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5 Article 2: Consultation on Evidentiary Issues

Roman Khodykin, Carol Mulcahy, Nicholas Fletcher

From: A Guide to the IBA Rules on the Taking of Evidence in International Arbitration

Roman Khodykin, Carol Mulcahy
Edited By: Nicholas Fletcher

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2023. All Rights Reserved. Subscriber: null; date: 06 June 2023

Conduct of proceedings — Evidence — Arbitral rules

(p. 77) Article 2: Consultation on Evidentiary Issues

Article 2  Consultation on Evidentiary Issues

  1. 1.  The Arbitral Tribunal shall consult the Parties at the earliest appropriate time in the proceedings and invite them to consult each other with a view to agreeing on an efficient, economical and fair process for the taking of evidence.

  2. 2.  The consultation on evidentiary issues may address the scope, timing and manner of the taking of evidence, including:

    1. (a)  the preparation and submission of Witness Statements and Expert Reports;

    2. (b)  the taking of oral testimony at any Evidentiary Hearing;

    3. (c)  the requirements, procedure and format applicable to the production of Documents;

    4. (d)  the level of confidentiality protection to be afforded to evidence in the arbitration; and

    5. (e)  the promotion of efficiency, economy and conservation of resources in connection with the taking of evidence.

  3. 3.  The Arbitral Tribunal is encouraged to identify to the Parties, as soon as it considers it to be appropriate, any issues:

    1. (a)  that the Arbitral Tribunal may regard as relevant to the case and material to its outcome; and/or

    2. (b)  for which a preliminary determination may be appropriate.

A.  Introduction

5.1  Article 2 addresses the active role that a tribunal is encouraged to play in ensuring that the taking of evidence is handled in an efficient and economic manner, while at the same time making sure that the process is fair to both sides. It requires the tribunal to (p. 78) initiate and to participate in discussions with the parties on evidentiary issues. It also encourages the tribunal to identify issues that are important to a determination of the dispute, or the early determination of which may lead to a quicker or more efficient resolution.

5.2  Article 2 is a new provision introduced by the current IBA Rules. The IBA Commentary1 reveals that the drafting subcommittee considered whether and how the IBA Rules could be adapted in light of the increased size and complexity of arbitrations and the evidentiary issues associated with them. After careful consideration and a review of various domestic and international arbitration rules and procedures, the subcommittee decided to adopt what they describe as a ‘meet and consult’ approach.2

5.3  Article 2 consists of 3 parts:

  1. (a)  Article 2.1 provides for a mandatory consultation between the tribunal and the parties at the earliest appropriate time in the proceedings with the objective of agreeing on an ‘efficient, economical and fair process for the taking of evidence’.

  2. (b)  Article 2.2 provides a framework for discussing evidentiary issues. It sets out a non-exhaustive list of evidentiary matters that the tribunal and parties may wish to consider during the mandatory consultation.

  3. (c)  Article 2.3 encourages, but does not require, the tribunal to identify to the parties, as soon as it considers it to be appropriate, any issues: (i) that the tribunal may regard as relevant to the case and material to its outcome; and/or (ii) for which a preliminary determination may be appropriate.

5.4  A similar approach is adopted in a number of institutional rules that also contain express provision for the parties and the tribunal to make early contact to discuss and agree proposals for the conduct of the arbitration.3 Similarly, soft law guides, including the UNCITRAL Notes on Organizing Arbitral Proceedings and the ICC Guide to the Effective Management of Arbitration, emphasize the benefits of early consultation between the parties.4

5.5  What distinguishes Article 2 from other provisions is that it encourages the tribunal and the parties to focus on evidentiary issues—something that is largely overlooked in institutional rules, but which may be particularly important where parties are from (p. 79) different legal traditions and have different expectations. The consultation process under Article 2 provides a forum where these different views may be aired.

5.6  In most arbitrations, early consultation between the tribunal and the parties will result in a first procedural order dealing with a wide variety of issues including, but not limited to, the process by which evidence will be taken. However, because such discussions tend to deal with all procedural aspects of the arbitration, the process for the taking of evidence may not be addressed in as much detail as when guided by the provisions of Article 2.2. This may mean that opportunities to improve the efficiency of the process are missed.

5.7  Articles 2.1 and 2.2 are entirely new provisions. However, they very much reflect the overarching objective found in Preamble 1 to the IBA Rules that the IBA Rules are to provide an ‘efficient, economical and fair process’ for the taking of evidence in international arbitration. The provenance and practical application of this principle is discussed in detail in Chapter 2. The relationship between Preamble 1 and Article 2 should not be overlooked. Preamble 1 provides context and additional weight to the Article 2.1 requirement that parties and the tribunal must consult early on matters of evidence.

5.8  Article 2.3, which deals with identification of issues relevant to the case and material to its outcome and/or potential preliminary issues, is a development of what was paragraph 3 of the Preamble to the 1999 IBA Rules. The only material difference is that, in those earlier rules, issues appropriate for preliminary determination were expressed as a subset of issues that the tribunal regarded as being relevant and material to outcome.5

5.9  An IBA Report indicates that Article 2 has been referenced in only 8 per cent of cases in which the IBA Rules were applied.6 However, this does not mean that tribunals will not have engaged in consultation with the parties at an early stage of the proceedings, either because they are required to by applicable institutional rules or as an exercise of their general case management powers.

5.10  Limited application of Article 2.3 may be due to a concern on the part of some arbitrators that early identification of issues by the tribunal could lead to allegations of prejudging the dispute and result in a challenge to the tribunal and/or the award. As one commentator puts it:

The focus on the decisive issues probably has the largest potential for improving costs control and efficiency in international arbitration . . . On the other hand, some (p. 80) arbitrators might feel uncomfortable telling the parties at the outset of the proceedings which issues they consider to be important. They might be concerned that this is premature and improper and could even lead to accusations of partiality.7

5.11  There have indeed been attempts to set aside awards on the basis that the tribunal prejudged the case or predetermined the outcome of the dispute by raising matters similar to those articulated in Article 2.3. However, if the tribunal exercises its powers prudently, the prospects of success of such challenge should be limited. For example, during proceedings to challenge an award brought before the Swedish Svea Court of Appeal,8 an argument of prejudgement or bias was raised in relation to comments made by the chairman of the tribunal during a pre-hearing conference. Those comments were directed at identifying for the parties issues that the parties should focus on during the hearing. It was alleged that the comments were directed at one party more than the other and that, as a result, the chairman was helping the former party to prepare its case. The court rejected the claim of lack of impartiality or bias.

5.12  In our view, proper use of Article 2.3 should be encouraged. Tribunals should not fear challenges based on allegations of prejudging the dispute. Case law shows that the courts are slow to make any findings against arbitrators exercising their powers in the interests of efficiency, provided the tribunal complies with its duties to the parties—in particular, giving each party a reasonable opportunity to present its case and properly considering the arguments on each side.

B.  Consultation: Party/Party and Tribunal/Party

  1. 2.1.  The Arbitral Tribunal shall consult the Parties at the earliest appropriate time in the proceedings and invite them to consult each other with a view to agreeing on an efficient, economical and fair process for the taking of evidence.

1.  Overview of the Consultation Process

5.13  Article 2.1 addresses the initiation and purpose of the consultation process.

5.14  The proposed consultation has two elements. It requires the tribunal to (a) consult the parties and (b) invite the parties to consult with each other. These two elements are two sides of the same coin, although there are some differences.

(p. 81) 5.15  The first element (consulting the parties) means that the tribunal should seek the views of the parties on evidentiary matters.

5.16  As mentioned, this is consistent with a general recognition that early consultation between the tribunal and the parties is a key factor in ensuring efficiency of time and costs. Early consultation may enable a timetable and date for an evidentiary hearing to be fixed. It may also flush out issues that might otherwise adversely affect the efficiency and fairness of the process if raised later in the proceedings. In addition, it may alert the tribunal to differences in approach between parties from different legal traditions.

5.17  The second element (inviting the parties to consult with each other) appears to put the onus on the parties to consult with each other with the aim of agreeing a process for the taking of evidence. However, it is not clear whether the words ‘with a view to agreeing’ apply solely to the consultation between the parties, or whether they refer also to the suggested consultation between the parties and the tribunal. In other words, it is not clear whether Article 2.1 puts the onus on the parties to reach an agreement or whether it is a consultation between the parties and the tribunal that is intended to lead to an agreement. The first interpretation may acknowledge the fact that, in the early stages of an arbitration, the parties may be better placed than the tribunal to understand the issues in the case and to tailor an appropriate procedure. The second interpretation recognizes the important role that the tribunal may play in mediating between the parties and, as necessary, imposing a procedure that balances their competing interests and gives effect to the tribunal’s obligation to organize the arbitration as efficiently as possible. In practice, the distinction may be of little relevance. Parties will generally explore what measure of agreement can be reached and will then lay that provisional agreement before the tribunal. The tribunal will stress test and raise questions on what is proposed before moving on to explore with the parties whether any middle ground can be reached in relation to the remaining disputed matters.

2.  Timing of the Consultation

5.18  Article 2.1 requires the tribunal to consult the parties ‘at the earliest appropriate time in the proceedings’ but no time limit is set. This is in contrast to some institutional rules that do set a time limit.9

5.19  The focus of Article 2 is consultation on ‘evidentiary issues’ as opposed to more general procedural issues; this may have an impact on when the ‘earliest appropriate time’ for consultation on those issues may arise.

(p. 82) 5.20  In some cases, not all evidentiary issues will have crystallized in the initial stages of an arbitration and it may be appropriate to postpone some elements of the consultation to a later date. This point is addressed in the IBA Commentary:10

Under normal circumstances, this consultation would coincide with a procedural conference or exchange of views early in the proceedings. Early timing allows the participants to organise the taking of evidence in an efficient, economical and fair manner. Where evidentiary issues are not considered to be sufficiently clear at an early stage in the arbitration, the arbitral tribunal might postpone such conference or exchange.

5.21  By way of example, US respondents to a survey on use of the IBA Rules11 indicated that, in their experience, consultation on evidentiary issues usually comes at a later stage of the arbitration and that parties may be less willing to discuss evidentiary issues before written submissions have been exchanged and the matters in issue are clear.

5.22  However, this does not mean that the entirety of the consultation should be left for many weeks or months after commencement of the arbitration. It may be important to address some issues early. For example, in the context of document production, where parties intend to use computer technology to retrieve potentially relevant documents by use of parameters based on key word searches, date ranges, custodian, or location, early consultation between the parties to agree those parameters may be very important. If the parties do not discuss and agree a consistent approach, complaints about the scope of retrieval may be made by one side or the other at a later stage. If those complaints are justified, the document retrieval exercise may have to be repeated with a consequential waste of time and costs.

5.23  Thus, in most cases, it will be appropriate to conduct consultation early in the proceedings in order to address those evidentiary issues that can or must be addressed at that stage, leaving others to be dealt with at a later stage or as they arise. Where potentially relevant matters are postponed for later discussion there should be transparency between the tribunal and the parties about the nature of the matters deferred. Those matters should be kept under careful review. In all cases where new issues arise during the course of the arbitration proceedings, further consultation on evidence may be required.

5.24  In the majority of arbitrations, tribunals will wish to issue a first procedural order setting out a timetable for the arbitration. In most cases, this will be an appropriate time for a first round of consultation on the matters described in Article 2. Many arbitrators have a standard first procedural order that they will circulate in draft to the parties following their appointment under cover of a request for comments/proposals. This approach often provides a useful starting point when the IBA Rules are being applied. (p. 83) When circulating the draft the tribunal can ask the parties to give particular consideration to the matters identified in Article 2.2.

5.25  Another way of encouraging parties to actively engage in consultation is for the tribunal to send them a questionnaire inviting their comments on topics identified in that document. Reported ICC cases provide examples of this.12 In similar vein, the Practice Guidelines issued by the Chartered Institute of Arbitrators recommend that arbitrators should prepare a draft agenda for a case management conference with the parties and circulate this to them for comment.13

5.26  In all of these scenarios, the tribunal will wish to issue a procedural order at the relevant time recording the process agreed on or determined by the tribunal in respect of the matters discussed.

3.  Achieving a Process that Is Efficient, Economical, and Fair

5.27  Article 2.1 envisages the agreement of an efficient, economical and fair process for the taking of evidence. The provenance, development and practical application of the principle of an ‘efficient, economical and fair process’ is considered in detail in Chapter 2. As discussed, there is potential for tension between the objectives of efficiency, economy and fairness. For example, considerations of efficiency may favour avoiding unnecessary steps in the process, but this approach may conflict with fairness in the sense of allowing party a reasonable opportunity to put its case. At one extreme, options for improving efficiency could—in theory—include limited (or no) document production and/or fact or expert evidence, and deciding the case solely on the basis of written submissions without an oral hearing. In relation to each of these possibilities, there is a cost/benefit analysis to be conducted, albeit sometimes an unconscious one. The evidentiary value of each step to a party’s case (and the tribunal’s determination) needs to be balanced against the time and expense required to present it.14 In the event of disagreement between the parties on the appropriate process to be adopted, the tribunal must hear the competing arguments and then take the lead in navigating a reasonable course through the available options that neither offends due process nor results in unnecessary or disproportionate costs being expended.

5.28  A further consideration that the tribunal may have to take into account in certain cases is how best to achieve efficient and fair resolution when one party has greater financial resources at its disposal than the other.15 This issue is discussed further in Chapter 2.

(p. 84) 5.29  The necessity of resolving these tensions highlights the important role the tribunal plays in the consultation process.

a.  Role of the tribunal where parties agree on a process

5.30  Where the parties themselves are able to agree on a procedure for the taking of evidence, does the tribunal still have a part to play in the consultation process provided for by Article 2? In particular, should the tribunal intervene if it feels that the process agreed by the parties is not efficient, economical or fair?

5.31  The lack of clarity around whether successful application of Article 2.1 can be achieved by an agreement between the parties alone, or whether it must necessarily involve agreement by the tribunal (see para 5.17), may have some theoretical relevance to this question. However, in reality, a tribunal may be presented at any time with party agreement on a matter of procedure or evidence either within a consultation process conducted pursuant to Article 2 or outside of it. For this reason, even if under the Article 2.1 consultation process the agreement of the tribunal was determined to be a requirement, and this were to give rise to a conflict between Article 2.1 and a provision of applicable institutional rules (eg Article 22.2 of the ICC Rules), the guidance at Article 1 of the IBA Rules on how to deal with such conflicts would be of limited assistance.

5.32  There are differing views on the more general question of whether an agreement of the parties, or the views of the tribunal, should prevail where there is a difference between the two. One view is that, subject to public policy and applicable mandatory provisions of the law, party autonomy is of fundamental importance and must be respected. This view has been expressed by one commentator in the following terms:

Given the importance of party autonomy as a fundamental principle of arbitration, the arbitral tribunal would do well to follow the parties’ agreement on evidentiary issues unless it violates international public policy or mandatory provisions of the procedural law of juridical seat of the arbitration (lex arbitri).16

5.33  An alternative view, expressed by another commentator, is that the tribunal has an active role to play in the consultation process and should not just accept whatever the parties may agree:

While much can be said in favor of letting the parties prescribe the procedure, it would appear preferable to grant the primary authority to prescribe the applicable procedures to the arbitral tribunal. If arbitration is to maintain its reputation for efficient and effective adjudication, the tribunal must retain control of the arbitral proceedings. The responsibility for ensuring the kind of adjudication arbitration (p. 85) purports to offer rests ultimately with the tribunal which sees to it that the parties obtain what has been promised them. In arbitral practice, the tribunal can obtain the requisite authority by adoption of a procedural order right at the beginning of the arbitration, agreed upon between the parties and the tribunal, granting the tribunal the authority to prescribe the procedural rules that will be observed. Once this order has been adopted, the parties cannot change it without the concurrence of the arbitrators. It also provides the authority for deviating from institutional and other rules the parties may have agreed upon.17

5.34  The CIArb Guidelines suggest a middle ground to the effect that intervention by the tribunal should not be limited to cases where public policy and/or mandatory law provisions are engaged, but should extend to situations where inefficiency, or the incurring of unnecessary costs, would otherwise be the result:

If the parties have reached an agreement as to the procedure to be followed, the arbitrators should respect the parties’ agreement provided that it is not contrary to any overriding mandatory laws and/or principles of public policy at the place of arbitration and/or would cause the proceedings to be conducted in a manner which is inefficient and unnecessarily costly. In these circumstances, arbitrators should consider encouraging the parties to adopt a more suitable procedure and, if appropriate, make a procedural order to that effect.18

5.35  We agree with the latter approach. While acknowledging party autonomy, the tribunal should not accept something it considers would be unproductive and/or would contradict the tribunal’s general duty to conduct the proceedings in a fair, efficient and economic manner.19 In our experience, much may be achieved by means of gentle coercion from the tribunal. In many cases, neither party will wish to antagonize the tribunal in the early stages of the proceedings. However, where (despite the tribunal’s best efforts) there remains a direct conflict between what the parties have agreed and what the tribunal believes is the best way of managing the evidence, the tribunal may sometimes face a dilemma.

5.36  The IBA Rules operate within the legal infrastructure of the arbitration created by the arbitration agreement, the law of the seat, and any applicable institutional rules. These instruments may contain provisions relevant to the position faced by the tribunal. For example, different institutional rules may place more or less emphasis on the tribunal’s role as final arbiter. Article 14.2 of the LCIA Rules provides that parties may agree on joint proposals ‘for consideration’ by the tribunal. In contrast, Article 22 of the ICC Rules states that, following consultation with the parties, the tribunal may adopt such (p. 86) procedural measures as it considers appropriate, ‘provided that they are not contrary to the agreement of the parties’.20 However, in the final analysis, whatever powers the tribunal may have under the applicable institutional rules, the arbitration and the arbitrators are a product of an agreement made between the parties and any authority granted to the tribunal must, as a matter of principle, be subject to the right of the parties to override or vary that position.21

5.37  Mandatory provisions of law at the seat may also have some application to this situation, but again these will not necessarily provide a final resolution of any conflict between the wishes of the parties and the view of the tribunal. This can be illustrated by reference to the provisions of the English Arbitration Act 1996. Section 33 of the Act imposes a mandatory obligation on the tribunal to adopt procedures suitable to the circumstances of the particular case, and to avoid unnecessary delay and expense. Section 34(1) provides that the tribunal shall decide all procedural and evidential matters ‘subject to the right of the parties to agree any matter’. It has been suggested that, in circumstances where, against the wishes of the tribunal, the parties agree to adopt disproportionately expensive procedural steps, there is little the tribunal can do and that discharge of its obligations under Section 33 may be limited to pointing out the consequences of the parties’ agreement.22 Where the tribunal does not feel that it can continue the proceedings in light of the steps agreed between the parties, the only other course open to it may be to resign.23

5.38  The possibility that a tribunal may face such a dilemma was recognized during the drafting of the English Arbitration Act 1996. In comments relating to Section 25(3) of that legislation (providing that where an arbitrator resigns from an arbitration s/he may apply to the English court to be relieved from any liability incurred as a result of that resignation and/or for payment of fees), the relevant government advisory committee responsible for the legislation noted that one situation where it would be reasonable to grant such relief might be where ‘the arbitrator may (reasonably) not be prepared to adopt a procedure agreed by the parties (i.e. pursuant to [Section] 34) during the course of an arbitration, taking the view that his duty under [Section] 33 conflicts with their suggestions’.24 The advisory committee went on to say that:

157. In our view it is neither desirable nor practicable to stipulate that the tribunal can override the agreement of the parties. It is not desirable because the type of arbitration we are discussing is a consensual process which depends on the agreement of the (p. 87) parties who are surely entitled (if they can agree) to have the final say on how they wish their dispute to be resolved. It is not practicable, since there is no way in which the parties can be forced to adopt a manner of proceeding if they are agreed that this is not the way they wish to proceed. The latter is the case even if it could be established that their agreement was ineffective since it undermined or prevented performance of the duty made mandatory by [Section] 33.

[ . . . ]

159. In circumstances such as these, the tribunal (assuming it has failed to persuade the parties to take a different course) has the choice of adopting the course preferred by the parties or of resigning.25

b.  Role of the tribunal where parties are unable to agree a process

5.39  In the event of disagreement between the parties on any aspect of the appropriate process to be adopted, the tribunal must hear the competing arguments and then take the lead in navigating and, if necessary, making a unilateral decision on the best of the available procedural options.

5.40  If only one party (or neither) engages with the consultation process, the tribunal may have to proceed with issuing the procedural order it believes appropriate in the circumstances. However, it is advisable that the tribunal should first share a draft order with the parties to give the recalcitrant party/parties a further opportunity to raise any particular objections to what is proposed.

5.41  From a party perspective, there is a risk in leaving determination of the procedure for presentation of evidence in the hands of the tribunal. In an attempt to find middle ground, the tribunal may come up with a compromise that is not ideal for either party. For this reason parties will generally attempt to agree on steps for the taking of evidence.26 At least in a negotiation they will have a degree of control over the concessions and compromises that are made.

5.42  Under Article 2.1, the tribunal has an obligation both to ‘consult the parties’ and to ‘invite the parties to agree’. These steps are interconnected and the scope of discussions should be similar in each case.

C.  The Matters to Be Considered during Consultation

  1. 2.2.  The consultation on evidentiary issues may address the scope, timing and manner of the taking of evidence, including:

    1. (a)  the preparation and submission of Witness Statements and Expert Reports;

    2. (p. 88) (b)  the taking of oral testimony at any Evidentiary Hearing;

    3. (c)  the requirements, procedure and format applicable to the production of Documents;

    4. (d)  the level of confidentiality protection to be afforded to evidence in the arbitration; and

    5. (e)  the promotion of efficiency, economy and conservation of resources in connection with the taking of evidence.

1.  Overview

5.43  Article 2.2 sets out a non-exhaustive list of the issues that may be considered by the parties and the tribunal as part of the consultation process described in Article 2.1.

5.44  The use of the words ‘may’ and ‘including’ in Article 2.2 makes it clear that the list of topics included there is neither mandatory, nor exhaustive. However, it is a good indication of issues that the parties and the tribunal should consider and, if appropriate, decide at the beginning of an arbitration.

5.45  Article 2.2 suggests that, in relation to each element of the process of taking evidence being discussed, consideration should be given to three distinct aspects: ‘scope’, ‘timing’, and ‘manner’.

5.46  Scope is the identification of the type and breadth of evidence likely to be necessary for the tribunal to determine the issues in the case, eg the topics on which fact and documentary evidence will be required, and what disciplines of expert (if any) will be needed. It may also involve consideration of whether or not a particular step is necessary. For example, in the context of document production, it prompts the parties to consider whether the non-voluntary production of documents (ie production of documents additional to those that each party intends to volunteer in support of its case case) is needed.

5.47  Timing is the setting of a sequence and dates for the relevant steps to be taken within the procedural timetable. For example, in the context of document production, timing determines whether document production requests should be made before, during, or after delivery of written submissions.

5.48  Manner is the identification of how best to present the desired evidence, taking account of the need to do so efficiently and economically while also observing fairness to each party to the dispute.

5.49  The specific issues relevant in a particular arbitration will vary from case to case. The commentary in the next section highlights some of the more common issues that the parties and the tribunal are likely to consider. A more comprehensive checklist of points to consider at the consultation can be found at Appendix 3.

(p. 89) 2.  Particular Matters to Be Considered

a.  Witness/expert evidence

5.50  Article 2.2(a) prompts the parties to consider issues relating to the scope, timing, and manner of taking witness and expert evidence.

5.51  Articles 4, 5, and 6 of the IBA Rules contain specific provisions dealing with witnesses of fact and party-appointed and tribunal-appointed experts. These provisions are considered in detail in Chapters 7, 8, and 9. Parties and the tribunal need to consider these articles when agreeing proposals under Article 2.

5.52  A number of questions may be considered as part of an Article 2 consultation process relating to witness/expert evidence.

i.  Preliminary considerations—is the evidence necessary or desirable?

5.53  Firstly, is there a genuine need for witnesses of fact and/or experts and, if there is, what should it cover? Preparation of witness/expert evidence is time and cost intensive and, to the extent practicably possible, should be limited to that which is needed to determine the dispute.

5.54  In the majority of cases, fact witnesses and/or expert witnesses will be necessary to prove disputed facts and/or to present opinion evidence on technical issues. However, this is not always the case. For example, if the dispute between the parties turns on a question of law, with no dispute as to the facts, there is little need or advantage in calling fact or expert witnesses to testify. If the claimant claims an unpaid debt under a contract, the tribunal will not need a quantum expert to prove the amount to be awarded where the issue between the parties is limited to liability and there is no dispute about the sum due if liability is established.27

5.55  Even if the parties agree that witness evidence is necessary, the tribunal has the power to limit or exclude such evidence.28 This is consistent with provisions found in a number of institutional rules that empower the tribunal to limit the scope of witness evidence.29 The tribunal may also request the provision of witness evidence not volunteered by the parties,30 or may appoint an expert itself under Article 6.31

(p. 90) ii.  Scope of witness/expert evidence

5.56  In cases where evidence from fact witnesses and/or experts is required, Article 2.2(a) prompts the parties and the tribunal to consider early identification of the issues on which witness testimony/expert evidence is desirable; who the witnesses/experts should be; and how many witnesses/experts are genuinely necessary. The tribunal should endeavour to find the right balance between such matters as the time and cost of the proposed evidence, the extent to which it will contribute to establishing the facts in the issue, and whether those facts are on the critical path to a determination of the dispute. Similar considerations may arise in relation to expert evidence.

5.57  For various reasons, parties will often wish to introduce fact evidence from witnesses that may have had only a peripheral part to play in the events that have occurred. The tribunal should endeavour to bring focus to the exercise of identifying the relevant issues of fact to be addressed in witness evidence. This may assist in cutting down the pool of potential witnesses only to those who will add value. For example, a lengthy witness statement that does nothing more than walk the tribunal though the documentary evidence without adding anything of value may be considered a waste of time.

5.58  Articles 4.1 and 5.1 require each party to identify (by a date ordered by the tribunal) the witnesses and/or experts whose evidence it wishes to rely on, and the subject matter of their testimony. These are matters that a tribunal may wish to discuss during an initial consultation. If the parties are not at that stage in a position to express an informed view, the tribunal may impose a date by which the information required by Articles 4.1 and 5.1 is to be provided and defer further detailed discussion on these matters.

5.59  However, even where during initial discussions the parties are unable to name witnesses and/or experts, counsel for the parties are often capable of forming a provisional view as to whether witnesses of fact are needed, and if so, on which issues, as well as what disciplines of expert may be desirable. This information may help to inform the initial timetable agreed during a first consultation.

5.60  At whatever time the information required by Articles 4.1 and 5.1 is provided, it is open to the tribunal to question whether the proposed subject matter of the evidence is necessary for determination of the dispute. If the tribunal is not satisfied by the explanation justifying the evidence, it is, in theory, open to the tribunal to make an order excluding such evidence pursuant to Article 9.2(a) and/or Article 9.2(g).

5.61  As far as expert evidence is concerned, the tribunal will wish to understand the nature, extent, and importance of any technical issues that exist, or are likely to arise between the parties. At as early a stage as possible, the tribunal will wish to gain a preliminary appreciation of the scope and discipline of expert evidence necessary to assist the tribunal in determining the dispute.

(p. 91) iii.  The manner in which evidence is to be presented

Fact evidence

5.62  Fact evidence will be required in most cases. Article 2.2(a) refers to but does not require the tribunal to order the submission of witness statements. However, the commentary to Article 4.4 suggests that the use of witness statements is desirable in the interests of procedural efficiency.32 An alternative is the provision of witness summaries, a brief document containing a summary of the intended scope of witness evidence. Another, but little used, alternative is simply for the witness to turn up at the oral hearing and present his or her evidence ‘live’.33

5.63  Where witness statements are to be submitted, consideration should be given to whether it is desirable and feasible to impose a limit on length. A coherent and well-structured witness statement can be a valuable tool in helping the tribunal to understand the case. Lengthy unfocused witness statements may merely consume time and cost.

5.64  Other points to consider will include whether the witness statements should be organized by reference to issue or phase, the number of rounds of witness statements, and whether parties should have the opportunity to submit rebuttal evidence.34

Expert evidence

5.65  Consultation on expert evidence should extend to whether any expert evidence required on particular issues is best presented by party-appointed experts or by a tribunal-appointed expert.35

5.66  In the majority of cases there will be a consensus, or even an assumption, that the expert evidence should be presented by way of written report with an opportunity for questions or cross-examination during the evidential hearing.

5.67  Another matter often discussed and agreed during consultation on expert evidence is the need for a mechanism by which party-appointed experts may narrow the issues between them, with consequential savings in costs and hearing time. As a result, the procedural timetable will often contain provision for a meeting between experts of the same discipline to explore what can be agreed and, where this is not possible, what their points of disagreement are on the particular issue. Depending on the stage at which the meeting takes place, the experts may then only need to prepare reply reports on the points of disagreement. At the hearing, the cross-examination of the experts may also be more limited. IBA Rules Article 5.4 makes express provision for the tribunal to order such a meeting between experts.

Issues of foreign law

5.68  Additionally, a question sometimes arises as to whether issues of foreign law should be addressed by means of expert evidence or in submissions. It is not uncommon in international arbitration for foreign law to be dealt with as part of submissions—initially in written submissions (with attachment of the relevant (p. 92) authorities) and, if necessary, by supplementary oral submissions—rather than to prove it by expert evidence. Presenting evidence in this way can result in time and costs savings. This is an issue that is best discussed and agreed at an early stage.36

5.69  If the legal team on each side of the dispute includes counsel qualified in the relevant jurisdiction who are able to deal with any question from the tribunal at the evidentiary hearing, then no issue may arise. If the relevant foreign law has similarities with a legal system familiar to members of the tribunal, the tribunal may still be content to proceed without expert evidence where all parties wish to deal with foreign law by way of submissions. In some instances, the parties may insist on appointing expert witnesses to deal with issues of law even though the tribunal does not feel it is necessary. This sometimes happens in investment arbitration cases where the parties wish to adduce expert evidence on international law even though the tribunal may consider itself expert in, and perfectly capable of, applying that law.37

5.70  In the event of dispute the tribunal should decide what is efficient and fair having in mind the parties’ wishes, the likely cost of the expert evidence, and the tribunal’s degree of familiarity with the relevant legal system. In a situation where only one party-appointed member of a three-arbitrator tribunal is familiar with the relevant law, fairness often dictates that, rather than the tribunal simply relying on that one party appointed arbitrator, expert evidence on foreign law should be permitted.38

iv.  Timing of witness/expert evidence

5.71  The timing of delivery of witness/expert evidence will be a key consideration for discussion. In the interests of efficiency, it will be important that the tribunal and the parties are able to fix a date in their diaries for the evidentiary hearing. In order to do this, they will need to agree a timetable for the principal steps leading up to that hearing.

5.72  To this end, thought will need to be given to how much time the parties need to prepare the evidence and whether delivery of the witness evidence should be simultaneous or consecutive.

5.73  The date for delivery will generally be an issue for negotiation between the parties in the context of the overall timetable. The timing of delivery within the procedural timetable (p. 93) may depend to an extent on whether a memorial or common law style approach to submissions/pleadings is to be adopted.

5.74  The memorial style approach derives from the practice of civil law courts where witnesses are normally identified in written submissions, and a summary of their respective testimony is included in those submissions.39 The modern memorial approach adopted in international arbitration generally involves each party submitting an extended pleading incorporating legal argument and reference to the material facts, and accompanied by all documentary evidence relied on and, in many cases, by witness and expert evidence.

5.75  In contrast, the pleadings approach (also known as the conventional or common law approach) requires each party to submit pleadings with only the most relevant documents, and for witness statements and expert reports to be delivered at a later date. One perceived advantage of this approach is that, at the beginning of the arbitration, the parties may not have identified all of the fact and expert witnesses whose evidence they wish to rely on in the proceedings.

5.76  Both approaches are used in international arbitration, with growing acceptance on the part of both civil lawyers and common law lawyers of the other tradition’s approach. This means that the tribunal’s focus can be on determining which is the best approach in an individual arbitration.

b.  Oral testimony

5.77  Article 2.2(b) prompts the parties to consider issues relating to the taking of oral testimony at any evidentiary hearing. This may be a discussion that is deferred to a later stage of the process when there is a clearer understanding of the precise issues in dispute, the identity of the potential witnesses/experts, and the scope of their evidence.

5.78  Article 8 of the IBA Rules contains specific provisions relating to the evidentiary hearing, including the taking of oral testimony. These provisions are considered in detail in Chapter 11. Parties and the tribunal should consider the provisions of Article 8 when discussing proposals under Article 2.2(b).

5.79  Points to consider include:

  1. (a)  Early identification of witnesses whose appearance is requested at the hearing.

Consideration should be given to setting a deadline under Article 8.1 for the parties to identify the fact witnesses/experts whose presence is required. This will promote efficiency by allowing those witnesses to make travel arrangements and to obtain any necessary visas well in advance of the hearing date (see Chapter 11, paras 11.7–11.9).

(p. 94)

  1. (b)  The weight that will be accorded to witness testimony in circumstances where (1) appearance of the witness is not requested and (2) appearance is requested but the witness fails to attend.40

  2. (c)  Whether physical appearance of the fact/expert witness is necessary or whether oral testimony can be given by telephone, video conference or some other technology.

If video conferencing or other technology is to be used, arrangements should be put in place to ensure that the technology and connections are adequate and the procedure followed is a fair one.41

  1. (d)  Scheduling of witnesses and experts and the allocation of time.

There will often be agreement as to how the hearing should be divided up between submissions and presentation of evidence, and how much time each party should have for cross-examination of witnesses.42 This imposes a degree of discipline and may be relevant to considerations of fairness. However, it will generally be difficult for the parties and tribunal to have an informed discussion on such matters until a fairly advanced stage in the proceedings when they know how many witnesses and experts they will be presenting for cross-examination, or the number and breadth of the matters in issue between the parties. For this reason, precise scheduling and allocation of time is an issue that the parties and the tribunal may wish to defer to a later, pre-hearing conference (see further discussion of this topic in Chapter 8).

  1. (e)  Whether interpreters will be required and, if so, the impact of this on the allocation of time between the parties (see for more detail Chapter 7, paras 7.116–7.117, Chapter 11, paras 11.108–11.110).

  2. (f)  Whether a witness should give oral evidence under oath (for more detail, see Chapter 11, paras 11.78–11.85).

  3. (g)  The use of witness conferencing, or ‘hot-tubbing’ (see for more detail Chapter 11, paras 11.72–11.74).

For example, is this something the tribunal thinks it will find useful and do the parties have any objection? It is useful to flush this out early, as very often a compromise is possible that will satisfy everyone. For example, a party may have no objection to hot-tubbing provided that it also has the opportunity to cross examine the other party’s witness/expert.

5.80  Parties are well advised to discuss and agree the date and length of any evidentiary hearing as soon as possible. Where there is a lack of clarity on the number of witnesses and experts, a possible solution may be to book a one-week hearing with a second week (p. 95) being held in reserve, if needed. Arbitrators’ diaries are filled very quickly. If time is not booked well in advance, it may be impossible to add another week; however, it will be much easier to release a second week should that prove to no longer be required. This may be an expensive approach for the parties given that reservation/cancellation fees are often charged by arbitrators. However, in disputes where the value of the claim is substantial and/or an early determination may be critical, it will frequently be justified. If the decision is kept under review it may well be possible to release additional dates before the tribunal’s cancellation policy comes into effect. The tribunal should be prepared to tell the parties if they think the time estimate is too long or too short.

c.  The process for the production of documents

5.81  Article 2.2(c) prompts the parties to consider issues relating to production of documents—both documents to be produced on a voluntary basis and those that may be requested by another party and/or ordered to be produced by the tribunal. Those matters may include consideration of the subject matter of documents potentially relevant to the dispute, the source and manner of collection of such documents, the format in which they are to be retrieved and produced, and whether document production should include electronic documents.43

5.82  Article 3 of the IBA Rules contains comprehensive provisions setting out a process for voluntary and non-voluntary production of documents (see Chapter 6). Unless the parties wish to vary or depart from those provisions, there may be few issues between them concerning the procedure by which document production is to be completed. The parties may simply agree that document production will be conducted in accordance with Article 3. However, even if this is the case, there will still need to be discussion on the timing of those steps—for example, in relation to delivery of requests for production. In addition, there may be questions around the manner in which soft copy documents are to be collected, and the form in which they are to be provided to the other party. Article 2.2 does not expressly address electronic disclosure, but it should be read in conjunction with Article 3.3(a)(ii) and Article 3.12.44

5.83  Other points to consider include early identification of the computer systems, electronic devices, storage systems and media on which the electronic documents are held; how the search is to be conducted; whether the parties are willing to consult on the use of search parameters; and the format and methods for the production of documents. Techniques and guidance for managing electronic document production include the Chartered Institute of Arbitrators’ Protocol for E-Disclosure in International Arbitration and the ICC Commission Report on Techniques for (p. 96) Managing Electronic Document Production.45 See also the more detailed discussion of this topic in Chapter 6.46

5.84  An increasingly common trend is for parties to use special electronic document management platforms to search and select documents. Searching by reference to agreed words or phrases has become a matter of routine. More recently, various electronic platforms have been developed to carry out what is known as ‘predictive coding’. Predictive coding is machine-learning technology driven by human tuition. A senior lawyer reviews a small ‘seed set’ of documents, which is then analysed by the software programme and used to generate a further sample of documents for review. Through a process of iterative refinement, an algorithm in the software used to harvest relevant documents can reach a level of review accuracy that can be applied across the entire dataset, identifying relevant documents in a manner that is far more efficient and scalable than a traditional document review. A series of sample reviews, privilege sweeps, and other human interventions can then be used to verify the results and finalize the documents prior to production. In England, the courts have allowed the use of predictive coding for a review of electronic documents even when that approach was opposed by the other party, who wanted a more traditional keyword search to be used.47

5.85  The use of predictive coding is likely to grow in international arbitration and it may be prudent for the parties to discuss it as part of a consultation agenda, if only to obtain transparency around any party’s intended use of such technology. There is also evidence that the results of a predictive coding review are statistically superior to a traditional manual review.48 Although there remains a risk that the platform can miss potentially relevant material because use of different words was not programmed for retrieval, given the volume of electronic documents being created on a daily basis, parties are becoming more willing to accept the risk that the platform may miss a small number of documents. Nonetheless, there may be cases where the use of the predictive coding is not appropriate due to the limited number of documents to be searched or because it is considered important to find each and every relevant document. The cost of predictive coding can also be very expensive, which may deter some parties from using it where to do so would be disproportionate.

5.86  Another issue around document production often discussed at an early stage and incorporated into a first procedural order is whether the parties wish to use what is (p. 97) known as a ‘Redfern Schedule’ for their document production requests. A Redfern Schedule is a table with different columns in which the requesting party sets out its request and supporting explanation for why the documents are needed. The parties exchange Redfern Schedules and complete their opponent’s table with confirmation of whether the opponent’s request is accepted and, if it is not, on what grounds objection to production is made. Any outstanding disputed items can then be adjudicated upon by the tribunal looking at the Redfern Schedules and then entering its decision in the final column of the table. Chapter 6 provides an example of a Redfern Schedule,49 and sample Redfern Schedules are located in Appendix 4 and Appendix 5.50

5.87  Deadlines for delivery of requests for documents will need to be put in place, and consideration given as to whether there should be a second round of requests following delivery of subsequent submissions or evidence.

5.88  Other issues regarding the format of document production include:51

  • •  whether documents should be produced in hard copy and/or electronically and, if the latter, in what file type;

  • •  if electronically, whether documents should be produced in native format; and

  • •  whether metadata should be produced.

These issues are expressly addressed in the IBA Rules—in particular, by Article 3. If a party wants to depart from the provisions of the IBA Rules governing a particular issue they should raise this during the consultation stage.

5.89  Another question that sometimes arises concerns translation of foreign language documents. In international arbitration there will generally be an agreement or direction that the proceedings will be conducted in a particular language. However, given the types of dispute referred to international arbitration, there will often be documents relevant to the dispute that contain content in a language other than the language of the arbitration. Depending on volume, the burden of preparing a translation of those documents may be significant both in terms of cost and time. Article 3.12 of the IBA Rules makes reference to the use of translations but only to say that any translations introduced in the proceedings should be accompanied by a copy of the original language document.52 However, the IBA Rules do not govern whether translations are required in individual arbitral proceedings, whether particular documents may be translated in part only, or the resolution of disputes regarding translations or the timing of submissions of translations.53

(p. 98) 5.90  The absence of clear agreement on these issues may lead to disagreements between the parties later in the process. Issues around translation of documents were mentioned by a number of respondents to a survey on the use of the IBA rules.54 A law firm respondent in Italy mentioned a case where a party submitted a document without a translation. The opponent party asked the tribunal to declare the document inadmissible due to it not being submitted in the language of the arbitration (English). The tribunal held that the lack of an English translation constituted ‘a curable procedural defect which can be repaired’. On that basis, the tribunal declined to declare the document inadmissible but ordered the party to produce a translation.55 An American respondent reported that, in one arbitration seated in the United States, a party complained that the documents produced were all in a language other than English. The tribunal accepted the opponent party’s argument that the documents need only be produced in the form in which they are kept in the ordinary course of business.56

5.91  In these circumstances it is sensible for the parties to try to reach an agreement early on about the general approach to be adopted with regard to translation of documents and which party will bear the burden (practical and economic) of preparing any translations to be provided. It is sensible for power to be reserved to the tribunal to deal with any issues that may arise during the course of the proceedings regarding specific documents.

5.92  In relation to documents upon which the parties wish to rely, they may consider it sensible to agree that a translation should be provided at the same time as the original document so that the full import of that document is clear to the other party and to the tribunal, regardless of language skills. It may be relatively easy to obtain agreement that the relying party will bear the burden of obtaining a translation as part of the costs of preparing and presenting its case. The position in relation to document production may be more problematic. In many arbitrations a great number of documents are produced but a relatively small number are included in the hearing bundles or are relied on before the tribunal. Given this factor, the early provision of a professional third-party translation with each document may not be the most efficient approach. In some cases, counsel on both sides may have someone in their team who has a good command of the relevant language/s and the parties may be content for documents to be produced without a translation. When the parties later identify the documents (if any) that they wish to refer to before the tribunal, that document, or the relevant section of it, can be translated. In many cases, a tailored approach meeting the individual facts of the case may be required. For example, if there is a dispute about the relevance and materiality of the requested document, but the party in possession is prepared to produce them (p. 99) provided it does not have to bear the burden of providing translations, then a possible compromise (or tribunal direction) may be that the requesting party carry the burden of translation. In either case, if the party preparing the translation is successful in the dispute it will be able to seek recovery of its costs of translation as part of its costs of the arbitration in the normal way.

d.  Confidentiality

5.93  Article 2.2(d) prompts the parties to consider issues relating to the level of confidentiality protection to be attached to evidence in the arbitration.

5.94  The IBA Rules deal with confidentiality at Article 3.13 and Article 9.4.57 Article 3.13 sets out an express obligation of confidentiality in relation to documents introduced into the arbitration and suggests that a tribunal may wish to issue an order setting out the terms of that confidentiality. Article 9.4 provides that a tribunal may, where appropriate, make arrangements for evidence to be presented subject to suitable and tailored confidentiality protection.

5.95  The tribunal’s power under Article 9.4 is most commonly exercised when a party has been requested/ordered to produce documents it claims are subject to some special commercial or technical confidentiality.58 However, this is not always the case. The nature of the industry in which the parties operate, or the nature of the dispute itself, may be such as to make it apparent from the outset that confidential material is likely introduced into evidence. In such circumstances it may be desirable for the parties, and the tribunal, to discuss as early as possible the confidentiality measures that may be appropriate.59

5.96  In all cases, the issue of confidentiality is something that should appear on a consultation agenda even if only to be dismissed by the parties as unnecessary. If an order addressing confidentiality in general terms is made early in the proceedings as part of the Article 2 consultation, it can be built upon by specific orders later made under Article 9.4 of the IBA Rules, as required. Points to consider at the outset of proceedings when the precise nature of the confidential documents likely to be introduced may not be known include:

  1. (a)  How confidential material introduced into the arbitration is to be identified;

  2. (b)  To whom the documents identified as confidential should be distributed in the first instance; and

  3. (c)  What provisional restrictions on access/copying should be put in place.

(p. 100) 5.97  Where the introduction of confidential material is considered likely, but the precise nature of that material is not yet known, there are dangers in being too prescriptive. The key points are:

  1. (a)  that the material should be clearly identified as confidential; and

  2. (b)  dissemination/copying should be restricted on a provisional basis while the case for, and nature of, confidentiality safeguards are worked out between the parties and tribunal.

Of course, in practice, many parties will prefer to withhold the material altogether until a tailored application under Article 9.4 has been made.

5.98  Additional confidentiality and data security issues may arise from the use of IT in the arbitration and additional levels of protection may be required to ensure that neither the parties nor any third parties (deliberately or inadvertently) misuse any data transmitted to/stored by them. For example, it is important to consider how the confidentiality and security of evidence will be maintained where that material is distributed to third parties in the normal course of the arbitration.60

5.99  A further point may sometimes arise where the parties are involved in multiple parallel disputes before different courts and/or tribunals, but the same underlying facts apply in each case. The parties may wish to agree that the confidentiality regime in the arbitration61 should not prevent the parties from using documents obtained in the arbitration in the parallel proceedings. For clarity, such proceedings can be defined precisely by case number and names of the parties.

e.  Efficiency, economy and conservation of resources

5.100  The purpose of the IBA Rules is to provide an efficient and economical process for the taking of evidence;62 thus, it is not surprising to see these words repeated in Article 2.2(e).

5.101  The point has been made that Article 2.2(e) adds very little to the opening words of Article 2.1, which expresses the whole objective of the consultation process as being to arrive at an efficient and economic (and fair) process.63 However, if Article 2.2 is to serve as a ‘default’ agenda for the consultation mentioned in Article 2.1, it seems to us that it does no harm to include express reference to considerations of cost and efficiency as an agenda item.

5.102  The inclusion of the phrase ‘conservation of resources’ in Article 2.2(e) is an interesting addition and the phrase is not seen elsewhere in the IBA Rules. It appears to be directed (p. 101) at conservation in the ecological sense.64 Examples of techniques that might be used to conserve resources include:

  1. (a)  exclusive use of electronic documents and electronic hearing bundles to prevent waste of paper, eg a decision that no letters or documents should be sent in paper form, and

  2. (b)  use of video conferencing for the examination of witnesses/experts if those individuals would otherwise have to travel by air to the hearing.

D.  Tribunal Identification of Material Issues and/or Discrete Issues Suitable for Preliminary Determination

  1. 2.3.  The Arbitral Tribunal is encouraged to identify to the Parties, as soon as it considers it to be appropriate, any issues:

    1. (a)  that the Arbitral Tribunal may regard as relevant to the case and material to its outcome; and/or

    2. (b)  for which a preliminary determination may be appropriate.

1.  Overview

5.103  Article 2.3 encourages the tribunal to identify for the parties any key issues for the presentation of evidence, or for preliminary determination, that the parties should consider in the context of procedural efficiency. However, in contrast with Article 2.1, Article 2.3 is not mandatory and leaves it to the discretion of the tribunal whether to implement its terms. As mentioned, there appears to be an inherent reluctance on the part of many tribunals to do so (see paras 5.10–5.12).

5.104  There are two elements to Article 2.3.

5.105  Article 2.3(a) is about the identification of issues that the tribunal may regard as relevant to the case and material to its outcome (see Chapter 6 for a discussion of what these terms mean). Equally importantly, the Tribunal may identify those issues that it does not consider to be relevant to the case or material to its outcome. The exercise is about identifying issues that the tribunal regards as being on the critical path to deciding the outcome of the case. The tribunal may want to encourage the parties to focus their resources on those aspects of the dispute and indicate that expenditure of time and costs on other aspects of the dispute may be wasteful of time and costs. The (p. 102) tribunal will wish to ensure that all of the evidence it will need to determine the dispute is available to it.

5.106  Article 2.3(b) is about the identification of issues that may be appropriate for preliminary determination. In substance, it encourages the tribunal to consider whether there may be threshold issues that could be dispositive of the entire arbitration or discrete issues that could usefully be addressed early in order to narrow or simplify other issues in dispute.

2.  Issues to Be Identified by the Tribunal

a.  Identification of issues relevant to the case and material to outcome

5.107  Article 2.3(a) encourages the tribunal to take a pro-active role in the identification of issues that it may regard as relevant to the case and material to the outcome. The term ‘issues’ is not defined but, in the authors’ view, the term is wide enough to encompass not only matters that have been pleaded by the parties in written submissions, but also any issues that the tribunal would need to consider when deciding the case, ie to flag for the parties where it expects the focus of their evidence to be. In practice, identification of these issues may be an iterative process.

5.108  Not all issues between the parties will be relevant and material to outcome. However, some tribunals may nonetheless look to identify as soon as possible issues between the parties that can be identified from the Request for Arbitration and Response to the Request. If requested, counsel for the parties should be prepared to draw up a list of those issues they believe to exist between the parties. From such beginnings, it is generally possible to reach a degree of consensus on the key issues that emerge. In other cases, it may not be appropriate to have this sort of dialogue until after detailed submissions have been exchanged. In all cases, the list of identified issues may need to be updated as the case progresses and new issues emerge, or as concessions are made on points previously in dispute.

5.109  The approach encouraged by the terms of Article 2.3 is accepted good practice in international arbitration. The UNCITRAL Notes on Organizing Arbitral Proceedings highlight the benefit of preparing a list of points in issue between the parties:

It is often considered helpful for the arbitral tribunal to prepare in consultation with the parties an indicative list of points at issue (as opposed to those that are undisputed) based on the parties’ submissions. Such a list, when prepared at an appropriate stage of the arbitral proceedings and updated as necessary, can assist the parties in focusing their arguments on the issues identified as critical by the arbitral tribunal, thereby improving the efficiency of the arbitral proceedings and reducing costs.65

(p. 103) 5.110  As mentioned, Article 2.3 allows the tribunal to direct the parties’ attention to any issues that the tribunal regards as relevant to the case and material to its outcome. In many cases, the parties will welcome this sort of indication from the tribunal as it allows them to address the issues directly in submissions or in evidence. In addition, relevance to the case and materiality to its outcome are the main tests for a tribunal when deciding whether or not a particular document or statement should be admitted into evidence.66 For parties who wish to seek non-voluntary document production, it is not easy to predict whether a tribunal will share their view of what documents are relevant to the case and material to its outcome. An early indication of these matters by the tribunal may provide greater clarity.

b.  Determination of preliminary issues

5.111  Article 2.3 also encourages the tribunal to identify possible issues for preliminary determination. If there is an issue that may have an impact on the overall claim or defence, it may be more efficient and economical to deal with it at an early stage in the proceedings – perhaps as a preliminary issue in relation to which the tribunal may issue a partial final award.67 Another example is a jurisdictional dispute which may warrant a preliminary hearing because if the tribunal finds it does not have jurisdiction, the time and expense of arguing the case on the merits will be avoided.

5.112  Another further example where early determination may be found appropriate is where a party raises a limitation defence. If, in a complex and significant dispute, the respondent pleads that the claims are time-barred, the entire proceedings may be an exercise in futility if the claim is ultimately dismissed on that ground. In the same way, issues of liability and quantum may be bifurcated. If liability has not been established, the tribunal will be relieved of the need to receive evidence on quantum.

5.113  Having identified a potential preliminary issue or the possibility of bifurcation, the tribunal will then need to consider whether a determination on that basis is the most efficient and economical way of proceeding. Matters that the tribunal may wish to consider (p. 104) include those usefully identified by (the then) Mr Justice Neuberger in Steele v Steele68 in the English commercial court. Those factors are:

  1. (a)  Whether the determination of the issue would dispose of the case or any aspect of the case;

  2. (b)  Whether the cost and time involved in pre-trial preparation would be significantly reduced;

  3. (c)  If the issue was an issue of law, what effort would be involved in identifying the relevant material;

  4. (d)  If an issue of law, how far it was to be determined on agreed facts, given that if there were numerous disputes the issue could probably not be safely resolved until the disputes were resolved;

  5. (e)  Whether the issue’s determination could unreasonably fetter the parties or the court in achieving a fair result at trial;

  6. (f)  The extent to which there was a risk that determining the issue would delay and increase the costs of the trial;

  7. (g)  How far the determination of the issue was relevant and the likelihood of it having to be determined by the court;

  8. (h)  The risk of the determination of the issue leading to an application for the amendment of pleadings in a bid to avoid the consequences of the determination; and

  9. (i)  Whether the determination was just and right.

5.114  Although Article 2.3 does not refer specifically to efficiency, economy, or fairness, as explained earlier, that is the underlying rationale for the whole of Article 2. As a result, the tribunal will need to consider very carefully whether carving out issues for early determination will actually save time and costs. Unfortunately, in some cases, the cost/benefit review required to assess these matters will be made difficult because, at an early stage, the tribunal may not have enough information about the dispute to be able to assess whether hiving off an issue will achieve greater efficiency.

3.  Timing of Identification of Issues by the Tribunal

5.115  Article 2.3 of the IBA Rules specifically requires the Tribunal to identify the issues mentioned there ‘as soon as it considers it appropriate’. Early discussion may be very important. For example, if a decision to bifurcate liability and quantum is not made early, the opportunity to do so efficiently may be lost. On the other hand—particularly in relation to identification of issues relevant and material to outcome—a tribunal may not wish to express a position too early for fear of being perceived as prejudging those matters. In other cases, the tribunal may not be in a position to actively participate in a discussion on determinative or preliminary issues because, until the parties have exchanged at least one round of written submissions, the tribunal is often in the dark as to the case (p. 105) before it and what issues are joined, or admitted. One commentary suggests that identification of relevant and material issues is best done later in the process:

The fact that the provision on identification of relevant and material issues is positioned within an article focused on early case management conferences gives the impression that such identification by the arbitral tribunal should happen very early in the case. In practice, however, it will often be better to identify the relevant and material issues later in the proceedings, at a time when the arbitrators know more about the case (e.g. before the hearing).69

5.116  In ICC arbitrations, unless the tribunal considers it inappropriate, the terms of reference to be drawn up must include a list of issues to be determined.70 While differing from the requirements of Article 2.3 in necessarily being done in the initial stages of the arbitration (rather than when ‘appropriate’), the Guidance on the ICC Rules acknowledges that the parties should identify questions of fact and law which, at the time of drafting the Terms of Reference, appear to be relevant and material to determining the parties’ respective claims. The tribunal and the parties are thus encouraged to single out the issues on which the case is likely to hinge, so as to give a greater focus to the arbitration proceedings.71 Despite this encouragement, and although the list of issues is not intended to be binding or exhaustive, in many cases the preparation of an agreed list of issues proves too controversial and so is not included.72 This may highlight the wisdom of the provision made at Article 2.3, which allows the tribunal to judge the right moment to identify issues for the parties to consider.

5.117  In our view, a tribunal should seek to strike the right balance between caution and proactivity. If identification of discrete issues suitable for preliminary determination is overly delayed, the opportunity to deal with the matter effectively may be lost. As to issues that the tribunal considers to be relevant and material, if the tribunal is not able/willing to identify such issues at the outset, it should nonetheless monitor the direction being taken by the parties in connection with the substance of document production and witness evidence in case some redirecting of that evidence is required.


1  1999 IBA Working Party and 2010 IBA Rules of Evidence Review Subcommittee, ‘Commentary on the Revised Text of the 2010 IBA Rules on the Taking of Evidence in International Arbitration’ (International Bar Association) 22 <www.ibanet.org/Document/Default.aspx?DocumentUid=DD240932-0E08-40D4-9866-309A635487C0> accessed 27 November 2018 (hereafter ‘Commentary on the IBA Rules’).

2  ibid 5.

3  Examples include ICC Rules Article 24; LCIA Rules Article 14; SCC Rules Article 28(1); SIAC Rules Rule 19; HKIAC Rules Article 13; and UNCITRAL Rules Article 17.2.

4  UNCITRAL Notes on Organizing Arbitral Proceedings (United Nations Commission on International Trade Law 2016) para 1(a) (hereafter ‘UNCITRAL Notes’) sets out the general principle of consultation between the parties and the arbitral tribunal. Effective Management of Arbitration: A Guide for In-House Counsel and Other Party Representatives (International Chamber of Commerce 2014) 13 (hereafter ‘ICC Guide to Effective Management of Arbitration’).

5  IBA Rules on the Taking of Evidence in International Commercial Arbitration 1999, Preamble 3 (hereafter ‘1999 IBA Rules’) states that: ‘Each Arbitral Tribunal is encouraged to identify to the Parties, as soon as it considers it to be appropriate, the issues that it may regard as relevant and material to the outcome of the case, including issues where a preliminary determination may be appropriate’. IBA Rules on the Taking of Evidence in International Arbitration 2010, Article 2.3 (hereafter ‘IBA Rules’) contains a stand-alone reference to issues suitable for preliminary determination.

6  The IBA Arbitration Guidelines and Rules Subcommittee, ‘Report on the Reception of the IBA Arbitration Soft Law Products’ (International Bar Association 2016) <www.ibanet.org/Document/Default.aspx?DocumentUid=105d29a3-6261-4437-84e2-1c8637844beb> accessed 27 November 2018.

7  Tobias Zuberbühler and others, IBA Rules of Evidence: Commentary on the IBA Rules on the Taking of Evidence in International Arbitration (Sellier European Law Publishers 2012) 18 (hereafter ‘Zuberbühler’; internal references are omitted).

8  Cypress Oilfield Holdings Limited v China Petrochemical International Company Limited Case T-5296-14 (Swedish Svea Court of Appeal, 19 February 2016).

9  For example, LCIA Rules Article 14.1 requires the parties to make contact as soon as practicable but no later than twenty-one days from the date of the formation of the arbitral tribunal.

10  Commentary on the IBA Rules (n 1) 5.

11  BCLP Survey on the use of the IBA Rules.

12  See, for example, Order 7170 of 1991 in Dominique Hascher, The Collection of Procedural Decisions in ICC Arbitration 1993–1996 (2nd edn, Kluwer Law International 1998) 24.

13  Chartered Institute of Arbitrators, International Arbitration Practice Guidelines: Managing Arbitrations and Procedural Orders 5.

14  For a more detailed discussion of the advantages and disadvantages of the different options see ICC Guide to Effective Management of Arbitration (n 4).

15  ‘Practice Guideline 17: Guidelines for Arbitrators Dealing with Cases Involving Consumers and Parties with Significant Differences of Resources’ (Chartered Institute of Arbitrators 2011).

16  Nassib G Ziadé, ‘Taking of Evidence in Arbitration: The Arab Experience’ in Andrea Carlevaris and others (eds), International Arbitration Under Review. Essays in Honour of John Beechey (ICC Publication No. 772E, International Chamber of Commerce 2015) 442. Ziadé goes on to make the point that ‘[i]n the end, irrespective of the evidentiary rules chosen by the parties, the tribunal retains full discretion to determine the relevance, materiality and weight of the evidence presented’.

17  Hans Smit, ‘Roles of the Arbitral Tribunal in Civil Law and Common Law Systems with Respect to Presentation of Evidence’ in Albert Jan van den Berg (ed), Planning Efficient Arbitration Proceedings: The Law Applicable in International Arbitration (Kluwer Law International 1996) 161–72, 164 (hereafter ‘Smit’).

18  Chartered Institute of Arbitrators (n 13) 3 (emphasis added).

19  Such duty may be a mandatory requirement of the law of the seat. For example, see the English Arbitration Act 1996, s 33; the Swedish Arbitration Act 1999, s 21.

20  LCIA Rules Article 14.2, and ICC Rules Article 22. See also ICC Rules Article 19.

21  One manifestation of this in extreme circumstances is the right (subject to any applicable mandatory provisions of law) of the parties by agreement to remove the arbitrator/s. For example, the English Arbitration Act 1996, s 23 (3)(a) expressly recognises the right of the parties jointly to revoke the authority of an arbitrator. In practice, the consequences of such action in wasted time and costs will militate against it. See further Robert Merkin and Louis Flannery, Arbitration Act 1996 (5th edn, Informa Law from Routledge 2014) 82.

22  ibid 132.

23  ibid 134 and fn 1.

24  Lord Justice Saville, ‘Departmental Advisory Committee on Arbitration Law 1996 Report on the Arbitration Bill’ (1997) Arbitration International 275 para 113.

25  ibid paras 154–59.

26  Julio César Rivera, Arbitraje comercial, internacional y doméstico (2nd edn, Actualizada Abeledoperrot 2014) 603.

27  The practice of producing multiple expert reports where one or none were necessary was one of the reasons for reforms in civil litigation in the English Courts. See: Doug Jones, ‘Party Appointed Expert Witnesses in International Arbitration: A Protocol at Last’ Arbitration International (2006) 24(1) 138.

28  IBA Rules (n 5) Article 9.2.

29  See for example: LCIA Rules, Article 20.3; SIAC Rules, Rule 25.2; and ICDR Arbitration Rules, Article 20.3. ICC Rules, Article 3(4) of Appendix VI (Expedited Procedure Rules) provides: ‘The arbitral tribunal shall have discretion to adopt such procedural measures as it considers appropriate. In particular, the arbitral tribunal may, after consultation with the parties, decide not to allow requests for document production or to limit the number, length and scope of written submissions and written witness evidence (both fact witnesses and experts)’. Interestingly, the UNCITRAL Rules and SCC Rules do not explicitly give the Arbitral Tribunal a right to exclude witness or expert evidence. See further Chapter 7.

30  IBA Rules (n 5) Article 4.10.

31  See Chapter 9.

32  See Chapter 7, paras 7.62–7.67.

33  The disadvantages of this approach in all but the most exceptional cases are dealt with in more detail in Chapter 7.

34  See Chapter 7, paras 7.68–7.75 and 7.127–7.136.

35  The advantages and implications of each approach are addressed at Chapters 8 and 9.

36  See Chapter 8, paras 8.22–8.24. This practice is adopted in some courts, for example, there is provision for the Singapore International Commercial Court to order that any question of foreign law be dealt with by way of submission. See: para 110 of the Singapore Commercial Court Practice Directions. See also David Foxton, ‘Foreign Law in Domestic Courts’ 2017 29 SAcLG 194 for an interesting discussion of domestic court practice.

37  See, for example: Christopher Harris, ‘Expert evidence: the 2010 revisions to the IBA Rules on the Taking of Evidence in International Arbitration’ [2010] International Arbitration Law Review 212, 215.

38  International Arbitration Practice Guidelines: Party-Appointed and Tribunal-Appointed Experts’ (Chartered Institute of Arbitrators 2016) 4 suggests that the following factors are relevant when considering the benefits of adducing expert opinion on law: (a) the degree of familiarity of the arbitrators with the applicable law and/or similar system(s) of law; (b) the degree of counsel’s competence in and familiarity with the applicable law and/or similar system(s) of law; (c) the extent to which the application of the law will impact on that issue and the likely effect this will have on the case; and (d) whether it involves general legal principles or some unique aspects of the applicable law.

39  Smit (n 17) 161.

40  If the IBA Rules (n 5) are adopted as binding rules, rather than being used as guidance only, the provisions of IBA Rules Article 4.7 will determine this issue unless excluded by agreement between the parties. See Chapter 7, paras 7.137–7.167.

41  Further guidance can be found in the ICC Arbitration Commission Report on Information Technology in International Arbitration (International Chamber of Commerce 2017) (hereafter ‘ICC Report on Information Technology’).

42  See further Zuberbühler (n 7) 17.

43  The Commentary on the IBA Rules (n 1) notes that, should the circumstances of the case make this appropriate, the tribunal and the parties may decide not to require disclosure of electronic evidence.

44  These provisions address the requirement of a sufficiently detailed description of the document/category of document requested by the other party, and address the format in which the document/category of document is to be provided. See Chapter 6.

45  ICC Arbitration Commission Report on Managing E-Document Production (International Chamber of Commerce 2012).

47  Brown v BCA Trading Ltd [2016] EWHC 1464 (Ch) endorsing the approach adopted in Pyrrho Investments Ltd v MWB Property Ltd [2016] EWHC 256 (Ch). In the latter case, the majority of the documents were held by the party wishing to use predictive coding. One of the factors that the court took into account when approving the use of predictive coding was cost. It was estimated that using predictive coding would cost around £130,000 compared to a possible cost of £250,000–£338,000 if search terms were used. For discussion on the use of search terms see Chapter 6, paras 6.68–6.75.

48  Moore v Publicis Groupe 11 Civ 1279 (ALC) (AJP) (US District Court SDNY, 24 February 2012).

49  Chapter 6, para 6.205.

50  See also further discussion on the use of Redfern Schedules at paras 6.199–6.207.

51  For more detail see paras 6.366–6.373; see also discussion on rights to production of metadata in paras 6.120–6.124.

53  Commentary to the IBA Rules (n 1).

54  BCLP Survey on the use of the IBA Rules.

55  ibid.

56  ibid.

57  See Chapter 6, paras 6.386–6.394 and Chapter 12, paras 12.317–12.356.

58  This is a ground of objection to production under IBA Rules (n 5) Article 9.2(e). If the tribunal does not find the grounds of objection compelling but recognizes the sensitive nature of the documents it may impose confidentiality safeguards. See Chapter 12, paras 12.317–12.356.

59  The nature and range of confidentiality protections that may be put in place is discussed in more detail in Chapter 12.

60  ICC Report on Information Technology (n 41). See also ‘Draft Cybersecurity Protocol for International Arbitration’ (Consultation Draft, ICCA/CPR/New York City Bar Association Working Group on Cybersecurity in Arbitration, 10 April 2018) <www.arbitration-icca.org/media/10/43322709923070/draft_cybersecurity_protocol_final_10_april.pdf> accessed 28 November 2018.

61  Even if a tailored regime has not been put in place pursuant to the IBA Rules (n 5) Article 9.4, the provisions of Article 3.13 will apply.

62  IBA Rules (n 5) Preamble.

63  Christopher Newmark, ‘“Efficient, Economical and Fair”: The Mantra of the New IBA Rules’ (2010) 13 International Arbitration Law Review 164, 167 (hereafter ‘Newmark’).

64  This is supported by the Commentary on the IBA Rules (n 1), which confirms that it refers to conservation of resources ‘which could include, by way of example, the economic and environmental costs of travel or document production . . . ’. See further Newmark (n 63) 167.

65  UNCITRAL Notes (n 4) paras 57, 58, and 68. A recent recommendation of the PCA Secretary General in ICSID case Vattenfall AB and others v. Federal Republic of Germany (ICSID Case No. ARB/12/12) emphasises that a tribunal may legitimately seek to complete gaps in the evidentiary records, and to ascertain the parties’ positions on particular points.

66  See, for example, the IBA Rules (n 5) Articles 3.3(b), 3.7, and 9.2(a).

67  Many national laws provide expressly that an arbitral tribunal has the power to make partial awards unless the parties agree otherwise. Examples include the English Arbitration Act 1996 s 47; Swedish Arbitration Act s 29; and Swiss Private International Law Statute Article 188. Most institutional rules also provide that the tribunal may make separate awards on different issues at different time. Examples include the LCIA Rules Article 26(1); ICC Rules Article 2(v); and SIAC Rules Rule 32.5. If the parties’ arbitration agreement were to expressly exclude partial awards and require a single award disposing of the entire dispute, that agreement must be given effect by the tribunal; otherwise, any award may be subject to annulment and non-recognition under the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 Article V(1)(d). See, for example, Assoc’d Corset & Brassiere Mfrs v Corset & Brassiere Workers 16 NYS2d 736, 736 (NY Sup Ct 1939), where the award of the arbitrator was void in that he failed to rule on all the matters submitted to him for determination and there was no consent to a partial award. In practice, it is rare for parties to exclude the possibility of partial awards in their arbitration agreements. However, from a practical perspective, it should be noted that some jurisdictions (eg Dubai) impose time restrictions on the arbitral process. This may make it impossible or inadvisable for a tribunal to deal first with a preliminary issue. Federal Arbitration Law Article 42(1) states that the arbitral tribunal shall issue the award by the date agreed by the parties and that if no date is agreed, the award shall be issued within six months from the date of holding the first hearing of the arbitration procedures. The six-month time limit can be extended with the agreement of the parties. The award can be annulled pursuant to Federal Arbitration Law Article 53(1)(g) if the time limit for rendering the award is not met.

68  [2001] 4 WLUK 500.

69  Zuberbühler (n 7) 19 (emphasis added).

70  ICC Rules Article 23(1)(d).

71  Jason Fry, Simon Greenberg, and Francesca Mazza, The Secretariat’s Guide to ICC Arbitration (International Chamber of Commerce 2012) para 3-849.

72  For more detail see ibid paras 3-850–3-851.