Chapter 14: Remedies for delay

14.1 Delay is generally perceived to be a menace in arbitration. It is contrary to the intended purpose of arbitration, namely speedy and efficient dispute resolution. Delay makes the arbitral process more expensive and can compromise documentary and witness evidence.

14.2 Delay can arise at every stage of an arbitration, the usual causes being a lack of will or resources to progress the arbitration, a deliberate tactical preference for allowing time to lapse, lack of authority to settle or pursue the matter, or difficulties in gathering evidence. The competing commitments of members of the tribunal can also cause delays in dealing with procedural matters, fixing hearings or producing awards.

14.3 Dealing with delays in arbitration was one of the specific objectives of the 1996 Act: as the DAC stated, the avoidance of unnecessary delay in arbitration is a fundamental aspect of justice and, as such, a necessary requirement of a dispute resolution system which is based upon obtaining a binding decision from a third party. 1 The provisions of the 1996 Act seek to prevent delays from arising (by placing parallel duties on the parties and on the tribunal to progress the arbitration with expedition) and also to provide remedies when delays do occur. In the context of LMAA arbitrations, there are also contractual provisions (governing timetabling, peremptory orders and the like) which aim to minimise delays. This chapter will seek to examine those provisions (both statutory and contractual) that are relevant in maritime arbitration.

14.4 The arbitration agreement, or more commonly any applicable arbitration rules, may include provisions designed to address the problem of delay. Usually such terms are designed to prevent delays from arising at all. Where it is known at the outset that an early hearing is essential, the LMAA Terms require the parties to consult and ensure the availability of the arbitrator(s) to be appointed by them. Furthermore, where it becomes impossible to fix an acceptable hearing date, the LMAA Terms contemplate reconstitution of the tribunal. 2

14.5 Schedule 2 of the LMAA Terms sets out a fairly brisk timetable, to be adhered to by the parties unless the tribunal orders otherwise. Schedule 2 also includes provisions specifically aimed at minimising delays. Supporting documents relevant to the issues between the parties are in most cases to be served with written submissions. Unless it is agreed that the arbitration will proceed on the basis of the written submissions only, the parties must submit signed questionnaires, setting out the nature of the dispute and the necessary evidence. 3 After the exchange of questionnaires, the tribunal will generally allow the parties 21 days in which to agree the future procedural course, or to make submissions to the tribunal if agreement cannot be reached. 4 An allegation that the claimant has failed to disclose all supporting documents will not normally justify a delay in service of defence submissions (paragraph 2). Similarly, Schedule 2 provides for written witness statements to stand as evidence in chief (paragraph 12) and expressly requires all communications regarding procedural matters to be made expeditiously (paragraph 14). These provisions may be backed by peremptory orders (pursuant to the powers conferred by the 1996 Act) in appropriate cases, and are discussed in detail in chapter 12.

14.6 Apart from the provisions of the LMAA Terms, it is relatively rare for the parties to agree express provisions conferring specific powers upon the tribunal entitling it, for example, to dismiss a claim in the event of delay. The tribunal’s powers in this respect will, in most arbitral proceedings, derive from the supportive provisions of the 1996 Act rather than from expressly negotiated terms in the arbitration agreement. 5

14.11 Section 41(3) of the 1996 Act provides that:

If the tribunal is satisfied that there has been inordinate and inexcusable delay on the part of the claimant in pursuing his claim and that the delay –

1. gives rise, or is likely to give rise, to a substantial risk that it is not possible to have a fair resolution of the issues in that claim, or

2. has caused, or is likely to cause, serious prejudice to the respondent,

14.12 Section 41(3) replicates, in almost identical terms, the provisions previously contained in section 13A of the Arbitration Act 1950, itself introduced by way of amendment to the 1950 Act in 1992. Section 13A of the 1950 Act was intended to replicate the inherent power of the High Court to dismiss a claim for “want of prosecution”. It was intended that the power conferred on the tribunal should be applied and interpreted in the same way as the power of the High Court. This was clear both from the wording of the provision (which adopted the phraseology used in the leading cases on the court’s power to dismiss claims) 13 and section 13A(3), which specifically conferred power on the Secretary of State to amend section 13A by way of statutory instrument “for the purpose of keeping the provision made by this section and the corresponding provision which applies in relation to proceedings in the High Court in step”. The clear intention, at the time section 13A was introduced, was for the power of arbitral tribunals to replicate the power of the High Court.

14.13 However, matters have moved on since 1992. In particular, one effect of the introduction of the Civil Procedure Rules (“CPR”) in High Court proceedings was to do away with the old power to dismiss for want of prosecution, and to replace it with a different, more flexible, power to deal with delays or breaches of procedural orders. Following the introduction of the CPR, and the subsequent “Jackson reforms” introduced in 2013 to improve the speed and efficiency of litigation...