Cost in Arbitration Proceedings and Tribunals - Assignment Example

Cost in Arbitration Proceedings and Tribunals Term Paper Case Miss Duval is considering making an award in favour of Booter Construction Limited in arbitration against Kwik Kuts Supermarket Limited. She is minded to order Kwik Kuts to pay Booter’s costs and directed that she should undertake the assessment of those costs. The paper provides a memo advising Duval on best approach of the procedures for the assessment of costs. It is necessary for Miss Duval to acknowledge that assessment of costs is based on certain condition. She must understand that the costs of the arbitration comprise the expenses and fees of the arbitrators and administrative expenses set by the tribunal, in agreement with the scale in power at the instance of the start of the arbitral proceedings, also the fees and expenses of given experts selected by the Arbitral Tribunal and the sensible legal and other costs sustained by the parties for the arbitration. Miss Duval as arbitrator must itemize expenses on the statement of cost in a layout certified by the General Counsel and must state the name and contacts to which payment must be made (Booter Construction Limited). In the situation whereby there is need for rate adjustment proceeding, every statement of cost must indicate each partys portion of the sum cost and the sum owed by that party, or otherwise, reflects the technique of payment approved upon by the arbitrator and parties. The procedure of assessment of costs involve systematic approach whereby Miss Duval must evaluate the costs involve and fairly make the award of costs, in accordance to existing laws and regulation. The Arbitration Act 1996 regulation would assist Miss Duval in the assessment of costs as it gives some standards to be followed by arbitrators in the assessment of the costs. All the principles are not mandatory as in some cases the parties may contract out. According to Section 61 chapter two, the arbitrator is suppose to award costs on the broad principle that costs should be attached to the event in case the two parties do not contract out. This means that the arbitrator, in order to come up with the costs; need to follow the case and its unique circumstances. According to section 63 of arbitration Act 1996 that discusses the recoverable costs of the arbitration.1 Section 1 declares that the parties are at liberty to concur what expenses and fees of the arbitration are recoverable. These provisions can assist Miss Duval in the procedure of assessing the cost since all the provisions and requirements are stipulated. This case declares that Miss Duval has been instructed to order Kwik Kuts to pay Booter’s costs and this must be agreed upon by both parties prior to enforcement. Under Section 63(1) of the arbitration Act 1996 the parties are at liberty to agree on what costs of the arbitration could be recovered.2 Miss Duval work has been simplified since the agreement that Kwik Kuts Supermarket Limited pay costs of Booter Construction Limited had been made. The provisions of the Arbitration Act 1996 (52) provides the form of a ward that Miss Duval can use during the procedure to ensure the regulation are followed. These are: (1) the parties are at liberty to agree on the kind of an award. (2) If or to the point that there is no such accord, the subsequent provisions apply3. The award shall be in formal form signed by all the parties or all those agreeing to the award. The award shall declare the settlement of the arbitration and the time when the award is completed. These matters would assist Miss Duval to understand the consequence of her actions. Act 1996 (59) concerning costs of the arbitration provides the procedures Miss Duval can use to assess the arbitration cost. (1) References in this subsection to the costs of the arbitration are concerned with (a) the arbitrators’ expenses and fees, (b) the expenses and fees of any arbitral organization concerned, and (c) the legal or extra costs of the involved parties4. Section 64(1) of arbitration Act 1996 declares that unless otherwise approved by the involved parties, the recoverable cost of the arbitration must comprise of the expenses and fees of the arbitrators such as rational fees and expenses. Miss Duval can use this provision as a guiding principle during procedure of assessment of costs. Unless the parties are in agreement, any obligation under a contract between parties as to how the costs of the arbitration are to be awarded are broaden only to provide costs as recoverable. The Chartered Institute of arbitrator presents three types of cost that may be incurred in the procedure namely (a) Liability for the expenses and fees for the arbitrator (b) Fees and expenses liability of any institution of arbitration involved (c) Legal and other related costs that may be incurred directly by the disputing parties. All of these costs may arise at the same time or only one or two may arise.5 It will be therefore upon the arbitrator to identify which of these three costs have arisen. The arbitration tribunal has the discretion as to which awards of costs could be included with regard to the unique circumstances of the case. However, this must follow some lied down principles given in the arbitration Act of 1996. It is therefore imperative for an arbitrator to ensure that he has put all the circumstances of the case under consideration so as to come up with the relevant costs. The Civil Procedure rules allow Miss Duval independently (and after assessing the circumstances of the case) come up with a combination of the costs or all those costs, as the case may dictate. Case 2 The losing party, Skinner Technical Limited, has stated that Miss Duval may not assess the costs herself, as Arbitrator, but must refer the matter to a Court. In this case, the basic position is that if the arbitration agreement makes no provision for the costs to be assessed by the court then Miss Duval can deal with the assessment herself save as provided in the Act. However, the law provides that in case of a dispute of arbitration costs court input could be sought to handle the case. The costs that the arbitrator can award are costs which are rationally incurred by the other party to the arbitration in correlation with the arbitration, if the costs are not agreeable then one part can seek courts redress. This requirement of a correlation may consequence in the arbitrator or party disallowing costs incurred prior to the service of the arbitration notification.6 Section 65 of the 1996 Act introduced a fresh principle that state, unless otherwise contracted by the parties, the arbitral court could give direction on the recoverable costs or of any section of the arbitral procedures.7 The purpose of the department is to enforce a maximum limit on the costs so that, even if a party can spend as much as it preferred on arbitration, it would not be capable to recover more than the ceiling amount. It is also to daunt those with deep pockets from intimidating their opponents into giving up through fear of incurring a liability for costs beyond their means. Most awards are obeyed or accepted voluntarily. When a party against whom the award has been granted fails to obey, the party in quest of enforcement can apply to court’s redress. The domestic courts can implement an arbitral award in the similar manner as an order or judgement of the court. This denotes that all the criteria for enforcing a judgement of the court are also obtainable to implement the award, including amid others, award of damages, an injunction, and specific presentation. Case 3 This case seeks to present manners of how Arbitration Award is enforced. Miss Duval want to remind herself of procedure of enforcing arbitration award. This will help her to inform Mr Skinner in no unsure terms, what will be the consequence if he does not pay up. Non-payment by a party of its portion of the costs alone would not quantify to a repudiatory violation of the arbitration contract, permitting the non-defaulting group to take the claim in court. This could lead to higher cost to shoulder by defaulting party. It remains important to be conscious that the rebuttal to pay costs without legitimate reasons may have penalties. At the very least, the court may seem less favourably on the non-payment party during the execution of the arbitration. The arbitrator has authority and judgement to react as the circumstances dictates. This includes, but not limited to examining the behaviour and conduct of the parties. 8The exclusion clause in section 61 chapter 2 of arbitration Act 1996 gives discretion to the arbitrator to really determine the costs putting into contemplation the parties’ overall behaviour and conduct.9 Therefore, Miss Duval can check on the provisions of this section that can assist her to inform Mr. Skinner of the consequences of his conduct.10 It is apparent that Miss Duval, as the arbitrator, has the authority to apportion the arbitration costs to the parties in whichever way she deems fit based on the circumstance of the case, such as the conduct portrayed by Mr. Skinner. According to section 66 of arbitration 1996 Act (1), an award provided by the tribunal pursuant to arbitration accord may, by leave of the courtyard, be enforced in the similar way as an order judgment of the court to the similar effect. Where leave is so provided, ruling may be made in accordance to the condition of the award.11 The third part confirms that leave to enforce an award shall not be provided where, or to the extent that, the party against whom it is wanted to be enforced displays that the tribunal has no substantive jurisdiction to create the award. This can guide Miss Duval in addressing Mr Skinner case and let him know the Case 4 Miss Duval seeks reassurance on the circumstances in which an arbitrator’s award may be challenged following Mr. Skinner remarks. In limited circumstances, it is doable to challenge an award; even in a place where the pertinent rules of process provide that the award is ultimate and binding. If an award is effectively challenged, in complete or partially, then it will typically be handled as being unacceptable and consequently not enforceable by the judges of the arbitration, but as well as by national courts in another place. Some instances of potential reasons for challenging an arbitral award include: a lack of a legitimate arbitration accord, failure to obey due process, or an issue of public policy. This confirms that the reasons or remarks of Mr. Skinner do not meet the threshold for challenging award.12 It is also evident that the arbitrator has no necessary jurisdictions to create the award he or she made (lack of legitimate reason).13 In accordance to Arbitration Act 1996, this may not be thriving if the petitioner does not question or challenge the jurisdiction of the arbitrator within the sensible timeframe. This notwithstanding, Section 30 of the Arbitration Act 1966 still gives the arbitrator powers to make a decision his own jurisdiction to the parties, except the aggrieved party successfully challenges it in court in within sensible time. According to section 67 concerning challenging the award under substantive jurisdiction the following points are essential to monitor. (1) A party to arbitral procedures may, after giving notice to the tribunal and the other parties, make application to the court (a) challenging provided award of the arbitral committee as to its substantive authority; or (b) for an order pronouncing an award constituted by the tribunal on the benefits to be of no consequence, in whole or partially, since the tribunal did not have complete jurisdiction.14 A party could lose the privilege to object and the right to make an application is subject to the restrictions in part 70(2) and (3). The arbitral court may carry on the arbitral proceedings and create a further award while a submission to the court under this sector is pending in correlation to an award as to jurisdiction. If the arbitrator commits serious irregularities in the process of giving the award, according to section 68 of the Arbitration Act 1996, the award could be challenged if the indiscretions on the part of the arbitrator ground significant unfairness to the applicant. For this to thrive, the applicant requires to prove both the serious irregularity and the resulting significant injustice. The court shall not implement its power to set apart or to announce an award to be of no consequence, in whole or partially, unless it is content that it would be improper to remit the matters in question to the tribunal for reconsideration.15 If there is a mistake of law within the award, though, this argument may not reverse the award in the UK, unless in exceptional and rare circumstances. The distressed party may challenge the award based on mistake of law with the leave of the tribunal, only if the law query was among the questions the court was obligated to resolve and that it wrongly resolved it resulting to significant effect to the appellant.16 A challenge under this circumstance is difficult because the court cannot grant the leave to appeal unless a prima facie case is made and the law question under review is one of the general public reasons and the decision made raises some major doubts. Case 5 Mr. Dominic Duval wishes to claim Constructive Dismissal in the Employment Tribunal due to role change. Miss Duval (his sister) is willing to assist with the case though concerned about a Costs Order that may be made against her brother. This section analyses possibilities of costs order and its applicability. A costs order is a situation the court orders a given party to compensate the other partys legal costs.17 They can be awarded at any phase of the procedures or after the proceeding completes; can be awarded in correlation with the whole procedures, a particular problem or a particular section of the proceedings; and are at the prudence of the court. However, a costs order will frequently be made at the conclusion of the procedures and influenced by the outcome of the event, unless the court orders in contrary. In other words, the failed party will usually be ordered to pay the costs of the triumphant party.18 This denotes that if Miss Duval failed to win the case of her brother, she may be required to pay a part of the other partys legal fees. The case leads to discretionary order, where a magistrate’s order may be provided after a take into custody for an offense involving family members. Mandatory order involve an arrest for a felony involving family offences, an emergency order of protection ought to be issued if the magistrate gets the offense also involved. Specific order concerns type of order that is used when the Court is requested to resolve a subject concerning to the children, other than habitation or contact, where members cannot agree. This type of order would be applicable were you and your ex-partner unable to agree which school to send your children to, whether the children should go to a particular place of worship, whether or not a particular type of medical treatment should be used, or if either parent wished to ask the Court´s permission to change a child´s name. The cost liability among parties to court proceedings is recognized as party to party costs. This used to be referred to as a kind of costs appraisal to decide how much costs ought to be paid.19 As a general regulation, if a plaintiff is successful in making request to the Court throughout the proceedings or is successful in the court case overall, the Court is probable to make an order for imbursement of its costs by the other party. If a plaintiff is unsuccessful in any proceedings made to the Court or in the proceedings as an entire, then an order to compensate the costs of the other party may be made beside the plaintiff. This leaves Miss Duval to assess the chances of winning. Where the Court is considering whether to exercise its power under section 52A or 52B of the Ordinance to make a costs order in favour of or against a person who is not a party to the relevant proceedings- (a) that person must be joined as a party to the proceedings for the purposes of costs only; and (b) that person must be given a reasonable opportunity to attend a hearing at which the Court shall consider the matter further.20 In any appraisal of costs an unsuccessful plaintiff may not be regimented to pay the full costs of the successful partys definite costs. The definite costs recoverable from a losing group may be restricted as follows. (a)The appraisal of costs may be either on the indemnity or standard basis. Costs are frequently assessed on the standard foundation. (b) Litigants may be needed to file and substitute costs budgets at an early period in the proceedings. (c) The Court could award costs to mirror which party thrived on each individual subject in the case.21 In another condition, cost orders may be imposed to a claimant if an arbitrator with whom they have relations is representing him or her.22 However, the same may not apply if the application is made in a tribunal in which the relative has no connections. Representing a relative is seen as conflict of interest and thus the tribunal may impose all the costs to the claimant as this is seen as a violation of the general principle.23 Generally, in common law, one is not allowed to preside or seat in a tribunal in which she or he knows that conflict of interest is bound to arise.24 References List Bailey, J. Construction Law; Construction Practice Series. CRC Press, 2014 Birks, H. Practice Notes on Contentious Costs. Routledge, 2013 Derains, Y, and Eric A.S. A Guide to the ICC Rules of Arbitration. The Hague [u.a.: Kluwer Law Internat, 2005. Merkin, R. and Flannery, L. Arbitration Act 1996; Lloyd’s Arbitration Law Library. Revised, annotated. CRC Press, 2014. Stephenson, D. Arbitration Practice in Construction Contracts. Chichester: John Wiley & Sons, 2001. Internet resource. Read More