Court Assistance in the Taking of Evidence in International Arbitration

§ 5Conclusion

After examining the three pillars of the legal framework of international arbitration—namely the leges arbitri, the arbitration agreement and the institutional arbitration rules—several conclusions can be drawn.

The leges arbitri contain the general legislative framework by determining external issues such as the relation between state courts and the arbitral tribunal, as well as internal matters such as the taking of evidence. It has been shown that the parties should choose as the seat of arbitration an arbitrationfriendly country where state courts will not interfere in the arbitral proceedings without good reason, and will also grant support (e.g. assistance in taking evidence or enforcement of the arbitral award). Unsurprisingly, the leges arbitri examined in this chapter are all very arbitration friendly, granting the arbitral tribunal wide discretion to govern the arbitral proceedings as long as due process is respected. Even though the leges arbitri provide a general procedural framework, the taking of evidence is in most cases only briefly mentioned. Thus, the question is where the parties should agree more specifically on evidentiary matters.

The arbitration agreement is crucial, since the validity of the arbitration itself—let alone that of the arbitral award—hinges on its validity. Because of the principle of separability, parties would be well advised to agree on the law governing the arbitration agreement and the underlying contract. In the arbitration agreement itself, the parties usually refer to evidentiary matters indirectly by agreeing on the application of institutional arbitration rules, in which all sorts of evidentiary issues are addressed in more detail. Although the parties can directly agree on the application of, for instance, the IBA Rules in the arbitration agreement, this seldom happens in practice.

An examination of the institutional arbitration rules reveals that, as in the leges arbitri, the arbitral tribunal has vast discretion to choose the procedural rules à la carte. In consultation with the parties, the arbitral tribunal should address matters of evidence at the outset of the proceedings (i.e. at the case management conference). By means of two examples, it has been demonstrated how views on these matters differ among institutional arbitration rules from common law and civil law systems. In this regard, the IBA Rules combine different elements from common law and civil law, and therefore represent an excellent compromise that works well in conjunction with institutional arbitration rules.

From this study of the legal framework, one thing is clear: in arbitration, as perhaps nowhere else, party autonomy is paramount.²⁷³ This is evident in all three pillars of the arbitral procedural framework. Applied to the taking of evidence, the parties are at liberty, according to their intentions, to choose the seat of arbitration, draft the arbitration agreement and agree therein on a suitable set of institutional arbitration rules. In addition, those arbitration rules can be tailored to a high degree to the special needs of the respective case. Thus, compared to state court litigation, the taking of evidence in international arbitration seems to be almost limitless.

Obviously, however, this is true only as long as the parties play by the rules. So what happens if the parties do not comply with evidentiary orders? How can the arbitral tribunal respond? Can it sanction the disobedient party and if so, by what means? The next chapter will focus on the various possibilities the arbitral tribunal has at its disposal in this regard.

Chapter 4: Sanctions of the Arbitral Tribunal

§ 1Introduction

The previous chapter has shown the arbitral tribunal’s broad discretion to order document production and to summon witnesses as it deems appropriate. However, because the tribunal has no coercive power, the effectiveness of such orders depends largely on the parties’ compliance. In this regard, there are several good reasons for parties to comply with evidentiary orders. First, they have an interest in the smooth functioning of the proceedings, in order to obtain an arbitral award within a reasonable timeframe. Second, since it is the arbitral tribunal that will eventually decide on the merits of the case, the parties are usually inclined to follow its procedural orders to keep the arbitral tribunal onside.²⁷⁴ Third, despite the arbitral tribunal’s lack of coercive power, it has some very effective sanctions at hand, which the parties should try their best to avoid.

Inevitably, however, in certain situations it may be impossible to present evidence, due to force majeure or other unforeseen circumstances.²⁷⁵ In addition, the parties might have the right to refuse to comply with evidentiary orders due to (among other things) attorneyclient privilege, technical and/or commercial confidentiality, or loss or destruction of a document.²⁷⁶ However, the arbitral tribunal has various sanctions at its disposal if a party is unable to explain sufficiently why evidence has not been produced or if other obstructionist behaviour is revealed. Otherwise, parties might be able to unduly influence the proceedings by destroying or forging documents,²⁷⁷ by providing false testimony or by improperly influencing witnesses and their statements.²⁷⁸ This chapter outlines several sanctions that the arbitral tribunal — S. 56 —can impose and considers whether they are in fact helpful to effectively gather evidence.²⁷⁹ The focus is on the main sanction—socalled ‘adverse inference’—although cost sanctions, sanctions against party representatives and monetary penalties are also addressed.