Thursday, June 19, 2014

Selecting an Arbitrator - General Qualities

The selection of arbitrators can have a fundamental impact upon the success of an arbitral process. It is therefore important for the parties to have a clear appreciation as to the type of arbitrator they seek from the outset.

Pursuant to Oman’s Law of Arbitration in Civil and Commercial Disputes (the “Arbitration Law”), promulgated by Royal Decree 47 of 1997, as amended, in arbitrations where a sole arbitrator is to be appointed, parties are expected to co-operate in order to reach a consensus whereby all sides are satisfied that the appointee possesses the qualities which they covet. Failure to reach an agreement will result in the Omani courts imposing an appointment upon the parties. This, in itself, is to be avoided as far as possible. In situations where a tribunal is to be composed of three arbitrators, ordinarily, each party will nominate one arbitrator and those arbitrators will select the chairperson.

What general qualities should a party look for when determining whom to nominate as an arbitrator? This article sets out three general qualities, namely: (i) independence and impartiality as per Omani law; (ii) sound judgment; and (iii) good administrative skills.

(i) Independence and Impartiality as Per Omani Law

Put simply, arbitrators must be, above all else, independent and impartial. An arbitrator who does not act impartially and independently is unable to dispense with the exercise of good judgment and is incapable of rendering a fair (and enforceable) award. Whilst “independence” and “impartiality” form the cornerstone of most international arbitral processes, Omani law makes specific reference to these qualities.

Article 18(i) of the Arbitration Law provides that where there are doubts as to an arbitrator’s independence and impartiality, a challenge of the appointment may be made.

(ii) Sound Judgment

The second general quality would be “sound judgment”. It is the role of an arbitrator to decide a referred dispute and, in doing so, sound judgment will have to be exercised; it is important to understand that this is not merely limited to the dispute, but also in relation to all matters presented. Accordingly, the exercise of judgment will be required when deciding the outcome of procedural applications and jurisdictional challenges as well as weighing the evidence presented.

An arbitrator must, therefore, be discerning, capable of clear and logical thinking and able to consider evidence fairly, objectively and without emotion.

(iii) Administrative Skills

An arbitrator must possess good administrative skills, given that a tribunal must be able to plan, organise and control procedures in order to achieve a fair resolution of disputes referred without unnecessary delay or expense. The ability of an arbitrator to organise the proceedings and to manage time is critical if arbitration is to proceed effectively. In addition, leadership qualities are required in order to guide the parties in the right direction.

Aside from the general qualities listed above, parties are encouraged to review specific qualities. Relevant specific qualities will be the subject of a future article.