MARKET COMMENTARY 37
ARBI TRAT ION I S BE T T ER SUI T ED TO E VOLUT ION RATHER THAN TO RE VOLUT ION.
This brings us to the sanctions available to a tribunal to punish counsel’smisconduct, these are incorporated in themain body of the newRules (at Article 18.6), and provide for the following sanctions: (1) awritten reprimand; (2) awritten caution as to future conduct; (3) a reference to the legal representative’s regulatory and/or professional body; and (4) any other measures deemed necessary by the tribunal tomaintain its general duties as set out in Article 14 of the newRules. These sanctions do not appear to be especially punitive. A written admonishment would remain confidential between those involved in the arbitration andmay not act as a deterrent; and the power to refer counsel to the relevant professional or regulatory body for a clear breach of their professional code of conduct already exists. Indeed, the latter sanction is expressed in square brackets in the draft LCIA Rules, whichmay indicate a hesitation around its inclusion. In practical terms, the question is whether a party-appointed arbitrator would be prepared to impose sanctions on the counsel that appointed them if theywant to be appointed by the same counsel in the future. Indeed, even arbitrators who are not party-appointedmay hesitate to impose sanctions on counsel for risk of limiting future appointments. This is perhaps a controversial, but reasonable, question to pose when examining the development of a code of conduct for counsel in international arbitration. THE IBA GUIDELINES ON ‘PART Y REPRESENTATION’ Since their publication inMay 2013, these Guidelines have been regarded as fairly controversial. Nevertheless, the IBA Rules on the ‘Taking of Evidence’ were perhaps regardedwith asmuch scepticismupon their release, and are nowalmost universally adopted. Thus, the ‘Party Representation’ Guidelinesmay also reach the same level of ubiquity. The IBA Guidelines are fairly comprehensive; divided into seven parts consisting of 27 guidelines, with comments on how the Guidelines are to be applied. Some of themost salient principles set out are that a party representative: (1) should not engage in ex parte communicationwith the tribunal; (2) should not make any false statements of fact; (3) should inform the client to preserve documents relevant to the arbitration; (4) should not make a request to produce documents or object to a request for an improper purpose; (5) should not conceal documents; (6) should identify himself/herself and the party he/she represents before seeking any information froma potential witness or expert; (7) should ensure witness/expert reports reflect the witness/ expert’s own opinion; and (8) should not encourage or invite awitness to give false evidence. The sanctions available to a tribunal for counsel’smisconduct are: (1) admonishing the party representative; (2) drawing adverse inferences in assessing the evidence or arguments advanced by the party representative; (3) consideringmisconduct when apportioning the costs of the arbitration; or (4) any other measures deemed necessary by the tribunal “in order to preserve the fairness and integrity of the proceedings”.
HOW DO THE Y COMPARE? The powers to drawadverse inferences and apportion costs for counsel’smisconduct under the IBA Guidelines on Party Representation are fairly arduous. In comparison, similar measures are not included in the LCIA Guidelines; however, the catch-all remedy available to an LCIA tribunal to impose “any other measures deemed necessary” tomaintain its general duties, means that sanctions could be applied in appropriate circumstances. The other significant difference between the LCIA and IBA Guidelines is how they apply to counsel: in an LCIA arbitration proceeding under the newRules, a legal representativemust agree to complywith the Guidelines as a condition to appear by name before the tribunal; on the other hand, the IBA Guidelines can only govern counsel in an arbitration if the parties agree to opt in, as it is a voluntary code of conduct - a tribunal could also apply themafter consulting with the parties, but most tribunals would seek agreement before doing so. Finally, the IBA Guidelines are not “intended to displace otherwise applicablemandatory laws, professional or disciplinary rules”; and this is similar to themanner inwhich the LCIA Guidelines apply to counsel. Practically, thismeans that where counsel is subject to a strict code of conduct, the IBA guidelines should (theoretically) have little effect, assuming such codes of conduct tend to be followed; however, theymay help an inexperienced lawyer, or counsel froma developing jurisdiction, become familiar with the standards of conduct required in an international arbitration. CONCLUSION Some within the international arbitration community have long argued for a uniformcode of conduct for counsel. For example, Doak Bishop called for the “development and adoption of a uniformCode of Ethics for International Arbitration” at the International Council for Commercial Arbitration (ICCA) Congress in 2010, in Rio de Janeiro. However, until such a code is enacted, parties involved in arbitration under the auspices of an arbitral institution (other than the LCIA) that does not opt in to the IBA Guidelines will not be subject to an arbitration-specific code of conduct. Perhaps the answer to the way forward can be found in the closing speech given by Chief Justice SundareshMenon at this year’s ICCA Congress inMiami, when he said that arbitration is “better suited to evolution rather than to revolution”. With the introduction of the IBA and LCIA guidelines, we are seeing evolutionary steps in the development of a uniformcode of conduct for counsel in international arbitration; or, at least, a number of applicable codes. Other arbitral institutionsmay well follow the trend set by the LCIA and introduce their own codes of conduct, andmanywould argue that theywould be wise to do so. As Chief JusticeMenon remarked, international arbitration will respond to challenges, and evolve to what is best for its users and practitioners. A version of this article was first published in the Kluwer Arbitration Blog, May 2014
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