Summary LLM International Dispute Resolution - International Commercial Arbitration I - Module 8 (National Courts in Arbitration)
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Course
LLM
Institution
LLM
Can national courts intervene in arbitration? What is the process before/during/after arbitration?
Who can parties seek interim relief from?
How can national courts take evidence/freezing orders/anti-suit injunction/anti-arbitration injunction?
Describe the evolving relationship between national courts and arbitration
In developed jurisdictions, arbitrators are no longer the inferior method of dispute resolution.
Thus most national courts prefer to conduct arbitrations by prioritising party autonomy and
respecting the parties’ right to oust the court’s jurisdiction. For example, the House of Lords
in Pioneer Shipping1 ruled that the parties can oust the national courts’ jurisdiction to
supervise the way in which the arbitrators apply the law. Thus there seems to be a clear
parliamentary intent to give effect to the turn of the tide in favour of the finality in the arbitral
award. Likewise, in the US, it was ruled in Hall Street2 that the US Federal Arbitration Act
should favour national policy favouring arbitration with just the ‘limited review’ by the
national courts needed to maintain the arbitration’s essential virtue of resolving disputes
immediately. UNCITRAL Model Law3 also requires that ‘no court shall intervene except
where so provided in this Law’ in matters governed by such law. Overall, most national
courts will aim to intervene only when it is necessary to do so in order to support the
effectiveness of the arbitration system.
Describe the three different stages of court intervention
The more advanced the proceedings are, the less powers national courts can exercise.
Before/At the beginning of the arbitration
This is when the national courts will have the greatest power to interfere.
With regards to the validity of the arbitration clause, they can do so in one of two ways. They
can directly review the clause as the main issue. For example, a party brings a declaratory
action and requests the court to determine if the clause is valid or request court assistance 4.
They can indirectly review the clause as a preliminary issue. For example, a party brings
court action on the merits5 and has to examine if the clause is valid.
Typically courts will ‘fully’ review a case where the arbitration law is not well developed.
For example, UNCITRAL6 and Convention7 provide that courts should refer parties to
arbitration if subject to an arbitration agreement, ‘unless it finds that the agreement is null and
void, inoperative or incapable of being performed’. This would not violate Kompetenz-
Kompetenz (tribunal’s jurisdiction over the dispute) because the court’s decision on its
jurisdiction removes any doubts regarding it, although the court’s review of the case would
encroach on its jurisdiction. Thus it eliminates the need for jurisdictional challenges at the
enforcement stage.
Whereas courts will conduct a ‘prima facie’ review a case where the arbitration is
more developed, before the arbitration commences or refrain from review after the arbitration
commenced.
However, there is no need to suspend the arbitration proceedings while the court
reviews the dispute. This is because of the multiple levels in the national courts, which could
1
Pioneer Shipping Ltd v BTP Tioxide Ltd (The Nema) (1981)
2
Hall St v Mattel (2008)
3
UNCITRAL Model Law, Article 5.
4
UK Arbitration Act, Section 32.
5
UK Arbitration Act, Section 9; UNCITRAL Model Law, Article 8.
6
UNCITRAL Model Law, Article 8.
7
New York Convention, Article II(3).
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