Introduction

1. Arbitration is now the first choice option for the binding resolution of commercial disputes in the widest range of contractual relationships and across many jurisdictions.

2. Arbitration that is administered by an institution can be significantly more efficient, expeditious and cost effective than ad hoc arbitration, provided the parties and the arbitrators understand and adopt the best practices inherent in the institution’s rules and procedures.

3. The purpose of this note is to provide guidance to arbitrators conducting arbitrations in accordance with the LCIA India Rules, though it must be stressed that it neither supplants nor interprets those Rules, being principally concerned with issues of independence, impartiality and confidentiality, and with the effective management of time and costs in accordance with the arbitrator’s duty as set out at Article 14 of the LCIA India Rules, as follows.

“The Arbitral Tribunal has a duty at all times:

(i) to act fairly and impartially as between all parties, giving each a reasonable opportunity of putting its case and dealing with that of its opponent; and

(ii) to adopt procedures suitable to the circumstances of the arbitration, avoiding unnecessary delay or expense, so as to provide an efficient means for the final resolution of the parties’ dispute.”

4. This note is by no means intended to provide an exhaustive list of “best practices” in the conduct of arbitration, but does highlight the broad principles by which tribunals should be guided in the conduct of arbitral proceedings.

Independence and Impartiality

Accepting appointment

5. Parties to international arbitrations are entitled to expect of the process, a just, well reasoned and enforceable award. To that end, they are entitled to expect arbitrators to disclose possible conflicts of interest at the outset; to avoid putting themselves in the position where conflicts will arise during the course of the proceedings; to conduct the arbitration fairly, in a timely manner and with careful regard to due process; to maintain the confidentiality of the arbitration; and to reach their decision in an impartial manner.

6. Under Article 5.3 of the LCIA India Rules, all arbitrators will, before appointment, be required to sign a declaration that there are no circumstances known to them likely to give rise to any justified doubts as to their impartiality or independence.

7. In completing their statements of independence, arbitrators will take into account, inter alia, the existence and nature of any past or present
relationships, direct or indirect, with any of the parties or their counsel; any doubt as to which must be resolved in favour of disclosure.

8. There is a continuing obligation on all arbitrators immediately to disclose any circumstances that might give rise to conflicts, if such circumstances arise at any time during the course of the arbitration.

Communications

9. All communications between the tribunal and the parties must be copied to the LCIA India secretariat.

10. No arbitrator is permitted, during the course of the arbitration, to make any unilateral communication with any party or with any party’s representative.

11. If an arbitrator who has been nominated by a party wishes to communicate with that party before the tribunal has been formally constituted, he must do so through the LCIA India Registrar, in accordance with Article 13.1 of the LCIA India Rules.

Availability

12. It is, of course, essential that an arbitrator should not only be impartial and independent of the parties, but that his diary commitments should permit him to undertake and to fulfil his mandate without delay.

13. Before appointment, therefore, all arbitrators will also be required to confirm their ability to devote sufficient time to the proceedings, over an appropriate timeframe, including drafting the Award.

Confidentiality

14. Article 30 of the LCIA India Rules imposes duties of confidentiality on parties and arbitrators, with which arbitrators should familiarise themselves, and with which the tribunal should ensure that it and the parties comply.

Conduct of the Arbitration

The procedural timetable

15. Although the LCIA India Rules provide, at Article 15, a default timetable for the submission of key written statements and documents, Article 14.3 of the Rules encourages the parties to agree on the conduct of the proceedings and either to do so in writing or to have such agreement recorded by the tribunal in writing.

16. The tribunal should, therefore, consider whether it would be beneficial to hold an early procedural conference with the parties, whether in person or by telephone or video conference, with a view to agreeing a timetable for the proceedings, or if it cannot be agreed, to setting such a timetable, which should be realistic and reasonable both to the parties and to the tribunal.

Meetings and hearings

17. Article 16 of the LCIA India Rules provides that meetings and hearings need not be held at the seat or legal place of the arbitration.

18. With a view to saving time and costs, therefore, the tribunal should, in consultation with the parties, hold hearings at the location which is most convenient for all concerned, whether parties, witnesses or the arbitrators themselves.

19. The tribunal and the parties should also carefully consider a realistic schedule and timeframe for hearings, so as to avoid the need for rescheduling, and to avoid the imposition of cancellation charges in the event of late postponement; and the tribunal should only adjourn a hearing where there is good reason for doing so.

20. The tribunal should make every reasonable effort to hold hearings on consecutive days, rather than in separate periods. A hearing day will normally be expected to cover about 8 hours.

21. The tribunal should also consider, where appropriate, whether some or all of those who must attend any meeting or hearing might do so by video conference, rather than in person.

22. Consideration should also be given to whether the nature and circumstances of the claim and any counterclaim are such that they may be decided on the documents alone.

Witness evidence

23. For the purposes of Article 20.2 of the LCIA India Rules, the tribunal should endeavour to determine as early as possible in the proceedings, the time, manner and form of taking witness evidence.

The Award

24. One common cause for complaint is the time taken by tribunals to render their Awards after the close of the proceedings.

25. Once the timetable for the final stages of the arbitration is fixed and the length and complexity of the Award can be better judged, the tribunal should make an appropriate provision in its diary for its deliberations and the completion of the Award.

Costs of the Arbitration

26. Another common cause for complaint concerns overly lengthy proceedings. Subject to the overriding principle of due process, therefore, arbitrations should be conducted and concluded as expeditiously as possible, avoiding not only unnecessary delay, but also the unnecessary cost associated with protracted proceedings.

27. By Article 24.2 of the LCIA India Rules, the tribunal may not proceed with the arbitration unless it has ascertained from the Registrar of LCIA India that sufficient funds are held on deposit. Arbitrators should, therefore, regularly submit interim fee notes during the course of proceedings, to permit the secretariat to ensure that sufficient advances are directed from time to time.

28. Arbitrators are entitled to charge for time reserved for hearings but not used as a result of late postponement or cancellation by the parties, provided that the basis for such charges have been approved by LCIA India and notified, in advance, to the parties.

29. If the tribunal is aware that a scheduled hearing might be postponed or cancelled, it should remind the parties as the hearing dates approach, so that they do not inadvertently trigger cancellation charges by failing to give the tribunal adequate notice.

30. Under the LCIA India schedule of arbitration costs, which form part of the Rules, all arbitrators must keep full details of all time spent on the arbitration, including details of the activities on which the time was spent, and these details must accompany any request for payment on account of fees.

31. No payment, either interim or final, will be made to any arbitrator until LCIA India has satisfied itself that an arbitrator’s fees are reasonable in the circumstances of the case and in light of the agreed procedural timetable.

32. All expenses must also be reasonably incurred and in a reasonable amount, and all claims for expenses must be supported by invoices or receipts.

33. Prior to incurring expenses, the arbitrator should consult the LCIA India secretariat as to what is considered reasonable, in regard, for example, to the class of travel for the distance concerned, and the amount of travel time that may be charged to the parties.

34. By Article 28.2 of the LCIA India Rules, tribunals must specify in their final Award the total amount of the costs of the arbitration. As these costs must be submitted to, and approved by the LCIA Court, it is essential that arbitrators keep their timesheets fully up to date, so that their Award is not delayed whilst the LCIA India secretariat awaits final details of the time spent, and costs incurred, for approval by the LCIA Court and inclusion in the Award.

Secretaries to Tribunals

35. Subject to the express written agreement of the parties, a tribunal may appoint an administrative secretary to assist it with the internal management of the case.

36. The duties of the administrative secretary should, however, neither conflict with those for which the parties have contracted with LCIA India, nor constitute any delegation of the tribunal’s authority.

37. Administrative secretaries should, therefore, confine their activities to such matters as organising papers for the tribunal, highlighting relevant legal authorities, maintaining factual chronologies, keeping the tribunal’s time sheets and so forth, and LCIA India will liaise with the administrative secretary on such matters.

38. The LCIA India secretariat will deal with all matters required of it under the LCIA India Rules; will provide any reminders that may be required on the procedural timetable; and will, if requested, finalise arrangements for hearing venues, transcripts and so on.

Keeping the Secretariat

39. Secretariat staff are always available to assist the tribunal with all practical matters and the tribunal should not hesitate to call for assistance whenever this may be required.

40. The tribunal should, in all circumstances, keep the secretariat fully informed of progress during the course of the arbitration.

Important Note

41. LCIA India is a neutral and independent arbitral institution, providing administrative services only, and neither practises law, nor renders legal services. Neither arbitrators, nor parties, nor legal practitioners should, therefore, interpret, or rely upon, these notes as any form of legal advice, as they are drafted only with a view to facilitating the diligent and timely conduct of arbitral proceedings.