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Conflicts of Procedure between Courts and Arbitral Tribunals with Particular Reference to the Right of Access to Court

Document Cited authorities 46 Cited in Related
Vincent
Date01 September 2011
DOI10.3366/ajicl.2011.0012
Published date01 September 2011
Pages236-282
AuthorChrista Roodt
INTRODUCTION

International commercial arbitration has always been an area where different legal traditions tended towards similarities in regard to their regulatory policies, legal processes and judicial theory. Courts play a vital supporting role in relation to arbitration agreements and awards. Nonetheless, unnecessary conflicts between arbitration and judicial adjudication occur often. Tension develops between fairness, arbitral autonomy and party autonomy; or when the fairness implicit in the balance between adjudicatory fora competes with the fairness associated with a constitutional rights perspective that guards access to court. Commercial confidence is marred whenever this tension remains unresolved. Jurisdictions that have tackled the issues associated with the priority and exclusivity in conflicts of jurisdiction between courts and arbitral tribunals along the model provisions found in the UNCITRAL Model Law on International Commercial Arbitration1

The United Nations Commission on International Trade Law (UNCITRAL) adopted the 1985 Model Law on International Commercial Arbitration on 21 June 1985. United Nations documents A/40/17, annex I. Significant amendments were effected in 2006 (UNCITRAL's report on the work of its 39th session (UN Doc. A/61/17 Annex I)).

seem to be doing fine. In the European Union, various efforts have been made to improve the interface between curial and extra-curial proceedings. However, none of the reform proposals promise lasting solutions. In several other jurisdictions such as South Africa, various interests have fallen into disharmony in this area of the law. McLachlan has envisioned2

C. McLachlan, Lis Pendens in International Litigation, Hague Academy of International Law (2009), p. 89.

 a ‘new science of conflict of litigation’ to better manage such conflicts

Whereas party autonomy and arbitral autonomy encourage stability in dispute resolution, court intervention could lead to delays, tactical manoeuvring and inefficiency. There is much to gain from an agreement lending arbitrators the final authority to rule on their competence, the chance to do so first, and excluding a review of the arbitral award on the merits. Nonetheless, legal systems may pursue policies of judicial centralisation of the review of arbitral awards.

The quest for balance between arbitral autonomy and the powers of national courts gives rise to both practical and conceptual difficulties. Moreover, while the litigants may have chosen in favour of the enforcement of arbitral authority, at the crucial junctures (that is, referral or application for interim relief, enforcement of the arbitral award or setting aside the award), this autonomy may be denied or endorsed by the court in question. Both party autonomy and arbitral autonomy may be denied in order to safeguard procedural due process and a basic respect on the part of the arbitrator for the interests of those involved.3

N. Blackaby and C. Partasides, Redfern and Hunter on International Arbitration, 5th edn, OUP (2009), §§ 7.04–7.05.

The simple idea of maximising court support and curbing court interference that stifles – or disrupts – arbitration is intended to strike a balance between the interests.4

Explanatory Note on the 1985 Model Law on International Commercial Arbitration as amended in 2006; C. Reymond, ‘The Channel Tunnel Case and the Law of International Arbitration’, 109 LQR (1993): 337–41, at 341.

Curbing court intervention is justified with reference to legal certainty, the public interest, commercial realities, business expectations, basic fairness or even the concept of arbitrability.5

With reference to public interest and basic fairness, see for example Department of Economics Policy and Development of the City of Moscow v Bankers Trust Co [2005] QB 207, at § [31]. With reference to ‘arbitrability’, see for example Howsam v Dean Witter Reynolds Inc, 537 US 79 § II (2002). The term denotes the ‘jurisdictional question’ of whether an arbitral tribunal has jurisdiction over a case in the US. Whereas substantive arbitrability relates to the subject matter of the dispute, procedural arbitrability implies that the arbitration agreement suffers from a procedural deficiency that renders the agreement and the award invalid.

 Different principles and standards of non-intervention are found in domestic laws and in model legislation.6

Examples include article 16 of the UNCITRAL Model Law on International Commercial Arbitration (which represents a near complete regulation of the tension between protecting arbitration from obstruction and preserving the right to have access to court in legitimate disputes over arbitrator jurisdiction), and section 1 of the English Arbitration Act 1996 (which provides that the court shall not intervene except as provided for in Part I). See P. Shine, ‘Establishing Jurisdiction in Commercial Disputes: Arbitral Autonomy and the Principle of Kompetenz-Kompetenz’, 3 JBL (2008): 202–25, at 204.

 The standard of the support given to the arbitral process differs across these examples.7

Compare judicial policy in the US and France (discussed in the text accompanying n. 54–60). C. Pamboukis, ‘On Arbitrability: The Arbitrator as a Problem Solver’, in L. A. Mistelis and S. L. Brekoulakis (eds), Arbitrability: International and Comparative Perspectives, Kluwer Law (2009), pp. 121–41, at §§ 7.2, 7.53, 7.58, 7.62; T. E. Carbonneau, ‘Judicial Approbation in Building the Civilization of Arbitration’, 113(4) Penn State Law Review (2009): 1343–65, at 1358, 1361–3.

This article provides a comparative assessment of the balance of power on the part of national courts and arbitral tribunals with reference to recent developments in the EU and South Africa. This analysis takes due notice of the position and status of compétence-compétence, lis pendens and res judicata, and argues that law reform will be fruitless until such time as these basic doctrines are accorded minimum respect. Compétence-compétence is perhaps the most sensitive to the context in which it operates8

W. W. Park, ‘The Arbitrator's Jurisdiction to Determine Jurisdiction’, 13 ICCA Congress Series 55 (2006): 1–156, at 4.

but all three depend heavily on their national and institutional background. At a fundamental level, this article reveals how vital the basic thrust of the doctrine of compétence-compétence is to helping prevent court interference in arbitral proceedings. If the compétence-compétence doctrine is permitted to do so, it is able to effectively reduce the opportunities to frustrate the arbitration.9

International Law Association, Toronto Conference (June 2006), Final Report on Lis Pendens and Arbitration, available at http://www.ila-hq.org/en/committees/index.cfm/cid/19, at § 1.10.

The key role of the doctrine of compétence-compétence is not conceded by all.10

For example, J. J. Barceló III, ‘Who Decides the Arbitrators’ Jurisdiction? Separability and Competence-Competence in Transnational Perspective’, 36 VanderBilt Journal of Transnational Law (2003): 1115–36, at 1123.

Several of those who recognise the significance of its role note a paradigm shift in several jurisdictions.11

F. G. De Cossío, ‘The Compétence-Compétence Principle, Revisited’, Journal of International Arbitration (2007): 231–48, at 231. Park, supra note 8, p. 4; C. H. Petrus, ‘Spanish Perspectives on the Doctrines of Kompetenz-Kompetenz and Separability: A Comparative Analysis of Spain's 1988 Arbitration Act’, 11 American Review of International Arbitration (2000): 396–427, at 399.

 Paradigm shift or not, its subtle effect is easily trammelled. If waiver of the right of access to court or certain grounds for review and res judicata are to remain meaningful, the key role of the doctrine of compétence-compétence needs to be acknowledged and an improved understanding of the many different manifestations must be cultivated. Ascribing to a uniform content or legislating on the assumption of a single uniform manifestation of the doctrine is not the best way of restoring its essence

Attention is drawn in Part II to the contexts in which the doctrine of compétence-compétence operates in the EU and in South Africa. Part II takes a closer look at the theory and practice of basic doctrines. Part III investigates how they will function in the recast EU arbitration framework in the light of constitutional or quasi-constitutional safeguards and their effect on waiver. Part IV outlines the leading case law in South Africa with reference to the mechanisms by which conflicts of jurisdiction can be managed. The mechanisms in point are parallel or concurrent consideration; sequential consideration (the prior temporis device), waiver and time bars.12

McLachlan, supra note 2, pp. 198–203.

Part V evaluates these jurisprudential perspectives and the implications of the recast framework under consideration in the EU CONTEXT Europe

The EU responded well to the need to develop a regional system by which to regulate jurisdiction and the free circulation of judgments. It has been less successful with regard to introducing a European Convention that would cater for arbitration.13

European Convention providing a Uniform Law on Arbitration, done at Strasbourg, 20 January 1966, European Treaty Series No. 56. Only Austria and Belgium signed.

The interface between curial and extra-curial proceedings was not particularly well thought through in the 1968 Brussels Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters. The Brussels I Regulation (EU Regulation 44/2001)14

EU Regulation 44/2001 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters OJ 2001 L12/1.

 declares in article 71 that it is not intended to affect any convention of which member states are parties (for example, the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (NYC)15

Concluded 10 June 1958; 9 USCA §§ 201–8.

)....

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