In part III(1), we shared select nuggets for arbitrators. In this article, we conclude with a deeper dive into disclosure and confidentiality for arbitrators. Those that elect arbitration as their dispute resolution mechanism will be concerned that their umpire is truly neutral but further, that the sanctity and confidential nature of the process and outcome would be maintained and upheld. This creates corresponding duties in the arbitrator or arbitral tribunal to ensure that any circumstances that may even suggest that there would exist partiality are addressed squarely. To fail to do so would both undermine the process as well as invalidate the outcome i.e. the Award. These concluding reflections below are in furtherance of this end.??
- Firstly, the arbitrator must disclose any circumstances likely to give rise to justifiable doubts regarding their impartiality or independence. The arbitrator must be aware that the parties to a dispute will be concerned that the chosen arbiter of their dispute is free of bias and that they hold neither vested nor conflicting interest in the process or it's outcome. The burden of providing parties with this assurance is on the arbitrator. The UNCITRAL Rules state that ‘When a person is approached in connection with his or her possible appointment as an arbitrator, he or she shall disclose any circumstances likely to give rise to justifiable doubts as to his or her impartiality or independence. An arbitrator, from the time of his or her appointment and throughout the arbitral proceedings, shall without delay disclose any such circumstances to the parties and the other arbitrators unless they have already been informed by him or her of these circumstances.’??
The AAA Code provides the following guidance:
Persons who are requested to serve as arbitrators should, before accepting, disclose:?
- (1) any known direct or indirect financial or personal interest in the outcome of the arbitration;?
- (2) any known existing or past financial, business, professional or personal relationships which might reasonably affect impartiality or lack of independence in the eyes of any of the parties. For example, prospective arbitrators should disclose any such relationships which they personally have with any party or its lawyer, with any co-arbitrator, or with any individual whom they have been told will be a witness. They should also disclose any such relationships involving their families or household members or their current employers, partners, or professional or business associates that can be ascertained by reasonable efforts;?
- (3) the nature and extent of any prior knowledge they may have of the dispute; and
- (4) any other matters, relationships, or interests which they are obligated to disclose by the agreement of the parties, the rules or practices of an institution, or applicable law regulating arbitrator disclosure.' The arbitrator must give due consideration and introspection in this regard.
The CIARB Code of Professional and Ethical Conduct of members provides that, ?Both before and throughout the dispute resolution process, a member shall disclose all interests, relationships and matters likely to affect the member’s independence or impartiality or which might reasonably be perceived as likely to do so. Where a member is or becomes aware that he or she is incapable of maintaining the required degree of independence or impartiality, the member shall promptly take such steps as may be required in the circumstances, which may include resignation or withdrawal from the process.
- The circumstances, timing and extent of the disclosure may depend on several factors. However, it is generally prudent to make as exhaustive disclosure as possible to the parties as may be required by the parties, the applicable rules and very importantly, one’s own knowledge and conscience. Parties may require specific disclosures and may request this at such point in the proceedings as may be required. There are instances were disclosure has been requested after the delivery of the Award. In Grupo Unidos por el Canal SA v. Autoridad del Canal de Panamá the U.S. Court of Appeals for the Eleventh Circuit affirmed the decision of the U.S. District Court for the Southern District of Florida, refusing to vacate an International Chamber of Commerce (ICC) arbitral award against Grupo Unidos under Chapter 1 of the Federal Arbitration Act, and instead confirming it under Article V of the New York Convention. Grupo Unidos had claimed that the arbitrators who awarded a net sum of $238 million to the Panama Canal Authority were fatally conflicted on account of their professional familiarity and unrelated arbitral assignments with one another and with the parties' counsel. The court relied in part on the conclusion of the International Court of Arbitration of the ICC that, while some of the challenged arbitrator relationships should have been disclosed to the parties beforehand, none of them provided a basis to invalidate the award given the absence of potential or actual bias.
- Confidentiality and privacy: Privacy is not allowing third parties to participate in the arbitration proceedings, whereas, confidentiality is the obligation on the parties to not disclose any information about the arbitration proceedings to any third party. The two concepts are interrelated. The arbitrator must exercise themselves appropriately as regards both.?
- Finally, treat the parties equally and give them an opportunity to present their best case. The Model Law provides that ‘The parties shall be treated with equality and shall be given a full opportunity of presenting his case’. The UNCITRAL Rules provide that ‘Subject to these Rules, the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate, provided that the parties are treated with equality and that at an appropriate stage of the proceedings each party is given a reasonable opportunity of presenting its case.’
The arbitrator must seek to guard and preserve the process and out come of arbitration by disclosing any circumstances likely to give rise to justifiable doubts regarding their impartiality or independence. The arbitrator must make as exhaustive disclosure as possible as soon as possible with clear regard to the dictates of any applicable procedure, law or the requests of the parties. Remember to listen to your own conscience too: if you think about it, disclose it. Have regard to the confidentiality of the proceedings and ensure that only parties to the arbitration agreement are privy to the proceedings. Finally, treat all parties with equality and afford them equal opportunity to present their case. The arbitrator is a proponent and implementor of the rule of law. Arbitrators facilitate access to justice. The role must accordingly be undertaken with all the due consideration it requires and deserves.?
About the author: Kaumbu Mwondela, LLB, LLM, AHCZ, FCIARB is a legal practitioner and international arbitrator. He is qualified at the Zambian bar and is a member of various professional bodies and organisations.
This article is for general information purposes and is not intended to be and should not be taken as legal advice.
