Arbitration Award Writing (Chapter 6)

• The arbitrator's decision relies on the evidence and submissions presented during arbitration
• The final award should reflect the arbitrator's assessment of opposing arguments and evidence
• The primary goal of an arbitrator is to determine the issues and their outcome, and make a legally binding judgement

Best Practices for Writing an Award

• Address all disputed issues raised in the arbitration
• Explain how each decision was reached
• Document the arbitration process and procedures followed
• Guarantee the process is equitable and fair

Chapter Focus

• This chapter outlines the necessary conditions for an award to be enforceable
• Identifying key issues and the reasoning process are vital parts an arbitration
• Proper award structuring will be explained

Learning Objectives

• Be able to explain the purpose of an arbitration award
• Be able to identify factors that threaten an award's enforceability
• Understand why using plain English is important
• Be able to identify critical legal phrases
• Know the governing laws affecting awards
• Know what is needed for an award to be upheld
• Include items that must be added to award outline

Purpose of an Award

• To document the arbitrator's decision on the disputed issues
• To inform all parties of the decisions made
• Parties must understand the arbitrator's reasoning
• Using easy to understand language is crucial when parties represent themselves
• The award can order payment or declare a decision on a particular matter

Resolving Disputes

• The award resolves the issues presented and nothing more
• All issues must be addressed
• An award informs parties of the arbitrator's decisions and any resulting actions
• Awards ordering payment must specify amounts and deadlines
• Compliance must be ensured and the award must be enforceable in case of court action

Informing Involved Parties

• The award will be reviewed by all parties involved
• All involved parties, including judges, must understand the arbitrator's reasoning and conclusions
• A well-reasoned award clarifies the decision-making process
• Awards that lack clarity are considered failures, and must be re-written

Mitigating Risk

• Awards should not create legal controversy
• Keep possible issues regarding jurisdiction and law in mind

Enforceability

• An enforceable award cannot be challenged under Article V of the New York Convention
• Refusal of enforcement can occur if:
• Parties lacked capacity or agreement validity
• Lack of notice or inability to present a case
• Decisions beyond the scope of submission
• Irregular composition/procedure of authority
• An award is not yet binding or has been set aside

Inability to Enforce

• An award may be deemed unenforceable by competent authority if:
• The subject is not arbitrable under local laws
• Enforcement defies public policy

Award Components

• Clearly outline the background and lead the reader through the arbitrator's reasoning to the final conclusion.
• Key details:
• Identity of parties & their relationships
• Contract details and dispute origin
• Appointment details, procedures, applicable laws
• Substantive issues and party submissions
• Arbitrator's findings, applicable laws and evidence
• Decisions of substantive matters
• Determine interest, if applicable
• Liability for fees/expenses for arbitrators, and party costs
• Directions, declarations, arbitrator's signature, date, and seat (international awards)

Plain Language Mandate

• Awards must be legally sound, using clear, relevant, concise, unambiguous language
• Avoid vague terms like "maybe," "should," and "might"

Key Legal Terms

• "Can" means 'is able' or 'is possible'
• "May" means 'is optional' or 'is permitted'
• "Shall" means 'must'
• "Will" indicates the future
• "He" refers to 'he, she, or it', including singular/plural
• "Defence" is a pleading responding to claims with admissions or denials
• "Claim" asserts a right from the contract
• "Counterclaim" is a claim opposing the referring party, independent of the original claim
• "Set-off" is a cross-claim used as a defence, diminishing the referring party's claim
• "Difference" is a sub-category of "dispute"
• "Dispute" means contention with opposing arguments

Court of Appeal Guidance

• In civil cases involving disputes, all circumstances must be examined
• Court of Appeal ruling stated disputes should be understood with their normal meaning
• Must be generally applied without lawyer interference

Requirements for an official Dispute

• A claim isn't a dispute unless not admitted
• Lack of admission can including rejection, discussions without agreement, prevarication or silence
• Time before silence can be an admission depends whether claim is controversial
• Deadlines to respond do not curtail reasonable time for a reply
• Disputed claims can be too nebulous for reaction

Other Definitions

• Arising out of has a inclusive definition, excluding only cases with no contract
• Arising under is more restrictive, including non-disclosure
• In connection with typically excludes rectification or damages from fraudulent inducement
• In relation to has similar restraints as in connection to
• In respect to covers disputes over breaches or circumstances affecting performance of an involved party
• Relating thereto is broad, covering allegations of contract termination through precedent conditions or non-disclosure
• Relative to has similar meaning as relating thereto
• With regard to has the same meaning as in respect of

Legal Requirements

• Key law and its affect on awards must be understood
• The nature of this is covered in Module One

Relevant Law

• Jurisdiction controls arbitration via arbitration legislation
• The law governs the entire arbitration including an award
• Arbitrators must act with fairness and impartiality
• They must provide proper opportunity, and not prejudice outcome

Valid Award Necessities

• An enforceable award needs compliance with statutes, NY Convention implementation, and general regulations
• All are classified as procedure or legal

Procedural Necessities

• Formal necessities come from legislation, rules and standards of best practice

Legal Necessities

• Typical obligations are as follows:
• Cogency which means the award being convincing
• Completeness means that all matters it covers being included
• Certainty means the ward being unambiguous
• Finality meaning no reopening of resolved issues
• Enforceability meaning the award can be enforced
• Jurisdiction meaning actions fall within arbitrator powers

Valid Reasons

• Arbitrators must provide reasons for their decisions per most laws and regulatory institutions
• Asking parties to clarify is normal when unsure, and good practice
• Providing reasons is important to show proper, logical process
• Simply stating preferred evidence isn't acceptable
• Arbitrators require enough available time to fully explain

Consequences

• Publishing an award without reason can have dire results in multiple governments
• It shows that either party can waive the right to appeal via Arbitration Act 1996

Communication Standards

• The institution submits the award to the parties upon finalizing the arbitration
• Arbitrators must release final decisions immediately
• Modern awards are commonly delivered electronically, with physical copies following

Correcting Mistakes

• Most rules allow clerical error fixed by arbitrator
• Arbitrators possess authority on request
• Fixes are specifically for accidents, it's rare they address poor choices
• The fact that the arbitrator fulfills all proper requests means the decision can't be overturned even if the mistake is left unfixed