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WCARTSIXTH ANNUAL ENERGY, MINING AND

RESOURCES ARBITRATION CONFERENCE

Issues of Conflicts and Ethics in International Arbitration

● Murray A. Clemens, Q.C. (Chair), Nathanson, Schachter & Thompson, LLP, Vancouver

● Steven K. Andersen, Esq., Vice President, International Development International Centre for Dispute Resolution, Salt Lake City, Utah

● Murray L. Smith (Chair), LLM Chartered Arbitrator, Smith Barristers, Vancouver

● John A. Terry, Torys, Toronto

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Ethical Questions

1. What ethical issues arise whendealing with the appointment ofthe arbitration tribunal and how dothey differ when using different appointment methodologies?

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ICDR Case Filing Trends

Trends: Global Leader of “INTERNATIONAL” Cases since 20012011 ICDR Cases=994, 2011 ICC Cases= 794,

ICDR Mediations=95, ICDR Webfile = 163

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There were 44 Challenges of Arbitrators in the 994 ICDR 2011 Caseload (about 4%).

– 35 at Appointment Disclosure Stage• 21 Removed (60%)• 14 Reaffirmed (40%)

– 9 at Pre-hearing/Award stage • 2 Removed (20%)• 7 Reaffirmed (80%)

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Ethical Questions in International Arbitration

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CordeliaRegan

King Lear

Goneril

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Arbitrator

Institution

Arbitrator

Arbitrator

Party

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What did the King want to hear or in other words, what do institutions and parties want to have in arbitrator disclosures?

Should the two sisters or party-appointed arbitrators need to clarify their partiality, if any, to the parties in the case?

• What should have Cordelia disclosed to King Lear or to what degree do arbitrators need to disclose information?

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Ethical Questions in International Arbitration

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7. Appoint your Arbitrators

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ClaimantJose Martinez 6John Smith XRicardo Suarez XAntonio San Martin 3James Jones XLinda Cruz 4Charles Brown 10Ramon Gonzales XFrancisco Jimenez 2George Webber 5Esteban Garza 7Barry Lewis 9Mercedes Sala 1Nathaniel Peters XSarah Durham 8

RespondentJose Martinez XJohn Smith 1Ricardo Suarez 10Antonio San Martin 3James Jones XLinda Cruz 2Charles Brown 6Ramon Gonzales XFrancisco Jimenez 5George Webber XEsteban Garza 8Barry Lewis XMercedes Sala 9Nathaniel Peters 4Sarah Durham 7

1st

2nd

3rd

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Ethical Questions

2. What issues arise from a practical

and ethical point of view when a partywishes to interview potential arbitrators before appointment? What are the limits of matters to be discussed and what kind of disclosure should be made followingappointment?

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Ethical Questions

3. An issue which you believe isimportant if not pivotal to theresult is not being addressed bythe parties. Do you raise the point,when and how? If the issue occurs to you after the close of thehearing, what do you do?

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Ethical Questions

4. You have conducted a mediation andthe parties have reached a settlement of a complex dispute. Both parties ask toyou to act as an arbitrator shoulddifferences arise in the implementationof the dispute. What are the ethicaland practical issues. How are theyaddressed?

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5. What resources are available in terms of rules and ethical codes to help reconcile differing practices models around the world?

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Ethical Questions in International Arbitration

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The 1977 Code of Ethics language provided for

disclosures WHICH ARE LIKELY TO AFFECT

IMPARTIALITY OR WHICH MIGHT REASONABLY

CREATE AN APPEARANCE OF PARTIALITY OR

BIAS.

The 2004 Code of Ethics language provides for disclosures WHICH MIGHT REASONABLY AFFECT IMPARTIALITY OR LACK OF INDEPENDENCE IN THE EYES OF ANY OF THE PARTIES.

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Ethical Questions in International Arbitration

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How carefully do parties manageappropriate ex-parte communications withtheir potential party appointed arbitrator?

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Ethical Questions in International Arbitration

1. General nature of the controversy

2. Discuss the candidate’s qualifications

3. Availability to serve without causing delay

4. Independence in relation to the parties

5. Suitability of candidates for presiding arbitrator

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Based upon the Code of Ethics, what sort of commitments should be made by the arbitrators?

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Ethical Questions in International Arbitration

Availability to Serve:

The 2004 revision imposes an obligation on the arbitrator to determine his or her competence and availability to serve in the case.

Duty to:•Public•Parties•Process•Participants (all)•Pro bono

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Ethical Questions

6. Are you qualified to undertake and complete the appointment and are you able (time, availability, health, other) to undertake and complete the arbitration within the required time? We can discuss this issue in terms of what kind of a personal examination should one subject oneself to and to what extent is modesty a virtue.

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Ethical Questions

7. What does one do when parties are represented by counsel with different experience and skill? In this circumstance, how does an arbitrator ensure that the parties involved in an arbitration are fairly informed and have an adequate understanding of the procedural aspects and legal issues? Is there a role for the arbitrator to “even the playing field”?

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Ethical Questions

8. Fees and payment terms. Is there an obligation to give particularized accounts?

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Ethical Questions

9. Do you have a duty to move an arbitration on when the claimant, either advertently or inadvertently is not pressing the matter forward and the respondent is only too happy to stand idle? This is a situation where arbitration is markedly different than litigation. In litigation, the defending party is usually brought into the process against its will, whereas in arbitration the parties have agreed to resolve their disputes in arbitration. This distinction was commented on by the British Columbia Court of

Appeal in a recent decision Premium Brands Operating GP Inc. v. Turner Distribution Systems Ltd., 2011 BCCA 75 http://www.courts.gov.bc.ca/jdb-txt/CA/11/00/2011BCCA0075cor1.htm

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WCARTSIXTH ANNUAL ENERGY, MINING AND

RESOURCES ARBITRATION CONFERENCE

Issues of Conflicts and Ethics in International Arbitration

● Murray A. Clemens, Q.C. (Chair), Nathanson, Schachter & Thompson, LLP, Vancouver

● Steven K. Andersen, Esq., Vice President, International Development International Centre for Dispute Resolution, Salt Lake City, Utah

● Murray L. Smith (Chair), LLM Chartered Arbitrator, Smith Barristers, Vancouver

● John A. Terry, Torys, Toronto

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