When parties contract to resolve disputes by arbitration, they waive rights to have their dispute proceed through the public court system. Accordingly, national arbitration laws and rules of arbitral institutions have evolved to provide procedural safeguards to ensure that parties are treated fairly and equally and given an opportunity to present their case before a determination is made by a lawfully constituted tribunal. The concept of 'due process' is therefore given significant protection in international arbitration.
Summary proceedings and judgements have historically been considered contrary to the requirement for demonstrable and transparent procedural fairness in arbitration, with the main concern being that summary awards would be more vulnerable to challenge. As a consequence, there has been an historic perception that it is all too easy for a party to run an unmeritorious claim or defence in arbitration proceedings without any tangible risk of it being struck out before the case reaches a full hearing.
What power do arbitrators have to expedite procedure?
It is unusual for parties to include specific provisions in their arbitration agreement allowing summary determination. The question of whether such an approach is competent will therefore usually depend on the arbitral rules selected by parties. In recent years, the leading arbitral institutions have taken steps to address the balance between the requirement for due process and the need for procedural efficiency. There is now a plethora of powers available to tribunals that provide a route for expeditious progress and even applications for summary dismissal of claims and defences.
There are noteworthy examples of clear rules directly addressing the need for restoring balance. For example, the rules of the Singapore International Arbitration Centre (SIAC) empower SIAC tribunals to dismiss a claim or defence early if it is "manifestly" without merit. Similarly, the rules of the Arbitration Institute of the Stockholm Chamber of Commerce and those of the Hong Kong International Arbitration Centre, allow parties to apply for certain issues of fact or law to be considered summarily. Such applications may be made where there is an issue of law that, if determined on its own, would dispose of all or part of the dispute without the need for evidence.
Some institutions do not offer clear rules addressing these concerns. However, a party may seek to argue that a tribunal's broad discretionary procedural powers permit summary disposal of issues. For example, many of the institutional rules require tribunals and arbitrators to adopt procedures that avoid unnecessary delay and expense. It may be said that, in certain cases, considering summary dismissal applications may achieve that objective and, taking into account cost and efficiency considerations, may be the fairest process to parties (thus satisfying the need for due process). Guidance released by the International Court of Arbitration (ICC) in October 2017 recognises the way in which these broad case management powers can be used – the guidance confirms that applications can be made for expeditious determination of manifestly unmeritorious claims, even though there is no express provision dealing with the issue in the relevant ICC rules.
In the absence of express provisions there is scope for dispute in relation to what can be done summarily in arbitration proceedings. Indeed, even when there are express provisions in place, arbitrators may be wary of granting summary orders (as indeed should parties be given the risk of enforcement challenges). With many tribunals still likely to err on the side of caution, potential applications for summary measures require careful consideration to assess whether the potential benefit outweighs the uncertain prospects of success, whether within the arbitration itself or at the enforcement stage.
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