This post provides an insight into the procedure of evidence collection in the arbitration proceedings analysing the sources of procedural powers that provides and addresses the shortcomings. The conclusion provides for suggestion in regard to the involvement of the domestic courts in the evidence collection procedure and simultaneously balancing the autonomy of the arbitral tribunal.

There is a significant medley of intercession between arbitral tribunals and courts, at every juncture of arbitration proceedings. The intercession is the most significant in the procedure of collection of evidence. In the milieu of international arbitration, it is often agreed that the appointed arbitral tribunal is commanding the decision on issue of evidence. The sources of this procedural power are as follows:

Arbitration Agreement

The mutual agreement between the parties is the root cause of arbitration and hence, the principles that govern the evidence collection would usually be governed by the agreement.[1] In conjecture, the parties can include provisions on availability, scope and timing of disclosure in the agreement.

The UNCITRAL Model Law and National Laws

The UNCITRAL Model Law on International Commercial Arbitration emphasizes party autonomy under Article 19(1). Further, Article 19(2) provides for tribunal to conduct the proceedings in the manner it considers appropriate in case of absence of guidance from the parties. The model law also provides that the tribunal can seek assistance from the national courts for the evidence collection under Article 27.

In absence of any provisions in the agreement, the rules governing the collection of evidence in international arbitration would generally be the ones applicable to proceedings at the seat of the arbitral tribunal.[2]

For example, the United States (US) Federal Arbitration Act provides that the arbitrators may summon in writing any person to attend as a witness and bring with him the documents about the case if the arbitration seat is in the US.[3] Similarly, the Indian Arbitration and Conciliation Act, 1996 under, section 19 (3) provides that the tribunal may conduct the proceedings in the manner it considers appropriate and section 19 (4) provides the tribunal the power to determine the admissibility, relevance, materiality and weight of any evidence.

Institutional Rules

The rules of evidence collection are provided in the arbitration institution’s rules that are elected by the parties and these are mandatory in nature.

For instance, the ICC rules provide that the tribunal may adopt the procedural measures after consulting the parties. Similar provisions are provided for in the London Court of International Arbitration Rules, Hong Kong International Arbitration Centre Rules, and Singapore International Arbitration Centre Rules. The American Arbitration Association Commercial Rules and the ICDR Rules expressly provide for arbitrator’s power in regards to the collection of evidence.

International Bar Association Rules

The national laws and institutional rules recognized the powers of arbitrators to govern the evidence collection, they have provided less guidance regarding the procedures and principles to be applied to tackle the issues of evidence production. Arbitrators have worked on defining a common platform relating to evidence collection which has been edited by the IBA and is referred to as the IBA rules on the taking of evidence in international arbitration. These rules have been considered as a balanced compromise between common and civil law countries, and are merely supplemental and only to fill the gaps intentionally left.

Shortcomings

The positive strands are counterpoised by obvious shortcomings which justifies the resort to domestic courts by the arbitration practitioners before or during the proceedings to solve indubitable issues relating to evidence collection.

The first limitation is that the arbitral tribunals have no access to third parties concerning the collection of evidence. The well-established rationale behind this rule is that “consent” is rooted in arbitration.[4] Hence, the tribunal may usually lack jurisdiction for the production of the documents over third parties and will have to seek assistance from local courts for the same.

The second issue is in regard to the effectiveness of the arbitral tribunal’s power to obtain documents or witness testimony when the party refuses to obey the tribunal orders to produce documents or ensure the attendance of a witness. The remedy so provided for such instance is “adverse inference”, as per the IBA Rules, which bestows that document or relevant evidence “would be adverse to the interests” of the party, when the party “without satisfactory explanation” failed to produce it on the following request for production to which it did not object, or an order by the tribunal to produce. This adverse inference can have a negative impact on the arbitral award. National laws have built in solutions, and allowed for certain specific measures to deter the party from combating disclosures.[5] It has been noted that the penalties have been ineffective, as the tribunal has no power for the enforcement of the penalty except through the arbitral award.[6] The general picture is that, nothing “in the UNCITRAL Model Law, the US Federal Arbitration Act, the Swiss Law on Private International Law or other leading arbitration statutes empowers arbitral tribunals to impose fines or other penalties on either parties or non-parties to international arbitration”.[7]

The third and consequential limit is the risk of destruction of evidence even before the tribunal is formed. The major snag that comes with the transparent and adversarial process for disclosure is that the party can get rid of unpropitious documents on receiving the request of production or even before the constitution of the tribunal. The absence of ex parte proceedings makes this supposition defensible.

These weaknesses have led parties to seek assistance from the domestic courts to solve certain circumstances and allow for the smooth functioning of the arbitration proceedings as all the evidence available will be hoarded and preserved. One will always catechize the recourse to domestic courts to be at odds with the parties’ intention to arbitrate and such proceedings will not form part of spurious effort to outmanoeuvre their quotidian choice for an out of the court proceedings.

Conclusion

International arbitration is designed on a universal scale, with constant reciprocity between arbitral tribunals and domestic courts. The collection of evidence is not an oddity to the existence of a close and indirectly systematic relationship between the arbitrators and the Judges. In regard to the collection of evidence, the domestic courts should provide for the assistance in the matters of evidence pinpointed in their jurisdictions. This assistance so provided should take the balanced approach into contemplation which has been desired by the arbitration practitioners over the course of time. The arbitration should be in the centre of all proceedings with the arbitration and the submissions before the domestic court can be done so only if the tribunal agrees. This is to be done so in order to take cognizance of the decision of the parties for an out of court proceedings.

AUTHORS’ BIO:
Isha B D is currently a 4th-year B.Com L.L.B student at the Institute of Law, Nirma University.

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[1] Gary Born, International Commercial Arbitration (Kluwer Law International, 2nd edn 2014).

[2] Carine Dupeyron, ‘Shall National Courts Assist Arbitral Tribunals in Gathering Evidence?’ in Andrea Menaker (eds), International Arbitration and the Rule of Law: Contribution and Conformity, ICCA Congress Series (19 Kluwer Law International; ICCA & Kluwer Law International 2017).

[3] ‘9 U.S.C. § 7.

[4] Alan Redfern & Martin Hunter, Law and Practice of International Commercial Arbitration (Sweet & Maxwell 4th edn 2004) 319. See also Gary B. Born, International Commercial Arbitration (Kluwer Law International, The Netherlands 2009) 2343.

[5] French CPC, Art. 1467(3). See also, Belgium Judicial Code, Art. 1007(4).

[6] Christophe Seraglini & Jérôme Ortscheidt, Droit de l’arbitrage interne et international (LGDJ Montchrestien, 2nd edn 2013) 770.

[7] Gary Born, International Commercial Arbitration (Kluwer Law International, The Netherlands 2009) 2388.