“UNCITRAL”) recognized the potential of ODR already a few years ago. In 2010, at its 43rd session, it decided to undertake work in this specific legal field. This led to the establishment of Working Group III on ODR (“Working Group”) which developed the recently adopted Technical Notes on Online Dispute Resolution (“Technical Notes”).

There is no universal definition and understanding of ODR. However, for the purposes of the Technical Notes, para. 24 defines ODR as a “mechanism for resolving disputes through the use of electronic communications and other information and communication technology”. The Technical Notes further clarify that “ODR encompasses a broad range of approaches and forms (including but not limited to ombudsmen, complaints boards, negotiation, conciliation, mediation, facilitated settlement, arbitration and others)” (para. 2).

Background and Initial Mandate of the Working Group

UNCITRAL tasked the Working Group with developing a global ODR system for cross-border e-commerce disputes since traditional judicial mechanisms may not offer an adequate solution for resolving these disputes, the number of which is increasing and where the amount in controversy is often quite small. Therefore, UNCITRAL regarded the development of tailored procedures which do not create costs, delays and burdens disproportionate to the economic value at stake as critical (UN Doc A/CN.9/706, para. 50).

The Working Group was given the task to develop a practical avenue for a simple, quick and inexpensive resolution of e-commerce disputes, however, it was not to prepare a new set of arbitration rules (UN Doc A/CN.9/721, para. 17). Its mandate included drafting a generic set of procedural rules which were intended to apply to both business-to-consumer and business-to-business online transactions (UN Doc A/CN.9/WG.III/WP.105, para. 2; all documents of the Working Group are available here). Additionally, guidelines and minimum standards for ODR providers and for neutrals that assist the parties in settling or resolving a dispute (e.g. a mediator or arbitrator), substantive legal principles for resolving disputes and a cross-border enforcement mechanism should be developed (UN Doc A/CN.9/WG.III/WP.112, para. 3). The procedural rules were meant to be of a contractual nature and to apply by agreement of the parties to the extent that there was no conflict with mandatory provisions of domestic law (UN Doc A/CN.9/744, para. 16).

The Working Group envisaged a three-tiered ODR procedure, which would start with negotiations between the parties and, if unsuccessful, it would be followed by facilitated settlement proceedings involving a third-party neutral who would mediate between the parties in order to reach a settlement. The final stage would entail arbitration. The Working Group, however, faced difficulties in agreeing on the nature of the final phase. In particular, disagreement arose on the question whether it were to be binding on the parties, the reason for it being that the legal validity of pre-dispute consumer arbitration agreements is treated differently in the various jurisdictions. The European Union, for example, restricts in Directive 93/13/EEC on unfair terms in consumer contracts and in Directive 2013/11/EU on alternative dispute resolution for consumer disputes the validity of such agreements. In order to deal with this issue, the Working Group considered developing two different tracks, one ending in a binding arbitration phase (Track I) and the other one concluding with a non-binding recommendation by the neutral (Track II). However, in the end, no consensus on this issue could be reached.

The UNCITRAL Technical Notes on ODR

As a consequence of the lack of progress in developing a set of procedural rules, UNCITRAL eventually redefined the mandate of the Working Group. On this basis, it had to develop “a non-binding descriptive document reflecting elements of an ODR process, on which elements the Working Group had previously reached consensus, excluding the question of the nature of the final stage of the ODR process (arbitration/non-arbitration)” (UN Doc A/70/17, para. 352). The Technical Notes, which UNCITRAL adopted at its 49th session in 2016, were born as a result of the redefined mandate.

The Technical Notes are a descriptive document of a non-binding nature and are neither exhaustive nor exclusive (see para. 6). They are “intended for use in disputes arising from cross-border low-value sales or service contracts concluded using electronic communications” (para. 5) and to promote the development of ODR by providing assistance to ODR administrators and platforms as well as to neutrals and the parties to ODR proceedings (see para. 3). Parties can organize their ODR proceedings in accordance with the Technical Notes and have to agree on the exact details and elements of the proceedings in this respect. Moreover, ODR providers may use the Technical Notes as guidance to set up their rules of procedure.

The main elements of an ODR process are reflected in Sections III, VII, VIII and IX. The Technical Notes assume that the whole procedure will be conducted exclusively online through a platform. They foresee several stages: The first two stages were adopted from the draft procedural rules on which the Working Group had already reached consensus, that is technology-enabled negotiation as a first stage (see paras. 37-39), which is followed by a facilitated settlement phase involving a third-party neutral (e.g. a mediator/conciliator) (see paras. 40-44). The final stage only comes into play should the parties not have reached settlement during the first two phases. In such instances, it is desirable that “the ODR administrator or neutral informs the parties of the nature of the final stage, and of the form that it might take” (para. 45). This provision thus leaves the nature of the final stage open, thereby providing for maximum flexibility. It could, for example, consist of binding arbitration proceedings or end with a non-binding recommendation by the neutral, depending on what the parties have agreed.

The Technical Notes also include provisions about the principles which should apply in ODR proceedings (see Section II). They consider approaches to ODR systems that represent principles of independence, impartiality, effectiveness, efficiency, due process, fairness, transparency and accountability (paras. 4 and 7 et seq.). Ideally, ODR proceedings should be subject to the same due process and confidentiality standards that generally apply in offline dispute resolution proceedings (see para. 53).

Furthermore, the Technical Notes deal with the appointment and role of neutrals (see Section X), the language of the proceedings (see Section XI) and governance (see Section XII).


Having invested six years of work, UNCITRAL could not realize its initial ambitious goal of developing an international set of procedural rules including guidelines and minimum standards for ODR platforms/administrators and for neutrals as well as substantive legal principles for resolving disputes and a cross-border enforcement mechanism. Instead, the adopted Technical Notes lay down in a rather general and vague manner the basic concepts and elements of ODR proceedings. Given their non-binding and descriptive nature, it remains to be seen to what extent the Technical Notes will be of any practical relevance.

Even though they fall short of the envisaged creation of a global ODR system, the Technical Notes are a welcome step in the right direction since they offer the opportunity to further promote and build on ODR. While ODR is not a new phenomenon, it remained an unrealized, theoretical concept with high, but untapped potential until now. Besides the European legal framework, i.e. the Regulation (EU) No 524/2013 on online dispute resolution for consumer disputes and the Directive 2013/11/EU on alternative dispute resolution for consumer disputes, the Technical Notes now present another valuable legal instrument of an international organization specifically dealing with ODR. In particular, the Technical Notes highlight its benefits, i.e. that ODR offers a simple, flexible, fast and inexpensive mechanism to resolve disputes that arise out of e-commerce transactions. They may serve as useful guidance for States, ODR platform providers and administrators, neutrals as well as disputing parties on how to effectively organize such proceedings.

The regulatory initiatives of UNCITRAL, the European Union as well as the Council of Europe which has encouraged its Members to further develop and promote ODR mechanisms (see Doc. 13918, para. 5) and is currently preparing a technical study on the development of ODR mechanisms (see here), prove that increased attention has been given to ODR more recently. Albeit gradually, it is becoming an important alternative to traditional offline alternative dispute resolution and court litigation for certain kinds of disputes, in particular those arising out of cross-border e-commerce transactions.

More from our authors: International Arbitration and the Rule of Law
by Andrea Menaker
€ 240

The post The UNCITRAL Technical Notes on Online Dispute Resolution – Paper Tiger or Game Changer? appeared first on Kluwer Arbitration Blog.

The scope of MiFID II and GDPR - Lexology

Google International ADR News - Wed, 2018-01-10 08:47

The scope of MiFID II and GDPR
This will be significant in the event that such data has to be provided to a competent authority (such as the FCA) and, where applicable under national law, to an alternative dispute resolution entity. These requirements are supplemented by the general ...

and more »

Opioid Litigation & Judicial Role in Settlement

ADR Prof Blog - Wed, 2018-01-10 08:19
Great article this morning from the National Law Journal, with someone misleading title: “Judge Orders Opioid Lawyers to Come Up With a Settlement Plan.” Available here and text excerpt below. As one who grew up, clerked in northern Ohio, and still names as “hometown” one of the (many) places hard hit by this crisis, I am … Continue reading Opioid Litigation & Judicial Role in Settlement →

Anticipatory Renunciation to Challenge Arbitral Awards Under Swiss Law – An Update

Kluwer Arbitration Blog - Wed, 2018-01-10 01:01

Léonard Stoyanov and Nadia Smahi

On 17 October 2017, the Swiss Federal Tribunal (Switzerland’s highest jurisdiction) rendered a decision (4A_53/2017) on the challenge of an award rendered in the context of an international arbitration where the arbitration clauses of the disputed contracts both contained a wording whereby the parties renounced challenging any possible future arbitral award.

I. Relevant Facts

In 2003, a State which until then had been the sole shareholder of a company (the “Company”) let the main gas company of another State take a stake (apparently minor) in the Company.
This led to the conclusion of a shareholders’ agreement.

In 2008, the gas company became the majority shareholder of the Company.

In 2009, the shareholders entered into a “GAS Master Agreement” and amended their shareholders’ agreement, thereby granting the gas company exclusive managing powers on the Company.

Both agreements contained the same dispute resolution clause, which reads as follows:

“[a]wards rendered in any arbitration hereunder shall be final and conclusive and judgment thereon may be entered into any court having jurisdiction for enforcement thereof. There shall be no appeal to any court from awards rendered hereunder”.

In 2014, the State initiated arbitration proceedings under the UNCITRAL Rules against the gas company claiming that the conclusion of the “GAS Master Agreement” and amended shareholders’ agreement was tainted with corruption. The arbitral tribunal comprised three members, including a well-renowned Professor designated by the State.

On 23 December 2016, the arbitral tribunal decided against the State.

On 1 February 2017, the State challenged the award before the Federal Tribunal by means mainly of a civil recourse (“recours en matière civile”) and in the alternative, of a request for revision (“demande de révision”). The former is the ordinary means of challenge of international arbitration awards mentioned in article 191 of the Swiss Private International Law Act (“SPILA”). The latter is an extraordinary means which is currently not referred to in the SPILA (see however first author’s article of 18 May 2017 on this blog) but which the Federal Tribunal has reckoned admissible in the context of international arbitration.

The grounds on which the civil recourse and request for revision were based were that the State had learnt in January 2017 that the arbitrator it had appointed had already acted in such capacity in an arbitration where he had been appointed (in 2013) by a company controlled by the defendant. This fact, which the arbitrator had not disclosed in the frame of the 2014-2016 arbitration, allegedly cast doubts as to his independence and impartiality. On this basis, the State aimed at having the award set aside and the arbitrator it had initially appointed recuse himself.

The gas company’s prayers for relief were to dismiss the recourse and request primarily for lack of admissibility, alternatively for lack of merits.

II. Anticipatory Renunciation to Challenge an Arbitral Award

A. Validity

The Federal Tribunal started by examining the validity of an anticipatory renunciation to challenge arbitral awards.

It first referred to article 192 (1) SPILA which provides that “[w]here none of the parties has its domicile, its habitual residence, or a place of business in Switzerland, they may, by an express statement in the arbitration agreement or in a subsequent agreement in writing, exclude all setting aside proceedings, or they may limit such proceedings to one or several of the grounds listed in Article 190, paragraph 2”. As neither party had any such link to Switzerland, they were as a matter of principle entitled to renounce their right to challenge the award.

The Federal Tribunal then (re)affirmed that an indirect renunciation was not sufficient.
The renunciation must be direct, without however having to explicitly refer to articles 190 and/or 192 SPILA. For a renunciation to be valid, the parties must univocally express their common renunciation (“de manière claire et nette”), which is notably not the case of the sole mention “sans appel” (no appeal). Determining the parties’ intent is a matter of interpretation.

In the case at hand, the Federal Tribunal was of the view that the wording of the disputed clauses showed the parties’ clear and common intent that the arbitral award could not be “appealed” against. Not only was the last sentence of the dispute resolution clause univocal but the parties’ common intent also derived from the use of the words “final” and “conclusive” and the fact that the parties limited a recourse to a State court only for enforcement purposes. The questioned remained however what “appeal” actually meant.

B. Extent of the Renunciation

1. Overview of Previous Decisions

To support its reasoning, the Federal Tribunal referred to previous decisions where it had interpreted the notion of “appeal” within the same context.

In one decision, it had highlighted two possible interpretations of the word “appeal”, i.e. one wide, the other narrow. The former encompasses any means to challenge a decision (recourse lato sensu) whereas the latter solely designates the ordinary means of challenging a decision which is generally suspensive, devolutive and reformatory (recourse stricto sensu) and is not admissible before the Federal Tribunal in relation to international arbitration. The Federal Tribunal then interpreted the wording of the arbitration clause which read “all and any rights of appeal from all and any awards insofar as such exclusion can validly be made” and held that the use of the words “rights of appeal” and “all and any” clearly ruled out any appeal lato sensu, such that the renunciation was valid and the “appeal” inadmissible.

In two other cases, both involving the same parties and the same dispute resolution clause, the Federal Tribunal had to examine the validity and extent of a renunciation to challenge an award where the disputed agreement provided that “[n]either party shall be entitled to commence or maintain any action in a court of law upon any matter in dispute arising from or concerning this Agreement or a breach thereof except for the enforcement of any award rendered pursuant to arbitration under this Agreement. The decision of the arbitration shall be final and binding and neither party shall have any right to appeal such decision to any court of law”. It held that the word “appeal” had to be interpreted widely and that such clause clearly showed the parties’ common intent to exclude any challenge of the awards. Accordingly, the renunciation was held to be valid and the civil recourses inadmissible.

In a later decision, the Federal Tribunal took the view that the sentence “neither party shall seek recourse to a law court nor other authorities to appeal for revision of this decision” could not be understood in good faith otherwise than the parties’ clear common intent to exclude any right to challenge the arbitral award. The civil recourse was thus regarded as inadmissible.

Lastly, in a decision rendered in January 2017, the Federal Tribunal considered the sentence “[t]he decision of the arbitrator in any such proceeding will be final and binding and not subject to judicial review. Appeals to the Swiss Federal Tribunal from the award of the arbitrator shall be excluded […]” as a valid renunciation making the civil recourse lodged inadmissible.

2. The Case at Hand

a. The Civil Recourse

The Federal Tribunal held that the word “appeal” ought to be understood in its broad meaning in the case at hand (supra, II. B. 1.). Firstly, this resulted from the fact that no challenge of the award before an arbitral tribunal was possible under the UNCITRAL Arbitration Rules, which the parties had chosen (art. 32 (2) of the 1976 Rules). Secondly, the parties could not have wanted to solely renounce an appeal stricto sensu for none of the lex arbitri (Swiss law), the lex causae and the law of the seat of the gas company provided for such a means of recourse. Thirdly, the dispute resolution clauses which provided that the seat of the arbitral tribunal would be in Switzerland had been drafted by lawyers. Accordingly, one could only understand that the parties had renounced the only (ordinary) available means of recourse to challenge an award, i.e. the civil recourse.

As a result, the State’s civil recourse was held inadmissible.

b. The Request for Revision

The State argued that irrespective of a possibly valid renunciation to the ordinary means of challenging an award, i.e. the civil recourse, such renunciation did not encompass the extraordinary means of challenging of an award that is the request for revision (supra, I.).

The Federal Tribunal pointed out that the request for revision had been lodged within the time limit applicable to the civil recourse and that it was as a matter of principle, due to its extraordinary character, secondary in nature to the civil recourse. It then expressed the view that it was difficult to admit that a party having validly renounced the challenge of an award on the ground that the sole arbitrator was improperly appointed or the arbitral tribunal was improperly constituted (art. 190 (2) SPILA) could nonetheless invoke the same ground to challenge the award but through a request for revision. It confirmed the view it had already expressed, i.e. that deciding otherwise would deplete article 192 SPILA of its bearing. Arguing the contrary would “breach good faith to the highest degree”.

Accordingly, the request for revision was considered inadmissible as well.

III. Remarks and Conclusion

The herein commented decision, due to be published in the Federal Tribunal’s collection of its most important decisions, is interesting for arbitration practitioners in several respects.

It serves as a useful reminder on how parties located outside Switzerland may validly renounce their right to challenge arbitral awards, an option which all leges arbitrii do not feature, and is practical insofar as it summarises past decisions where the Federal Tribunal has upheld renunciation clauses. It is also enlightening in terms of the possibly unexpected consequences when agreeing on a renunciation clause, the scope of which is not limited to certain grounds for challenges (art. 190 (2) SPILA), as the renunciation may then affect not only the ordinary civil recourse – which may often be the only challenge contemplated by the parties – but also the extraordinary request for revision – which the parties may not have in mind at that time – whenever the ground asserted can be invoked within both contexts. Accordingly, parties to contracts must be careful what they wish for in terms of dispute resolution as they may just get it… and more.

Also noteworthy are the very significant costs of the decision: the State was ordered to pay the Federal Tribunal no less than CHF 200’000 of legal costs and the gas company CHF 250’000 to cover attorney fees. The fees of the Federal Tribunal are in principle capped to CHF 100’000 when the value at stake exceeds CHF 10 million. However, by way of exception, fees may go beyond that amount and up to CHF 200’000 in particular circumstances not specified in the law. The high fees in casu may certainly be attributed, at least partially, to the three exchanges of submissions.

Lastly and amusingly, the Federal Tribunal, in line with its practice, blanked out the names of the parties. It did however not blank out the dates of enactment of the arbitration laws of the lex causae (the law of the State challenging the award) and of the seat of the gas company which it referred to, thereby undermining the relevance of blank outs.

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The post Anticipatory Renunciation to Challenge Arbitral Awards Under Swiss Law – An Update appeared first on Kluwer Arbitration Blog.

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