Lisbon Court of Appeal | Impartiality and Independence of Arbitrators | Challenge of Arbitrator | 24-03-2015 | Case #019

Lisbon Court of Appeal
Date: 24-03-2015
Case Nr. 1361/14.0YRLSB.L1-1
LINK DGSI

Headline:

Arbitrator can be disqualified for being repeatedly appointed by same party/law firm if the circumstances in question give rise to justifiable doubts.

Provisions under IBA Guidelines on the Conflict of Interest in International Arbitration 2004, Orange List (3.1.3, 3.1.5 and 3.3.7) were referred to.

 

Summary:

  1. The application for the challenge of an arbitrator shall be considered to be made in a timely manner if it is filed within 15 days after the challenging party becomes aware of the facts that support the challenge.
  2. It is the arbitrator’s duty to disclose all circumstances which might give rise to reasonable doubts as to their impartiality and independence.
  3. The omission of the duty of disclosure, by itself, does not necessarily imply that there is a lack of independence and impartiality of the arbitrator.
  4. Independence and impartiality must be (and has been in this case) assessed in the light of the specific circumstances of the case under consideration. This is also true when determining whether the repeated appointment of an arbitrator by a party or law firm would cause doubts to his independent and impartiality.
  5. In this case, it was found that there were ‘founded doubts’ to the independence and impartiality of the arbitrator. The appointment of the same arbitrator in the previous 3 years- by the same law firm, in arbitration proceedings required in disputes covered by Law no. 62/2011, in about 50 arbitrations; including in 19 of them, where the appointment came from the same party and / or its subsidiaries, and in respect of the same active substance. These were considered to be circumstances that, in the “eyes of the parties” which were unaware of them, and are likely to create founded doubts about the independence and exemption of the arbitrator.
  6. Reference was made to the IBA Guidelines on the Conflict of Interest in International Arbitration, 2004 as a soft law source used to help determine what circumstances may give rise to justifiable doubt.
  7. The IBA Guidelines on the Conflict of Interest in International Arbitration, 2004 cannot be used in abstract, and must be integrated with the facts of the case. Non-disclosure of an item listed in the Orange List does not automatically mean that the arbitrator is dependent on a party.
  8. Reference was made to items 3.1.3; 3.1.5 and 3.3.7 of the Orange List of The IBA Guidelines on the Conflict of Interest in International Arbitration, 2004.

 

This case summary was kindly prepared by Sameer Thakur (sameerthakur@live.in, NALSAR University of Law), Rishabh Raheja, (rishabharaheja@gmail.com, NALSAR University of Law), and Abhishek Babbar (abhishekbabbar1996@gmail.com).

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