28 Jul 2013

THE IBA GUIDELINES ON PARTY REPRESENTATION IN INTERNATIONAL ARBITRATION 2013

Authored by: Clare Raven

THE IBA GUIDELINES ON PARTY REPRESENTATION IN INTERNATIONAL ARBITRATION 2013

The International Bar Association (IBA) is a worldwide association of legal practitioners, with a membership of over 50,000 individual lawyers and over 200 law societies and bar associations. The IBA seeks to “influence the development of international law reform throughout the world.” In May 2013, the Arbitration Committee published Guidelines on Party Representation in International Arbitration.

The Guidelines address issues of counsel conduct and are intended to provide some standardisation of conduct by legal representatives. The Guidelines may be adopted by the parties and/or the Tribunal in an arbitration.

In brief:

  • The International Bar Association (IBA) is a worldwide association of legal practitioners.
  • In May 2013, the Arbitration Committee published Guidelines on Party Representation in International Arbitration.
  • The Guidelines address issues of counsel conduct and are intended to provide some standardisation of conduct by legal representatives.
  • The Guidelines may be adopted by the parties and/or the tribunal in an arbitration.

The Guidelines

Guideline 1 sets out formally that the Guidelines shall apply where the parties have agreed. Yet the second part of Guideline 1 provides that the Guidelines will also apply to the extent that “the Arbitral Tribunal, after consultation with the parties, wishes to rely upon them after having determined that it has the authority to rule on matters of Party representation to ensure the integrity and fairness of the Arbitral proceedings”.

Although Guideline 3 states that they are not intended to displace otherwise mandatory laws or “to derogate from the arbitration agreement or to undermine either party’s representatives primary duty of loyalty to the party whom he or she represents” it is not clear how this will be interpreted. The commentary to the Guidelines specifically states that “it remains for the Tribunal to make a determination as to whether it has authority to rule on matters of Party Representation and to apply The Guidelines”.

Therefore potentially an Arbitral Tribunal may decide to adopt an activist approach to the application of the Guidelines despite the absence of the agreement of the parties.   
 
Particular Guidelines to note are Guidelines 5 and 6 which provide in summary:

  • after constitution of the Arbitral Tribunal, a party should not appoint a representative who has a conflict of interest with an arbitrator on the tribunal; and
  • if a party breaches the above guideline, the Arbitral Tribunal has the power to, amongst other things, exclude participation by the conflicted representative in part or all of the proceedings.

If an arbitration is carried out under the DIAC rules alone, an already-constituted tribunal has no option to prevent a conflicted lawyer from acting for a party in ongoing proceedings. It is the conflicted arbitrator who must either resign from his or her appointment or refuse involvement in the panel’s future deliberations, rulings or award. If the arbitrator discloses the conflict but does not take action then it is up to the DIAC or the other party to take action to have him or her replaced. In other words, there is nothing to prevent the conflicted representative from acting. If no action is taken by the arbitrator, the DIAC or the opposing party it opens up a possibility that the tribunal’s final award may be nullified due a procedural irregularity.
 
In contrast, if the Guidelines are applied, it will be the party instructing the conflicted representative that is left to suffer the consequences when the tribunal prevents his representative taking part in the proceedings.
 
Guideline 9 prohibits a representative from making a knowingly false submission of fact to the Arbitral Tribunal. Guideline 10 provides that in the event the Party Representative learns that they have made a false submission of fact, the Party Representative should, subject to countervailing considerations of confidentiality and privilege, promptly correct such a submission.
 
Guideline 16 states that a Party Representative should not suppress or conceal or advise his client to suppress or conceal documents which have been requested by another Party or that he has undertaken to or been ordered to produce.
 
Guidelines 18 to 25 deal with witness evidence and the way in which Party Representatives are involved in taking such evidence including the payment of witnesses.

The Guidelines do have a course of action available to the Arbitral Panel in the event that a Party Representative breaches the Guidelines or in the language of the Guidelines “has committed Misconduct.” Guideline 26 provides that the Tribunal may admonish a Party Representative, draw appropriate inferences in assessing the evidence relied upon, or the legal arguments advanced by the Party Representative, consider the Party Representative’s Misconduct in apportioning the costs of the arbitration and take any other appropriate measure in order to preserve the fairness of the proceedings.  
 
Therefore it is arguable that some of the Guidelines go beyond what is required of lawyers practicing in the UAE. It remains to be seen how the Guidelines will be interpreted by Arbitrators where the seat of an arbitration is in the UAE.

This article, including any advice, commentary or recommendation herein, is provided on a complimentary basis without consideration of any specific objectives, circumstances or facts. It reflects the views of the writer which may, in some cases, differ from those of the firm, especially in the develop jurisdiction of the UAE.