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Arbitration has been foreshowed as a more striking and beneficial form of dispute resolution to traditional litigation; however the rise in the use of guerrilla tactics in international arbitrations is now seen as a poignant and real threat to disputing parties continuing to avail of arbitration over Court litigation. In recent years, there has been a rising chorus of complaints about the deployment of guerrilla tactics in international arbitration. Guerrilla tactics begin where a party no longer uses these safeguards as a shield, but as a weapon to assault the integrity of the arbitral proceedings. A real ‘guerrilla’ is a party who only refers to the rules when expedient but is otherwise intent on obstructing, delaying, derailing, and/or sabotaging the arbitral proceedings, and ultimately attempting to pervert the course of justice in order to obtain the desired result.
Arbitration, both commercial and investor-state related, is a growing global market. Traditionally arbitration has been heralded as a more attractive and advantageous form of dispute resolution to traditional litigation; however the rise in the use of guerrilla tactics in international arbitrations is now seen as a poignant and real threat to disputing parties continuing to avail of arbitration over Court litigation.
In recent years, there has been a rising chorus of complaints about the deployment of guerrilla tactics in international arbitration. These tactics range from document destruction and witness tampering to abusive cross-examination. When faced with such tactics, it is very easy for advocates and their clients to become angry and frustrated. This can lead to responses that are counterproductive and may ultimately undermine the client's overall strategy and objectives.
We now have a sound and reflective attitude towards arbitration but if guerrilla practice continues there will be a huge possibility to lose the flexibility of International Commercial Arbitration that makes it attractive. The biggest challenge will be trying to preserve its flexibility, avoiding too many rules and codes and, above all, avoiding the one-fits-all approach in the conduct of the proceedings.
The term ‘guerrilla tactic’ was coined by Michael Hwang in 2005. For him, the term described those whose aim was ‘to exploit the procedural rules for their own advantage, seeking to delay the hearing and (if they get any opportunity) ultimately to derail the arbitration so that it becomes abortive or ineffective’.(1) Guerrilla tactics in arbitration aim at winning a case or even humiliating the other party. Gunther Horvath considers guerrilla tactics to involve ‘strategies employed by parties to arbitration proceedings that are ethical violations, involving criminal acts, or ethically borderline practices’.(2) For Edna Sussman, the adoption of ‘strategies, methods and tactics, ranging from poor behaviour to egregious and even criminal conduct’, sum up guerrilla tactics.
According to Sussman, the following behaviour may be identified as ‘guerrilla’ tactics in arbitration; unethical practices in document production/disclosure, unwarranted delay tactics, creating conflicts, frivolous challenges to the arbitrators, last minute surprises, and anti-arbitration injunctions. It also includes ex-parte communications, witness tampering, lack of respect or courtesy towards members of the tribunal and opposing counsel.
As is evident from the above, this concept, in so far as arbitration is concerned, is an amalgamation of various components which are too broad to be brought into one strict definition. Guerilla tactics is all about behaviour, which may range from blatant measures involving illegal or unethical conduct to more subtle, underhand manoeuvres. Hence, in order to understand the behaviour, the essential elements of these tactics must be understood. These elements are deviance, tactics, and intent.
Nature of Guerilla tactics
Guerilla tactics deviate from the conventional scope of law and ethics; while it is always unethical, it may not in every instance amount to a violation of law or written procedural rules. Nonetheless, such behaviour most often constitutes a hindrance to arbitral proceedings. The deviance may differ based on the rigidity of the norm in question.
Accordingly, one can distinguish between these types of practices which are (a) ‘common’forms of guerrilla tactics, which amount to obvious misconduct, (b) ‘extreme’ guerrilla tactics such as severe criminal acts and blatant abuse of state authority; and (c) ‘rough riding’ which cannot be categorized as guerrilla tactics at all.(3) Where exactly the conduct in question falls may well be a matter of personal opinion.
However, the proposition that is free of any ambiguity is that guerrilla tactics cannot exist in a vacuum, sans any deviance. Another element of guerrilla tactics that deserves attention is the ‘tactical’ element, i.e., the party’s deliberate engagement with the action in question, rather than the mere exploitation of coincidences or unforeseen developments. For instance, a heated argument at an evidentiary hearing that results in an assault, could in certain circumstances be regarded as ‘tactical’, if a party deliberately executes or provokes the assault.(4)
Presuming that the intent is the starting point and the deviance is the finishing line, then the ‘tactical’ element is a means to that end. The continuous and strategic employment of such tactics connotes guerrilla tactics. Guerrilla tactics are chosen in cases where the sole intention is to obstruct the proceedings or to hinder the other party.
Guerrilla tactics begin where a party no longer uses these safeguards as a shield, but as a weapon to assault the integrity of the arbitral proceedings. A real ‘guerrilla’ is a party who only refers to the rules when expedient but is otherwise intent on obstructing, delaying, derailing, and/or sabotaging the arbitral proceedings, and ultimately attempting to pervert the course of justice in order to obtain the desired result. A continuous and systematic use of challenges to the arbitrator, such as requests for extension of time and the submission of excessive amounts of documents aimed solely at obstructing the arbitral proceedings can result in the rules being bent to their advantage, and their intended purpose being defeated. Therefore, the intent behind a party’s action forms a large part of the guerrilla tactics.
While tracing the evolution of guerrilla tactics in arbitration, it is necessary to delve into the possible causes as well, though ‘causation’ in this instance is merely a better word for an excuse. The aim, however, is not to justify the acts but to rather explain them. The commercial world prefers arbitration for varied reasons such as autonomy, saving of time or even confidentiality. There are regulatory frameworks within which arbitration is conducted, which are established either by a contract or the arbitral institutions concerned. However, some parties do not wish to venture into the formal rules of arbitration and this tenders them more susceptible to a hostile environment. The aim for any party to arbitration is to obtain the award in their favour. In cases of a ‘last resort tactic’, a party may attempt to follow the ethical practices at the initial stages and subsequently turn to guerrilla tactics. Hence, the initial intention of the party is to promote the spirit of arbitration and not otherwise.
Advocacy involves intricate skills such as witness preparation, docket creation, and ex-parte communication among others. These skills vary from one country to another. The practices relating to arbitration followed in multiple jurisdictions are also varied. For instance preparing a witness to the extent of rehearsing his testimony is unlawful in Britain; whereas in the United States, rehearsal of witness testimony by an advocate is in vogue. (5)
What Constitutes Guerilla Tactics in International Arbitration?
Parties to international business transactions are often driven by a desire to preserve their business relationship and prefer the friendly atmosphere of arbitral proceedings.(6) However, subscribers to international arbitration increasingly complain about the length and cost and more recently, the tactics adopted by lawyers in the course of arbitral proceedings. These complaints reveal that arbitration has fallen victim of its own success.(7) It has now become glaring that the lee-ways and advantages synonymous with arbitration also give room for disadvantages and procedures that are too notorious to be considered merely as bad behaviour.
Adverse conduct by parties/attorneys/lawyers in the course of arbitration proceedings may otherwise be regarded as bad behavior. However, the term guerrilla tactic is often used to describe those actions which are perceived as more hostile practices displayed by parties in arbitration in an attempt to gain a better advantage over the opposing party. Till date, there is lack of clear definition of Guerilla Tactics in International Arbitration. This accounts for why conduct identified by some attorneys as ‘guerilla tactics’ would be defended by others as legitimate strategy, or even as part of an attorney’s obligation to diligently represent the client’s interest. (8)
The list of what constitutes Guerilla Tactics in international arbitration is long and sometimes can hardly be distinguished from bad behaviour on the part of parties or counsel representing parties in an international arbitration. The following have been identified as Guerilla Tactics in international arbitration. (9)
convincing an arbitrator to go home rather than attend deliberations;
changing counsel mid-proceedings to create a conflict with an arbitrator;
wiretapping opposing counsel’s meeting rooms;
hiding damaging documents that were ordered to be disclosed;
raising many challenges to a single arbitral tribunal;
physically assaulting the opposing party;
raising excessive frivolous objections to ‘run the clock’ at an evidentiary hearing;
threatening a witness to dissuade him from testifying; and
absurdly excessive requests for document disclosure
The diversity of commercial disputes results in a complex combination of different legal, regulatory and ethical background amongst the arbitrators and legal practitioners. There is no universal standard or body of rules or regulations to guide the ethics and procedures of parties in arbitration proceedings. There are however, different international bodies and institutions that have made available rules and principles of ethics to bind the conduct of parties in arbitration proceedings but the parties will have to agree to be bound by those rules and principles in the first place. An example is the International Bar Association Rules of Ethics for International Arbitrators.
Factors Responsible for the Rise in the Use of Guerilla Tactics in International Arbitration
First of all, there is the absence of a uniform legal framework regulating ethical conduct of counsel in international arbitration. Ethical issues that are prevalent in international arbitration are numerous and range from conflict of interest, incompetence, lack of candor, dishonesty, and improper communications with opposing parties, to improper arrangements for remuneration for legal representation.(10) These ethical issues often metamorphose into “guerilla tactics” in international arbitration. For instance, where a counsel who is incompetent in an international arbitration resorts to death threats to intimidate a fellow counsel; or where a counsel raises many challenges against a single tribunal arising from dishonesty.
Counsel representing parties in international arbitration usually come from different regulatory backgrounds with respect to laws that govern their professional conduct. As Mosk rightly pointed out, different regimes have a variety of rules or laws applicable to these ethical issues enumerated above. It is also relevant to point out that the extent to which choice of legal principles can govern professional conduct issues cannot be determined easily.(11)
Secondly, erring counsel in international arbitration proceedings cannot be subjected to any forum-state disciplinary system or mechanism as is the case with the judicial system. As there is no uniform code of conduct that binds counsel in international arbitration, there is also no chance of prosecuting or sanctioning any erring counsel or counsel adopting Guerrilla tactics in international arbitration. For instance every state has prescribed punishment or sanctions for counsel that violates the code or rules of the legal profession unlike in international arbitration. There is no oath in international arbitration which the violation can result in prosecution. In situations like this, counsel resort to all sorts of tactics including Guerrilla tactics which serve to favour their clients or their selfish interests.
Thirdly, international arbitral tribunals have very little or limited powers to discipline counsel or parties that engage in conduct that is unacceptable and may be termed Guerrilla tactics. Because counsel appearing before an international arbitral tribunal are not licensed or regulated by that particular tribunal, they can afford to hide damaging evidence or treat a witness unfairly and with impunity.
Another issue or factor responsible for counsel engaging in acts which may be described as guerrilla tactics is that arbitrators are usually paid by parties and appointed by the counsel representing parties. Therefore, this creates a likelihood of bias on the part of arbitrators, and they are more likely to indulge counsel or parties that adopt guerrilla tactics. This raises the issue of arbitrators’ independence and resoluteness. It has been argued that the concept of the “impartiality of party-appointed arbitrators” is mere pretence. (12)
Justification for Guerilla Tactics in International Arbitration
Arbitration guerrillas know that the tribunals will be anxious to be seen as fair and properly appreciative of cultural differences, and they will therefore try and test this accommodating attitude to the maximum by asking for all kinds of indulgences, particularly in requests for an extension of deadlines. In local litigation, counsel for the other party can often comment on the validity of the reasons given in support of the applications for various procedural indulgences, and the local court itself judges the validity of these reasons. It is much more difficult for non-asian counsels and arbitrators to decide on the truth of the reasons advanced by Asian parties for their applications.
Even if they have suspicions about the validity of these reasons and cannot substantiate those suspicions in a manner that can speak for itself in their award, they would still be fearful of a challenge or defence based on a breach of Article 18 of the United Nations Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration or Article V(l)(a) of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention). (13) Michael Hwang has pointed out that such a situation is particularly prevalent in arbitration proceedings in Asia.(14) It is these paradoxes that have worked to rationalise the guerrilla tactics, to a large extent, resulting in them gaining general acceptability.
However, Hwang points out that there are substantial number of local lawyers who do not wish to appear against foreign lawyers before a foreign arbitration tribunal.(15) They do not intend to sabotage arbitration because their clients have no defence, but they sincerely believe that their clients will get a better outcome before a local court for the following reasons - they are inexperienced in international arbitration and are not conversant with the proceedings, they feel that their clients may be at greater risk of liability because they are less capable of predicting the outcome and they believe that their clients’ witnesses may be better believed by a local court rather than a tribunal composed of at least a majority of foreigners.
Ethical Regulations in International Arbitration
Currently, there are no effective mechanisms for the regulation of ethics in international arbitration. This is due to two factors; the absence of enforceable ethical standards in international arbitration, and insufficient powers in the rules of many arbitral institutions to deal effectively with the problems as they arise.(16)
Hence, many jurists have raised concerns in this regard with a specific interest on the development of an effective global code or guidelines to clearly demarcate right and wrong with respect to the behaviour of functionaries in arbitration. The first attempt to revamp the ethical regulations is traceable to the 1990s, when Jan Paulson, severely criticized the state of affairs during those times.(17) Arbitration, as a process, continued to prosper despite such a drawback. People were, and still are, appreciative of the time effectiveness and autonomy attached to an arbitration proceeding. The globalised world has accepted arbitration with its ethical conundrums as long as the disputes have been resolved in a manner chosen by the parties. The problem has, however aggravated since it was not addressed effectively, so much so that ‘guerrillas’ have now become a recognised defect in arbitration.
Hence, the remedial measures have now come to the fore. Recently, Doak Bishop argued that the lack of clarity as to which ethical rules to apply, the existence of conflicting rules and obligations, the non transparency and the increased size of many proceedings, combined with greater public scrutiny, creates certain instability in the system that could result in a future crisis of confidence. (18) He further argued that the only way to gauge public confidence is through a code of conduct which is clear and binding. Such a code must have some essentials, such as the ability to clarify the applicable rules and reduce ambiguity, the ability to create a level playing field, and the ability to provide greater transparency.
The above essentials clearly indicate a concern, though not an immediate one. The academicians and professionals should understand the threat such an act poses to the future of arbitration in the innovative and globalised world. According to Gary Born, a renowned expert in arbitration, the best resolution to such concerns would be the development of a uniform code of international rules of professional conduct, applicable to counsels in international arbitration proceedings.(19)
The biggest question over such a proposition would be the enforcement of that international legal instrument. There are many institutions that may be able to perform such a task, efficiently or otherwise, such as bar associations, local courts, arbitral institutions or tribunals. It will almost certainly be the arbitral tribunals that will be the best equipped to take on such a responsibility.
The reason why arbitral tribunals would be the most preferred in formulating standards of ethical regulation is because of their hands on approach. Tribunals ought to reflect ethical regulations in international arbitration and unethical practices would often be noticed and condemned by the tribunals.
However, the extent to which such tribunals may exercise their powers is a matter of great concerns the powers of the tribunals are decided by the guerrillas themselves i.e. the parties. In case of institutional arbitration this is largely controlled. It is evident from the ICSID decision in Hrvatska Elektroprivreda D.D. v. Republic of Slovenia, in which the question was whether the tribunal’s authority to bar a party selected counsel from appearing before it was based solely on supranational standards of conduct for counsel. The law that was established in this case was that there exists ‘an inherent power [in a tribunal] to take measures to preserve the integrity of its proceedings’.(20)
Based on the above, the tribunal disqualified a British barrister who was not only a member of the same chambers as the president of the tribunal, but was also added as the respondent’s counsel well after the case had begun, and whose involvement was only disclosed before the final hearing. This case, however, seems a bit too radical in its approach and if interpreted widely could lead to a lot of problems in the future.
This position was slightly normalised in the case of Rompetrol Group v. Romania,(20) where the court indicated that even if such powers exist, they are only to be exercised in exceptional and rare circumstances. Though we may have established that tribunals have the ability to exercise such powers, it is to a limited extent. Even if the tribunals decide to exercise this power, they require an internationally accepted code of conduct. The world of arbitration has been plagued with multifarious laws of multiple jurisdictions which cause a lot of confusion at times. Contrary to popular opinion, an internationally accepted code of conduct would help in having clarity. Ethics, as previously explained, has largely been an ignored area of arbitration.
Therefore, an internationally accepted code of conduct would reflect a positive step in filling up this paucity. An attempt in this regard has been made by the International Bar Association (IBA) in 2013. (21)
They framed guidelines on the conduct of parties in international arbitration. In this, they have clearly demarcated the difference between the ‘right’ and the ‘wrong’ behaviour of parties and counsels in international arbitration. These guidelines are stimulated by the principle that party representatives should act with integrity and honesty and should not engage in activities designed to produce unnecessary delay or expense, including tactics aimed at obstructing the arbitration proceedings.(22)
The groundwork for these guidelines was laid down in 2010, when the IBA Task Force sent out a broad survey to arbitration practitioners concerning counsel ethics in international arbitration.
The rationale behind the survey was to help in investigating the different and often contrasting ethical and cultural norms, standards and disciplinary rules that may apply to counsels in international arbitration. The survey was encouraged by the view that the lack of international guidelines and conflicting norms in counsel ethics undermines the fundamental protection of fairness and equality of treatment and the integrity of international arbitration proceedings.(23)
On the basis of the survey results, a working group of the Task Force produced a draft document, in the nature of guidelines. These draft guidelines were first reviewed by the IBA Arbitration Committee’s Officers and later submitted to all members of the Arbitration Committee for consideration. (24) Finally, the IBA Council adopted their guidelines in a resolution on May 25, 2013.
Suggestions & Recommendations
The International Chamber of Commerce (ICC) Commission on Arbitration and ADR submitted a Report titled Techniques for Controlling Time and Costs in Arbitration to assist the Parties and the Tribunal in Arbitration Proceedings. The Reports suggest that:
1. Fast-track procedures should be included to shorten the time spent arbitrating. Article 38(1) of the ICC Rules enables the parties to shorten the time limits provided for in the Rules. It is however difficult to draft this fast track clause because it is impossible to determine how long it will take to settle a dispute. The Report also advises against setting time limits for rendering the final award because it can create jurisdictional and enforcement problems if it turns out that the time limit set is unrealistic or not clearly defined.
2. A more detailed arbitration agreement setting out specific details of the arbitration procedure should be created after the dispute has arisen. This is because ‘the effects of a loose drafting approach are not felt at the drafting stage’. Rather it is when the dispute has arisen from an inelegant draft that blames abound, such as, ‘had I known’. An international arbitration agreement is a contract and so requires the existence of those ingredients for the validity of a contract. The Challenge to international arbitration is that many national laws have different requirements. These additional requirements range from separate execution of arbitration agreements to special prints for the arbitration clause.14 Parties are often encouraged to use the exact words of the arbitration clauses suggested by the arbitral institution that they choose.
3. The post dispute agreement should be very detailed to cover the different ethical clashes that are common in international arbitration. A very succinct and familiar example is the differing opinions counsel have on pre-testimonial communication with witnesses. A scholar recounted that:
‘An Australian lawyer felt that from his perspective it would be unethical to prepare a witness; a Canadian lawyer said it would be illegal; and an American lawyer’s view was that not to prepare a witness would be malpractice.’
It should be noted that in some jurisdictions, it is common practice to prepare a witness. This of course shows the differing opinions and how a clash of this seemingly minor opinion might be used by a ‘guerrilla’ to delay or frustrate proceedings by constantly challenging and disputing ethical differences.
4. On the selection of arbitrators, it will be better to have a sole arbitrator, selected and appointed by the ICC to ensure faster decision making and prevent the constant and unnecessary challenges faced by the arbitrator which may delay proceedings.
5. With regard to experience, the counsel and arbitrators to be appointed should have no time constraint and vast experience in case management.
Understandably, and as a result of the semblance between arbitration and litigation, it is advised that some of the judicial powers and privileges (as a Judge is a King in his own Court) granted to judges should be accorded arbitration panels. Due to the contractual nature of arbitration, even the laws that parties may subscribe themselves to willingly, may result in the parties autonomy by using expressions such as ‘the parties are free to…’ or unless otherwise agreed by the parties…’. This freedom appears be too wide in some instances because if one party is recalcitrant, the freedom which was intended to ease the proceedings may be employed as a tool to frustrate the proceedings. However, it is suggested that this freedom is a compensation for the lack of a right to appeal the substance of arbitral awards. With respect to Attorneys/Lawyers, it would be preferable if the “gladiator” acts of brazen showmanship displayed in the Courtroom often to earn professional fees should not be entertained in arbitration proceedings.
The International Bar Association also provides Rules of Ethics for International Arbitrators. Although the provisions are not generally binding to all international arbitration or conciliation proceedings, parties may include a certain clause to be bound by the provisions of the Rules. The Rules cover, Acceptance of Appointment as Arbitrator, elements of bias, duty of disclosure, communication with parties, fees, duty of diligence, involvement in settlement proposals, confidentiality of deliberations, and the Fundamental Rule instructing Arbitrators to proceed diligently and efficiently to provide the parties with a just and effective resolution. The binding clause provides the consequence(s), which are removal from position as arbitrator on the panel and forfeiting remuneration.
Suggestions for Counsel and Arbitrators
‘An interim measure is any temporary measure, whether in the form of an award or in another form, by which, at any time prior to the issuance of the award by which the dispute is finally decided, the arbitral tribunal orders a party to:
a) maintain or restore the status quo pending determination of the dispute;
b) take action that would prevent, or refrain from taking action that is less likely to cause current or imminent harm or prejudice to the arbitral process itself;
c) provide a means of preserving assets out of which a subsequent award may be satisfied; or
d) preserve evidence that may be relevant and material to the resolution of the dispute.’(25)
Not all Arbitral Tribunals have the power or authority to order interim measures. However, it is generally a matter of practice and most arbitration laws confer the power to order interim measures on the arbitral tribunals. In line with the autonomy principle associated with arbitration, parties can also confer the power to order interim reliefs on the tribunal via the arbitration agreement. The parties will need to agree on how exactly the powers should be carried out. The arbitration agreement should provide that the arbitral panel must consider substantial prejudice, proportionality or balance of convenience, reasonable chance of success on the merits, urgency and that the appropriate security to be provided by the arbitral tribunal.(26)
The arbitral panel must however be careful in issuing interim measures. Consideration has to be given to the relevant laws of the State court (because it is only a court that can enforce the measure), and the measure that will be appropriate for the relevant contract. For example, in Switzerland, the tribunal is permitted to order measures not provided by the Swiss Private International Law Act (PILA). The problem with this being applied to other countries is that, since a state court may only issue measures that are admissible under its own rules of civil procedure applicable at the place and time where it is located, it may hinder the enforceability of such interim orders issued by an arbitral tribunal.(27)
It is however pertinent to note that these measures are only interim in nature and unless otherwise agreed by the parties, the arbitral tribunal may, at the request of a party, order any party to take such interim measure of protection as the arbitral tribunal may consider necessary in respect of the subject-matter of the dispute. (28)
Counsel must ensure that the International Rules and Guidelines are included and set as the standard in an arbitration proceeding. This is because in the event that issues arise during the arbitration proceedings, including challenging the independence or impartiality of the arbitrator, the state in deciding, will have to give cognizance to the International Rule or Guideline because the agreement provides so. However, Courts are not eager to accept International Rules. A suggested reason is the belief that domestic law provides a comprehensive regime governing arbitrators’ independence and impartiality. (29)
To combat guerrilla tactics in international arbitration, arbitrators must do their absolute best to avoid giving room to recalcitrant parties whose objectives are to abuse or frustrate the arbitration process. A common saying in our jurisdiction is; “prevention is better than cure” and this is a principle that parties to international arbitration proceedings should live by. Some of the common issues that parties encounter, will be distilled to serve as a caution sign. They include, challenging the arbitrators, the jurisdiction, governing laws and most importantly, the validity of the arbitration agreement.
Challenging Appointed Arbitrators
This is a window provided for by most countries and international institutions to ensure fair hearing in international arbitration. If a party reasonably suspects that an arbitrator is not independent and/or impartial, he has the right to challenge the arbitrator claiming that arbitrator is compromised and therefore will give an unfair and biased award. The dictum ‘nemo debet esse judex in propria causa’ is a principle of natural justice and it means that a party cannot be an arbitrator in his own case. It is also backed up by the IBA Guideline which provides that “no one is allowed to be his or her own judge” (i.e, there can be no identity between an arbitrator and a party). Although in Gary B. Born’s International Commercial Arbitration (30) the author separates the features in disputes over an arbitrator’s independence and impartiality into different sub headings.
Therefore, it is advised that parties should refrain from appointing arbitrators who have a pecuniary interest or otherwise in the disputes no matter how remote, arbitrators who are in the employment of a party to the dispute, or had prior involvement in the dispute, business, personal or family relationship with a party and prior representation of a party amongst others. It translates to the point that only experienced arbitrators should be involved in international arbitration. The arbitrators should practice full disclosure of conflict of interest, refrain from making comments or expressions of opinion during the arbitral proceedings, and, avoid ex parte contacts during arbitration as some institutional rules and international rules forbids it.(31)
During Post arbitration proceedings, some parties use the legitimate grounds for annulment of International Arbitral Awards, in order to frustrate the enforcement of the awards. Some of the grounds for annulment are: non-existent or invalid arbitration agreement, lack of fair hearing, failure to comply with agreed rules and procedures, ultra vires acts, lack of independence and impartiality of the arbitrators, fraud and public policy amongst others. It is therefore imperative that arbitrators ensure awards written in international arbitration are not tainted with such irregularities that may lead to the challenge of the jurisdiction of the tribunal or the award.
Dealing with Guerrilla Tactics that are Unethical
This quote “International arbitration dwells in an ethical no-man’s land” (32)is an apt description of the peculiar nature of international arbitration and consequently the avenue that allows for guerrilla tactics. This is because proceedings are not regulated by the national laws that regulate arbitration on a local platform and therefore ethics and professionalism are sometimes sacrificed on the altar of freedom. The core substantial and procedural standards that a counsel should abide by are often abandoned and what is supposed to be a civilized dispute settlement becomes white-collar guerrilla warfare.
The core principles of a lawyer’s professional conduct include “the lawyer’s obligation zealously to protect and pursue a client’s legitimate interests, within the bounds of the law, while maintaining a professional, courteous and civil attitude toward all persons involved in the legal system”.(33)
The understanding of some lawyers practicing guerrilla tactics may be hinged on the desire to earn their fees. They believe that the tactics are mere necessities to ensure they are zealously protecting and pursuing a client’s legitimate interest.
As a general rule, arbitral tribunals may order whatever measures they deem necessary to protect the rights of the requesting party from harm that cannot later be remedied by the final award; or they may regulate the relationship between the parties during the arbitral proceedings.
Unreasonable Request for Documents:
Where a counsel representing a party in an international arbitration suspects the use of guerrilla tactics in the course of the arbitral proceedings, it is suggested that he should bring it to the attention of the arbitral tribunals with immediate effect so that the tribunal can deal with it decisively once and for all.
The ethical conundrums have carved a special space in international disputes so much so that the entire future of arbitration depends largely on the ethical and procedural viability of the available checks and balances. This is due to the fact that such ethical issues determine the credibility of arbitral procedures. Just like any other service, the credibility establishes the longevity.
Likewise, only if we produce an environment that is conducive to a fair process to both the parties, can we ensure a future for international arbitration. Though the major opposition to arbitration comes because of the existing or perceived time and cost inefficiencies, another criticism that is to be levelled against arbitration is the perceived lack of transparency and legitimacy of the system as a whole.
Further, we see that the recent global financial crisis has aggravated the tendency of dishonest parties to resort to unethical or illegal means of achieving their goals. Although the guerrilla tactics in international arbitration have come to be recognized, we are yet to see a regulatory change that accommodates the ethical overhaul that is required to meet the changes in arbitration proceedings. We must concede, however, that in the arbitral community today, we have a substantial number of elites who subscribe to the proposition that there is no rule in international arbitration. It is evident, therefore, that the ethical organ of arbitration is yet to evolve and is presently in a period of transition. Though such behaviour is recognized and rightly condemned, the legal treatment of such a situation still remains controversial.
1. Michael Hwang, Why is There Still Resistance to Arbitration in Asia?, Global Reflections nn International Law, Commerce and Dispute Resolution – Libor Amoricum in Honour of Robert Briner, 401(Gerald Aksen et al. eds., ICC Publishing 2005).
2. Guerrilla Tactics in Arbitration, and Ethical Battle Field: Is There a Need For Universal Code of Ethics?AUSTRIAN Y.B. INT’L ARB. 297-313 (Klausegger et al. eds. Manz, C.H. Beck, Stämpfli 2011).
3. Oprisan Fruth Despina, Facing the Reality of Guerrilla Tactics in Romania, 7(2) T.D.M. 3-5 (2010).
4. Charles Toutant, Arbitrator is Not Liable for Attorney's Alleged Assault of Party Court Says, N.J.L.J. 1 (2008); ICC Court Names New Secretary General, 7(3) G.A.R. 2 (2012).
5. Günther Horvath, How May Commercial Arbitral Tribunals Cope With and Sanction Guerrilla Tactics of the Parties/Their Counsel?, 7 (2) T.D.M. 10 (Nov. 2010).
6. Klaus Peter Berger, Private Dispute Resolution in International Business. P 308
7. Rivkin, Arb. Int’l (2008), 375, 377.
8. Catherine A. Rogers, ‘Guerrilla Tactics in International Arbitration: Ethics, Practice, Remedies’ Legal Studies Research Paper No. 23-2013.
9. Günther J. Horvath, Stephan Wilske, Guerrilla Tactics in International Arbitration, International Arbitration Law Library, 2013, ISBN 13: 9789041140029.
10. Stephan Wilske, ‘Arbitration Guerrillas at the Gate: Preserving the Civility of Arbitral Proceedings when the Going Gets (Extremely) Tough’, in Austrian Yearbook on International Arbitration, ed. Christian Klausegger et al. (Manz'sche Verlags-und Universitätsbuchhandlung, 2011), 315-319.
11. Richard M. Mosk, ‘Attorney Ethics in International Arbitration’ (2010) 5 Berkley Journal of International Law Publicist 32, p. 33.
12. Richard Mosk & Tom Ginsburg, ‘Evidentiary Privileges in International Arbitration’ (2001) 50 International and Comparative Law Quaterly 345. Mosk, (n 13) at p. 36.
13. Convention on the Recognition and Enforcement of Foreign Arbitral Awards. 1959 330 UNTS 3.
14. Michael Hwang, Why is There Still Resistance to Arbitration in Asia?, Selected essays on International Arbitration, 2013, 25 available at http://www.transnational-disputemanagement.com/downloads/MH_Selected-Essays_on_IA.pdf (last visited 30 Jan. 2014).
15. Michael Hwang, Why is There Still Resistance to Arbitration in Asia?, Selected essays on International Arbitration, 2013, 27 available at http://www.transnational-disputemanagement.com/downloads/MH_Selected-Essays_on_IA.pdf (last visited 30 Jan. 2014).
16. William W Park, Arbitrations Discontent: Of Elephants and Pornography, JOURNAL OF INT’L ARB. 263 (2001).
17. Jan Paulsson, Standards of Conduct for Counsel in International Arbitration, MKM REV. INT'L ARB. 3 214 (1992).
18. R. Doak Bishop, Advocacy and Ethics in International Arbitration: Ethics in International Arbitration, Arbitration Advocacy in Changing Times, ICCA Congress Series No. 15 2010, Rio, 383-390 (Kluwer International Law 2011).
19. GARY BORN, INTERNATIONAL COMMERCIAL ARBITRATION, 2318-2319 (Alphen aan den Rijn; Kluwer Law International 2009).
20. Hrvatska Elektroprivreda D.D. v. Republic of Slovenia, ICSID Case No. ARB/05/24 (Tribunal's Ruling regarding the participation of David Mildon QC in further stages of the proceedings) ¶ 33 (May 6, 2008).
21. Rompetrol Group v. Romania, (ICSID Case No.ARB/06/3) Award (May 6, 2013).
22. IBA Guidelines on Party Representation in International Arbitration (2013) available at http://www.ibanet.org/org/Document/ Default.aspx? Documentuid=6FOC57D7-E7A0-43AF-B76E-714D9FE74D7F.
23. IBA Guidelines on Party Representation in International Arbitration (2013) available at http://www.ibanet.org/org/Document/Default.aspx?Documentuid=6F OC57D7-E7A0-43AF-B76E-714D9FE74D
24. IBA Arbitration Committee Survey (2010), available at 1.www.ibanet.org/Article/Detail.aspx?ArticleUid=610bbf6e-cf02-45-ae8c3a-70dfdb2274a5 at 9.
25. IBA Arbitration Committee Survey (2010), available at www.ibanet.org/Article/Detail.aspx?ArticleUid=610bbf6e-cf02-45-ae8c3a-70dfdb2274a5.
26. Art 17(2) of the revised UNICITRAL Model Law
27. Interim Relief in International Arbitration, Dispute Resolution International Vol. 1 No. 2 December 2007 pp 176-178
28. Interim Relief in International Arbitration, Dispute Resolution International Vol. 1 No. 2 December 2007 pp 179.
29. Redfern and Hunter, Law and Practice of International Commercial Arbitration p 338, notes 7-22.
30. Dispute Resolution International, IBA Guidelines on Conflict of Interest in International Arbitration p 6
31. International Commercial Arbitration; Selection, Challenge and Replacement of Arbitrators pp 1517 – 1528.
32. International Commercial Arbitration; Selection, Challenge and Replacement of Arbitrators pp 15.
33. Rogers, Fit and Function in Legal Ethics: Developing A Code of Conduct for International Arbitration, 23 Mich. J. Int’l. 341, 342 (2002).