Generally speaking, commercial arbitrations which are seated in England and Wales must be conducted as expeditiously as possible. However, as well-intentioned as the tribunal and parties may be, COVID-19 continues to cause much delay in the conduct of international arbitration. Since the pandemic began, legal counsel have been fielding and responding to requests for delay and alterations to the regular procedure of ongoing arbitrations. This post doesn’t seek to express a view on the merits of such applications but attempts to shine a light on the kinds of applications that practitioners are now facing on a day-to-day basis.
Reasons for disruption
Given the unprecedented COVID-19 situation, in appropriate cases, the circumstances below could provide good reasons for requesting a delay:
- Lockdown related disruption. The physical disruption of lockdown has slowed the ability of legal counsel, clients, witnesses and experts to engage in the process of arbitration, which has caused delays.
- Disagreement as to the conduct of a remote hearing. Legal counsel for both parties cannot reach an agreement regarding the logistics of a remote hearing, perhaps due to expense or format.
- Diversion of resources. Clients, experts and witnesses are engaged in urgent COVID-19 related work or personal circumstances and are consequently unable to give as much attention to the arbitral process as they would have under normal circumstances.
- Access to documents. Legal counsel, clients, experts and witnesses are working remotely and key physical documents are located at their place of work, which can only be entered if necessary, thereby causing delays.
- Delay in physical deliveries. Wet ink signatures, physical copies of documents, USBs of key files and other items which require physical delivery have been delayed because of COVID-19 related restrictions on postal services between countries.
The show must go on
While recognising that the COVID-19 situation has caused unprecedented disruptions, it is important that the arbitration process continues as much as possible, taking into account the appropriate adjustments that can be made. Many other industries have made adaptations to normal working practices and it is open to the flexible arbitral process to follow suit. In appropriate cases, the following points and adaptations can be made to minimise disruption:
- The seat. Although not mandatory, the tribunal should be guided by the robust approach to COVID-19 taken by the English judiciary. Although the position varies in different courts, the overall message from the English High Court is “business as usual as far as possible”. This has been backed up by recent case law and court guidance demonstrating that “the show must go on” in the English courts. If national court systems are managing to be flexible and adapt to changing circumstances, tribunals should do likewise.
- The institution. Again, although non-mandatory, it has been the approach of many arbitral institutions to issue guidance to the effect that the parties and tribunal in international commercial arbitrations should do their utmost to make sure that the proceedings continue as planned.
- The individual circumstances of the case. It is good practice for the parties seeking to apply for changes to the procedure or timetable of an arbitration to provide the full context behind how COVID-19 related disruption has had an impact on that party and the direct connection to the changes proposed. This gives the other parties and the tribunal the factual matrix to assess the nature and extent of the obstacles being faced by the applicant, and consider what procedural tools and practical solutions may be available to address those obstacles in the context of the arbitration.
It is important to bear in mind that COVID-19 presents an ever changing picture. Related applications can only be considered on a case-by-case basis, based on the situation known at the time of determining the application. In particular, it will pay dividends to consider the individual circumstances of the case and whether particular mechanisms can be used to minimise disruption. For example, where one witness may no longer be available to attend a hearing, consideration should be given to whether the whole hearing is lost or whether the time set aside for the hearing can be used to hear certain parts of the case, such as the legal submissions or taking evidence from other witnesses, who are able to give evidence, provided that such steps would not unduly prejudice either party. There is a vast toolkit of options available to arbitrators to do justice in the circumstances of each case. The parties and tribunal should not be reticent to take advantage of them.
While parties and the tribunal are generally under an obligation to dispose of an arbitration as expeditiously as possible, tribunals are aware that the pandemic can cause real and significant issues with the conduct of international commercial arbitration. Generally speaking, commercial arbitrations seated in England and Wales must also be conducted in a manner that is fair and which allows each party a reasonable opportunity to present their case. On that basis, resisting a legitimate application unnecessarily wastes time and costs and risks incurring the ire of a reasonable tribunal.
In the context of the COVID-19 pandemic, arbitrators have flexibility to deal with the fact-specific circumstances that can cause delay and, in each case, will consider how justice can best be served. The parties need to recognise this when making an application by setting out the particular facts of the disruption and the proposed solutions, so that the tribunal can properly consider any effect on the procedural timetable.