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Arbitration Clause in the Agreement: Jurisdiction and Disclosure and Bias

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Added on  2023/04/26

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This document discusses the jurisdiction and disclosure and bias in the arbitration clause in the agreement. It also explains the compliance with Article 11(2 and 3) of the ICC rules of Arbitration as well as UNCITRAL Model Law 2006.

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Student’s Name
Regitration Number
Institution
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Table of Cases
Korsnas Aktiebolag v. AB Fortum Varme [2010]
List of Abbreviations.
ICC-International Chamber of Commerce
UNCITRAL-United Nations Commission on International Trade Law.
IBA-International Bar Association
List of Statutes
ICC rules of Arbitration
UNCITRAL Model Law 2006
IBA guidelines on conflict of interest Arbitration
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Jurisdiction.
The Jurisdiction of this tribunal is granted by the Arbitration Clause in the Agreement. Clause
100 of the Agreement states that; “All disputes arising directly from the terms of this contract
to be resolved judicially by an expert from London under ICC.” The parties to the Arbitration
have not made it clear as to whether they would want to be governed by arbitration rules as set
out by the International Bar Association. The effect would be that the said rules are used for
purposes of these proceedings unless either party raises an objection towards the same. However,
all other rules of Arbitration will apply to the extent that they are applicable to these proceedings.
However, I will also rely on the ICC rules of Arbitration.
Disclosure and Bias.
To begin with, I will start by complying with Article 11(2 and 3) of the ICC rules of Arbitration
as well as UNCITRAL Model Law 20061 which require that an Arbitrator must disclose any
information that may lead to doubts as to their impartiality or independence before the eyes of
the parties.2 The information is as follows;
1. I own 2% of the shareholding of a company which was, until three years ago, a major
supplier to the Claimant.
2. I am a keen motorcyclist.
3. Three years prior to being contacted in connection with the case, I was treated at the
same hospital in Istanbul at which the operation was carried out on Aiden O’Reilley.
4. Six months ago, I was included in a list of possible arbitrators by the Respondent in a
claim in which it was pursuing a building company for alleged shoddy building works
at its Australian headquarters. I was however not selected.
I will consider each issue as stated above as follows:
1. Owning 2% shares in a company which was until 3 years ago a major supplier to the
claimant.
1 UNCITRAL Model Law 2006 ‘Grounds for Challenge’
https://www.jus.uio.no/lm/un.arbitration.model.law.1985/12.html (accessed on 08/02/2019)
2 ICC Arbitration rules https://cdn.iccwbo.org/content/uploads/sites/3/2017/01/ICC-2017-Arbitration-and-
2014-Mediation-Rules-english-version.pdf.pdf (accessed on 08/02/2019)
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In determining this issue, I will rely on the IBA guidelines on conflict of interest Arbitration3. In
the guidelines, there is what is termed as a ‘Red List’ which list is further split into ‘Waivable
red list and a Non- Waivable red list.’4 Issues in the waivable red list are those that are serious in
nature but not severe. This is to mean that the arbitrator can be allowed to continue only after the
party expressing fears of bias allows such an arbitrator to proceed. The Defendant is thus allowed
to make a decision as to whether they are satisfied with me proceeding or otherwise in which
case, I will disqualify myself.
Finally on this matter, there is what has been referred to as ‘a reasonable third person test’5
which is speculative in nature as to what a person with full facts of the case would say on the
competence of an arbitrator. It is my view that ‘a reasonable third person’ might consider the
stake I hold in the company and view it as insignificant as to affect my reasoning. The time
frame might also be considered and in my view, it is long enough as to warrant my competence
in this matter.
However, I will leave the decision entirely to the parties.
2. I am a keen motorcyclist.
I would use the reasonable third party test to decide on this matter. It is expected that everyone
using a motorcycle is a keen motorcyclist. In addition, no party in these proceedings is directly
affected by keen motorcycling. The use of helmets in my opinion does not guarantee that one is a
keen motorcyclist. It is more of a cautionary measure as well as a fulfillment of traffic rules.
Therefore, on the face of it this claim cannot affect my impartiality or neutrality as an arbitrator.
3. Three years prior to being contacted in connection with the case, I was treated at the same
hospital in Istanbul at which the operation was carried out on Aiden O’Reilley.
On this issue, there is clearly no imminent conflict of interest since the hospital is not party to
this proceedings and it cannot be affected in any way by the decisions made herein. In addition,
3 IBA guidelines on conflict of interest https://www.ibanet.org/Document/Default.aspx?
DocumentUid=e2fe5e72-eb14-4bba-b10d-d33dafee8918 (accessed on 08/02/2019)
4 Herbert Smith Freehills ‘Non-Waivable Red List’ https://hsfnotes.com/arbitration/tag/non-waivable-red-
list/ (accessed on 08/02/2019)
5 'The Reasonable Person' (TheFreeDictionary.com, 2019) <https://legal-
dictionary.thefreedicti656685onary.com/The+Reasonable+Person> accessed 9 February 2019.
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there is no special relationship either directly or indirectly between me and the hospital or its
workers. From the foregoing, it is clear that there is no threat of impartiality or competence as an
arbitrator to this matter.
4. Six months ago, I was included in a list of possible arbitrators by the Respondent in a claim
in which it was pursuing a building company for alleged shoddy building works at its
Australian headquarters. I was however not selected.
This matter, in my opinion, is waivable. Its ability to affect the independence or impartiality of
an arbitrator is subject to acceptance or refusal by either party. An objection by either party
means that I will not continue presiding over these proceedings. In addition, in the matter of
Korsnas Aktiebolag v. AB Fortum Varme,6 the court refused to set aside an arbitral award after
one party alleged that one of the arbitrators had previous dealings with one of the parties. In view
of this however, I will leave the matter to the parties.
6 Thomas Reuters Practical Law ‘Swedish Supreme considers the issue of repeat appointments’
https://uk.practicallaw.thomsonreuters.com/9-502-6689? (accessed on 08/02/2019)
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References
UNCITRAL Model Law 2006 ‘Grounds for Challenge’
>https://www.jus.uio.no/lm/un.arbitration.model.law.1985/12.html> accessed on 08/02/2019
ICC Arbitration rules> https://cdn.iccwbo.org/content/uploads/sites/3/2017/01/ICC-2017-
Arbitration-and-2014-Mediation-Rules-english-version.pdf.pdf> accessed on 08/02/2019
IBA guidelines on conflict of interest >https://www.ibanet.org/Document/Default.aspx?
DocumentUid=e2fe5e72-eb14-4bba-b10d-d33dafee8918> accessed on 08/02/2019
Herbert Smith Freehills ‘Non-Waivable Red List’> https://hsfnotes.com/arbitration/tag/non-
waivable-red-list/> accessed 08/02/2019
'The Reasonable Person' (TheFreeDictionary.com, 2019) <https://legal-
dictionary.thefreedictionary.com/The+Reasonable+Person> accessed 9 February 2019
Thomas Reuters Practical Law ‘Swedish Supreme considers the issue of repeat appointments’
>https://uk.practicallaw.thomsonreuters.com/9-502-6689?> accessed 08/02/2019
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