The final panel session of the SIAC Virtual Congress 2021 addressed the long-standing issue of the role of arbitral institutions in controlling the time and costs of arbitral proceedings. The session was moderated by Mr Toby Landau QC (Vice President, SIAC Court of Arbitration; Barrister and Arbitrator, Duxton Hill Chambers (Singapore Group Practice)). Joining the discussions were Prof. Dr. Mohamed Abdel Wahab (Founding Partner and Head of International Arbitration, Construction and Energy, Zulficar & Partners Law Firm), Ms Chiann Bao (Arbitrator, Arbitration Chambers), Mr Dmitry Dyakin (Member, SIAC Court of Arbitration; Partner and Co-Head, Dispute Resolution Practice, Rybalkin, Gortsunyan & Partners), Ms Koh Swee Yen (Partner, WongPartnership LLP), and Ms Yoshimi Ohara (Partner, Nagashima Ohno & Tsunematsu).
With the aim of identifying the culprits of delays and excessive costs of arbitral proceedings, Mr Landau QC proposed to proceed by evaluating the roles of four prime suspects:
- Institutions and institutional rules.
- Arbitrators themselves.
- The arbitral procedure
- Counsel themselves.
Institutions and institutional Rules
The session began with a discussion on the necessity of setting time periods for institutional activity. Ms Bao noted that while institutional rules typically contain timelines for arbitrators and counsel, they rarely regulate institutional activity. At most, institutional rules include provisions requiring institutions to do something “as soon as practicable”. While she acknowledged that such an inquiry would necessarily differ for each case, she shared that having some parameters would be desirable.
Illustrating this, the panel zoomed in on delays in the scrutiny process for arbitral awards. Prof. Dr. Abdel Wahab highlighted that while close scrutiny protects awards from potential setting aside applications, the corollary is that the process is often drawn-out or perceived to be so. He thus suggested that institutions could provide rough estimates of the timelines involved in the scrutiny process.
Concluding this issue, the panel considered whether sanctions should be imposed alongside the recommendation for prescribed timelines. Specifically, Mr Landau QC questioned whether institutions should forfeit their fees where there was undue delay in their operations, which 86% of poll respondents voted in favour of via Zoom’s polling function.
The discussion then shifted to institutional fees and whether there is room for review. Ms Bao shared that institutions’ administrative fees are often overlooked as they often occupy a fraction of the costs of arbitration. Prof. Dr. Abdel Wahab remarked that institutions could provide an annex to their rules, listing out the various additional services that may be rendered and their corresponding prices. Concurring, Mr Dyakin shared that if institutions are more transparent regarding costs and time issues, this would create more competition and incentivise internal regulation of these matters.
Top row (left to right): Mr Toby Landau QC and Ms Chiann Bao.
Middle row (left to right): Ms Koh Swee Yen and Ms Yoshimi Ohara.
Bottom row (left to right): Prof. Dr. Mohamed Abdel Wahab and Mr Dmitry Dyakin.
Arbitrators
Responding to the sensitive issue of transparency in how arbitrators clock their hours and charge, Ms Ohara suggested that such information be collated and shared with parties while proceedings are ongoing. Ms Koh posited that although transparency is desirable, parties may use such data to mount challenges against arbitrators. Prof. Dr. Abdel Wahab concurred, adding further that there is disparity in practice regarding how arbitrators measure their time or keep records. Thus, he suggested that arbitral institutions take the lead in providing templates and guidelines to arbitrators.
Case counsel and their role in reducing delays was next on the agenda. Ms Koh opined that case counsel could check in on the tribunal regularly and advise them accordingly, thereby moving the arbitral process along in a timely fashion. She then suggested that institutions could even tap on their case counsels’ experience to develop a “blacklist” of arbitrators who unduly delay proceedings.
Viewers were thus invited to vote again, this time on the desirability of a temporary institutional moratorium on appointing arbitrators who have unduly delayed the rendering of awards. Although 95% of viewers voted for this, Ms Ohara highlighted that institutions could consider a “carrot-and-stick” approach by also rewarding tribunals that are efficient.
Arbitral procedure
Next, Mr Landau QC directed the panel to consider the role of institutions in controlling the arbitral procedure itself, specifically through institutional rules revision.
Ms Koh highlighted recent revisions to expedited procedure rules that allow tribunals to order “documents-only” arbitrations. However, in her experience, tribunals are still hesitant to exercise this power if one party requests otherwise. She suggested revising the rules to make documents-only arbitration the default. Ms Bao agreed with the idea but noted that it might be more palatable to set out soft guidelines instead.
Mr Landau QC concurred, citing due process paranoia as one of the main reasons why tribunals are generally reluctant to override the parties’ wishes in favour of a more streamlined procedure. He then suggested that institutional rules could include a provision warning parties that in agreeing to those rules, the tribunal is given the full authority to curtail the process to save time and costs, and each party thereby gives up its right to complain.
On the issue of costs, Mr Landau QC raised the idea of having parties state their budget in cost management conferences, with the effect of limiting the costs recoverable at the end of the arbitration. While approving the idea in principle, Prof. Dr. Abdel Wahab commented that the main limitation would be counsels’ resistance to such a proposal. In the final poll of the session, 51% of poll respondents agreed that institutional rules should require early cost management conferences to fix costs in every case.
Conclusion
The call for greater transparency was a recurring theme throughout, undergirding many of the ideas proffered by the esteemed panellists. It remains to be seen whether institutions will adopt the suggestions raised, but it is likely that, contrary to the hopes of the panel, the same issues of delays and costs will continue to be a mainstay in future discussions.
