Dear students,

As promised, below are the likely answers for the scenarios we discussed yesterday. Remember, since
the IBA Guidelines on Conflicts of Interest in International Arbitration 2014 is not a mandatory
instrument, there is no definite answer about how each of these situations would be treated in
practice (although nearly all of the scenarios below are based on real cases).

Scenario No. 1

GerCo (a legal entity incorporated under the laws of Germany) and RusCo (a legal entity incorporated
under the laws of Russia) agreed to arbitration by a three-member tribunal. RusCo nominated Dr. Ivan
Murphy, a citizen of the UK, who is permanently employed as a professor at Saint-Petersburg State
University (Russia). – This is allowed since the arbitrator works in a different entity. The fact that the
university is state-supported is not relevant.

Consider if:

1) Dr. Ivan Murphy is also a citizen of Russia and consequently has dual citizenship. – It is fine,
especially in a three-member tribunal. However, the appointment/nomination of a sole
arbitrator of the same nationality as one of the parties is generally (but not always) prohibited.
2) Saint-Petersburg State University has concluded cooperation agreements with several
companies, including RusCo, which provide for the creation of job opportunities for the
university’s graduates, possibilities for teaching by employees of such companies and the
establishment of external funding for talented students. – Red list circumstance: receipt of
funding from one of the parties, even though such funding is not directly given to the
arbitrator, but to the institution he is employed by.

Scenario No. 2

ABC Limited, the largest state-owned enterprise in country X, has launched arbitration against XYZ
Incorporated. The latter nominated Dr. Elizabeth Hanson as an arbitrator in a three-member tribunal.
Following such nomination, ABC Limited discovered two articles published by Dr. Hanson in which she
made several critical remarks about poor internal management of ABC Limited which had resulted in
significant losses to taxpayers in country X and some shadowy practices the company is involved in for
securing significant tax privileges. The dispute with XYZ Incorporated, however, does not relate to
these matters of concern. – The arbitrator will be challenged because of the high probability of bias
towards one of the parties.

Consider if:

1) Critical remarks do not relate to ABC Limited, but to its subsidiary company. – Challenge of
the arbitrator, see above. Generally there is a presumption of close relation between a parent
company and its subsidiary.
2) Both articles were co-authored by Dr. Hanson. – Challenge of the arbitrator, bias again.

Scenario No. 3

In order to resolve their dispute, BritCo and FranCo decided to refer to arbitration. Dr. Marcus Finnigan
was appointed as sole arbitrator. FranCo challenges his appointment because Dr. Finnigan and Ms.
Audrey Stevenson, acting as counsel for BritCo, are both members of the Chartered Institute of
Arbitrators (CIArb) and both received professional qualifications from the CIArb. – Green list,
membership in professional, voluntary or educational organisations is not considered as a
circumstance which may affect an arbitrator’s independence and impartiality.

Consider if:

1) Dr. Finnigan is a full-time senior lecturer at Birmingham City University. Ms. Stevenson is a
sessional lecturer at Birmingham City University who teaches only a Comparative Business
Law module to students enrolled for the International Summer School at the university. –
Teaching in the same educational institution is not considered as a circumstance which may
affect an arbitrator’s independence and impartiality, green list.

2) Six months prior to his appointment as an arbitrator, Dr. Finnigan was moderating a panel at
the Cambridge Arbitration Day conference at which Ms. Stevenson was one of the speakers.
Moreover, two years ago both were speakers at the CIArb Mediation Symposium and posted
the same photo (pictured together with three other speakers and the CIArb President) from
this event on LinkedIn, a social network in which both Dr. Finnigan and Ms. Stevenson are
connected. – Participation in conferences and professional events is not considered as a
circumstance which may affect an arbitrator’s independence and impartiality. The photograph
is irrelevant, especially because they are pictured together with other speakers. Social
network connection is also irrelevant, unless you can prove that these two have close
friendship outside professional life (which is extremely hard to prove!).

Scenario No. 4

In order to resolve their dispute, BritCo and FranCo decided to refer to arbitration. Ms. Wong was
appointed as a sole arbitrator. Upon appointment, Ms. Wong disclosed that around 5 years ago she
represented ScotCo, a company closely affiliated with BritCo, in litigation against FranCo. – According
to the IBA, the disclosure period is three years before the appointment/nomination.

Consider if:

1) When representing ScotCo in litigation, Ms. Wong advanced (unsuccessfully) a case of fraud
against FranCo. – It is generally considered that the advancement of a fraud case against a
party in the past gives justifiable grounds towards impartiality of an arbitrator. High
probability of bias.
2) Ms. Wong and Mr. Brown, who is acting as counsel for BritCo, have once served together as
arbitrators. – Green list

Scenario No. 5

In order to resolve their dispute, BritCo and FranCo decided to refer to arbitration. Mr. Parker, a
former partner of Kingsley and Partners who retired from practice seven years ago, was appointed as
sole arbitrator. Mr. Parker acknowledged that he probably had consulted for BritCo at the beginning
of his career in 1989, when he was an associate at Kingsley and Partners, but he cannot recall in what
matter or on what issue. - According to the IBA, the disclosure period is three years before the
appointment/nomination.

Consider if:

1) Kingsley and Partners represents BritCo in the arbitral proceedings. Mr. Parker comments that
the lawyers representing BritCo are unknown to him because they had joined the firm after
his retirement. – The standard practice is to give persuasive value to arbitrators’ disclosure
statements. Here he says he does not know these lawyers, then it is presumed to be so.
 2) Due to the renowned reputation of Mr. Parker in the area of insurance transactions, he often
serves as an expert witness in courts with regards to specific aspects of insurance practice. In
particular, he had acted as an expert witness for Kingsley and Partners at least three times in
the last three years and had likely received some fees for these assignments. The dispute
between BritCo and FranCo does not concern insurance law. – Payments received from one
of the parties. Red list.

Scenario No. 6

This is based on a real challenge launched against the whole tribunal at the LCIA. The LCIA ruled the
challenge to be unsuccessful. The party went to English court, which also refused to accept the
challenge (see P v Q 2017 EWHC 194 (Comm)).

You are representing Mercury Ltd in arbitration (a three-member tribunal) against Jupiter
Corporation. From the outset of the proceedings a tribunal secretary was appointed. After several
months filled with hearings and various communications, you received an email from the Chairman of
the tribunal, which was clearly intended for the tribunal secretary. The email requested the tribunal
secretary’s reaction with regards to the latest correspondence with you (“Your reaction to these
clarifications by Mercury?”). Next day the Chairman acknowledged that he had erroneously sent the
email and apologised for it. Based on this error, should you challenge the Chairman (or the whole
tribunal) on the basis of improper delegation of duties?

Consider if:

1) Following the receipt of the erroneous email, you requested the most up-to-date time sheets
of the tribunal secretary and each member of the tribunal. Time sheets showed that the load
of the tribunal secretary is on par with the load of other two arbitrators, but significantly less
than the Chairman’s. Based on this information, should you challenge the Chairman (or the
whole tribunal) on the basis of improper delegation of duties?

2) Following the receipt of the erroneous email, you requested the most up-to-date time sheets
of the tribunal secretary and each member of the tribunal. Time sheets showed that the
tribunal secretary was involved in drafting procedural orders for the tribunal. Based on this
information, should you challenge the Chairman (or the whole tribunal) on the basis of
improper delegation of duties?