Arbitration (Scotland) Act 2010

JurisdictionScotland
Citation2010 asp 1


Arbitration (Scotland) Act 2010

2010 asp 1

The Bill for this Act of the Scottish Parliament was passed by the Parliament on 18th November 2009 and received Royal Assent on 5th January 2010

An Act of the Scottish Parliament to make provision about arbitration.

Introductory

Introductory

S-1 Founding principles

1 Founding principles

The founding principles of this Act are-

(a) that the object of arbitration is to resolve disputes fairly, impartially and without unnecessary delay or expense,

(b) that parties should be free to agree how to resolve disputes subject only to such safeguards as are necessary in the public interest,

(c) that the court should not intervene in an arbitration except as provided by this Act.

Anyone construing this Act must have regard to the founding principles when doing so.

S-2 Key terms

2 Key terms

(1) In this Act, unless the contrary intention appears-

"arbitration" includes- (a) domestic arbitration, (b) arbitration between parties residing, or carrying on business, anywhere in the United Kingdom, and (c) international arbitration,

"arbitrator" means a sole arbitrator or a member of a tribunal,

"dispute" includes- (a) any refusal to accept a claim, and (b) any other difference (whether contractual or not),

"party" means a party to an arbitration,

"rules" means the Scottish Arbitration Rules (see section 7), and

"tribunal" means a sole arbitrator or panel of arbitrators.

(2) References in this Act to "an arbitration", "the arbitration" or "arbitrations" are references to a particular arbitration process or, as the case may be, to particular arbitration processes.

(3) References in this Act to a tribunal conducting an arbitration are references to the tribunal doing anything in relation to the arbitration, including-

(a) making a decision about procedure or evidence, and

(b) making an award.

S-3 Seat of arbitration

3 Seat of arbitration

(1) An arbitration is "seated in Scotland" if-

(a) Scotland is designated as the juridical seat of the arbitration-

(i) by the parties,

(ii) by any third party to whom the parties give power to so designate, or

(iii) where the parties fail to designate or so authorise a third party, by the tribunal, or

(b) in the absence of any such designation, the court determines that Scotland is to be the juridical seat of the arbitration.

(2) The fact that an arbitration is seated in Scotland does not affect the substantive law to be used to decide the dispute.

Arbitration agreements

Arbitration agreements

S-4 Arbitration agreement

4 Arbitration agreement

An "arbitration agreement" is an agreement to submit a present or future dispute to arbitration (including any agreement which provides for arbitration in accordance with arbitration provisions contained in a separate document).

S-5 Separability

5 Separability

(1) An arbitration agreement which forms (or was intended to form) part only of an agreement is to be treated as a distinct agreement.

(2) An arbitration agreement is not void, voidable or otherwise unenforceable only because the agreement of which it forms part is void, voidable or otherwise unenforceable.

(3) A dispute about the validity of an agreement which includes an arbitration agreement may be arbitrated in accordance with that arbitration agreement.

S-6 Law governing arbitration agreement

6 Law governing arbitration agreement

Where-

(a) the parties to an arbitration agreement agree that an arbitration under that agreement is to be seated in Scotland, but

(b) the arbitration agreement does not specify the law which is to govern it,

then, unless the parties otherwise agree, the arbitration agreement is to be governed by Scots law.

Scottish Arbitration Rules

Scottish Arbitration Rules

S-7 Scottish Arbitration Rules

7 Scottish Arbitration Rules

The Scottish Arbitration Rules set out in schedule 1 are to govern every arbitration seated in Scotland (unless, in the case of a default rule, the parties otherwise agree).

S-8 Mandatory rules

8 Mandatory rules

The following rules, called "mandatory rules", cannot be modified or disapplied (by an arbitration agreement, by any other agreement between the parties or by any other means) in relation to any arbitration seated in Scotland-

rule 3 (arbitrator to be an individual)

rule 4 (eligibility to act as an arbitrator)

rule 7 (failure of appointment procedure)

rule 8 (duty to disclose any conflict of interests)

rules 12 to 16 (removal or resignation of arbitrator or dismissal of tribunal)

rules 19 to 21 and 23 (jurisdiction of tribunal)

rules 24 and 25 (general duties of tribunal and parties)

rule 42 (point of law referral: procedure etc.)

rule 44 (time limit variation: procedure etc.)

rule 45 (securing attendance of witnesses and disclosure of evidence)

rule 48 (power to award payment and damages)

rule 50 (interest)

rule 54 (part awards)

rule 56 (power to withhold award if fees or expenses not paid)

rule 60 (arbitrators' fees and expenses)

rule 63 (ban on pre-dispute agreements about liability for arbitration expenses)

rules 67, 68, 70, 71 and 72 (challenging awards)

rules 73 to 75 (immunity)

rule 76 (loss of right to object)

rule 77 (independence of arbitrator)

rule 79 (death of arbitrator)

rule 82 (rules applicable to umpires)

S-9 Default rules

9 Default rules

(1) The non-mandatory rules are called the "default rules".

(2) A default rule applies in relation to an arbitration seated in Scotland only in so far as the parties have not agreed to modify or disapply that rule (or any part of it) in relation to that arbitration.

(3) Parties may so agree-

(a) in the arbitration agreement, or

(b) by any other means at any time before or after the arbitration begins.

(4) Parties are to be treated as having agreed to modify or disapply a default rule-

(a) if or to the extent that the rule is inconsistent with or disapplied by-

(i) the arbitration agreement,

(ii) any arbitration rules or other document (for example, the UNCITRAL Model Law, the UNCITRAL Arbitration Rules or other institutional rules) which the parties agree are to govern the arbitration, or

(iii) anything done with the agreement of the parties, or

(b) if they choose a law other than Scots law as the applicable law in respect of the rule's subject matter.

This subsection does not affect the generality of subsections (2) and (3).

Suspension of legal proceedings

Suspension of legal proceedings

S-10 Suspension of legal proceedings

10 Suspension of legal proceedings

(1) The court must, on an application by a party to legal proceedings concerning any matter under dispute, sist those proceedings in so far as they concern that matter if-

(a) an arbitration agreement provides that a dispute on the matter is to be resolved by arbitration (immediately or after the exhaustion of other dispute resolution procedures),

(b) the applicant is a party to the arbitration agreement (or is claiming through or under such a party),

(c) notice of the application has been given to the other parties to the legal proceedings,

(d) the applicant has not-

(i) taken any step in the legal proceedings to answer any substantive claim against the applicant, or

(ii) otherwise acted since bringing the legal proceedings in a manner indicating a desire to have the dispute resolved by the legal proceedings rather than by arbitration, and

(e) nothing has caused the court to be satisfied that the arbitration agreement concerned is void, inoperative or incapable of being performed.

(2) Any provision in an arbitration agreement which prevents the bringing of the legal proceedings is void in relation to any proceedings which the court refuses to sist.

This subsection does not apply to statutory arbitrations.

(3) This section applies regardless of whether the arbitration concerned is to be seated in Scotland.

Enforcing and challenging arbitral awards etc.

Enforcing and challenging arbitral awards etc.

S-11 Arbitral award to be final and binding on parties

11 Arbitral award to be final and binding on parties

(1) A tribunal's award is final and binding on the parties and any person claiming through or under them (but does not of itself bind any third party).

(2) In particular, an award ordering the rectification or reduction of a deed or other document is of no effect in so far as it would adversely affect the interests of any third party acting in good faith.

(3) This section does not affect the right of any person to challenge the award-

(a) under Part 8 of the Scottish Arbitration Rules, or

(b) by any available arbitral process of appeal or review.

(4) This section does not apply in relation to a provisional award (see rule 53), such an award not being final and being binding only-

(a) to the extent specified in the award, or

(b) until it is superseded by a subsequent award.

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