Malaysia’s High Court rules that third parties are not prohibited from disclosing confidential documents produced in arbitration proceedings

In Dato’ Seri Timor Shah Rafiq v Nautilus Tug & Towage Sdn Bhd [2019] MLJU 405, the High Court considered for the first time the new section 41A of Malaysia’s Arbitration Act 2005 (“Arbitration Act“), and its application to non-parties to an arbitration.

Background

In the context of a shareholders’ dispute, the plaintiff-director of the defendant company applied for leave to commence derivative proceedings against the defendant company. The defendant company objected to the production of two documents annexed to the plaintiff’s affidavit supporting the application. These documents were originally produced for the purpose of arbitration proceedings between the defendant company and its corporate shareholders, Nautical Supreme Sdn Bhd (to which the plaintiff is a director) and Azimuth Marine Sdn Bhd.

Continue reading

India’s lower house of Parliament approves further amendments to the Indian Arbitration Act

As previously reported here, a draft Bill to amend the Arbitration and Conciliation Act 1996 (the “Act“) was approved by the Indian Cabinet on 7 March 2018 (the “Bill“). The Bill was listed as a part of the agenda for the monsoon session of the Indian Parliament and was passed by the Lower House on 10 August 2018, without any amendments. The text of the Bill can be found here.

The Law Minister has described the Bill as “a momentous and important legislation” aimed at making India “a hub of domestic and international arbitration”. The key features of the Bill are:

Continue reading

Observations on Arbitration: video for in-house counsel on the Myths and Realities of Arbitration

In this short video in our Observations on Arbitration series, Professional Support Consultants Vanessa Naish and Hannah Ambrose talk about the myths and realities surrounding the arbitration process.  The discussion draws out key points and common misconceptions about arbitration, touching on costs and duration, confidentiality, party autonomy, availability of interim relief, summary judgment and enforcement of arbitral awards.

For more information, please contact Vanessa Naish, Professional Support Consultant, Hannah Ambrose, Professional Support Consultant or your usual Herbert Smith Freehills contact.

Hannah Ambrose
Hannah Ambrose
Professional Support Consultant
+44 207 466 7585
Vanessa Naish
Vanessa Naish
Professional Support Consultant
+44 207 466 2112

Anticipated arbitration reforms in Australia

The Australian International Arbitration Act 1974 (Cth) (Act) applies to all international arbitration proceedings in Australia. The Civil Law and Justice Legislation Amendment Bill 2017 (Bill) is an omnibus bill which proposes to make certain amendments to the Act (as well as other various Australian legislation).

The International Arbitration Act incorporates the United Nations Commission on International Trade Law’s Model Law on International Commercial Arbitration (Model Law) and, much like other Model Law jurisdictions, contains additional provisions supplementing the Model Law. The proposed amendments to the Act are another effort by Australia to improve and clarify the provisions of the Model Law by addressing issues which have arisen in jurisprudence.

The key proposed change will make it easier for foreign awards to be enforced in Australia. A number of other less significant amendments are also proposed.

Continue reading

New Zealand considers further amendments to its Arbitration Act

On 9 March 2017, the Arbitration Amendment Bill (Bill) was introduced to the New Zealand Parliament. The Bill proposes to amend the Arbitration Act 1996 (Act), and follows recommendations by the Arbitrators’ and Mediators’ Institute of New Zealand (AMINZ).

The proposed changes include:

  1. permitting the inclusion of arbitration clauses in trust deeds;
  2. greater confidentiality of arbitration-related court proceedings; and
  3. narrowed grounds for the set-aside of an arbitral award.

Other amendments to the Act came into effect on 1 March 2017, which we earlier reported on here.

Continue reading

English Court considers unilateral communications between arbitrator and party and anonymisation of judgments related to an arbitration

In a recent challenge to an award made under s68 of the English Arbitration Act 1996, in Symbion Power LLC v Venco Imtiaz Construction Company the English Court considered the issue of unilateral communications between a party-appointed arbitrator and its appointing party. Further, and of particular interest to parties who choose arbitration to keep the resolution of their disputes confidential, the Court also addressed the circumstances in which a judgment resulting from an application to challenge an award may be published without anonymization of the parties' names. On this point, a party seeking to maintain confidentiality will need to be able to provide evidence of the positive detriment which it will suffer if the judgment is not anonymized. 

Continue reading

English High Court orders disclosure of arbitration documents by agent to principal

In its recent judgment AMEC Foster Wheeler Group Limited v Morgan Sindall Professional Services Limited & Ors [2015] EWHC 2012 (TCC) (available here), the English High Court (the Court) ordered that arbitration documents be disclosed by a party conducting arbitration to a party with a financial interest and practical involvement in the dispute.

The arbitration arose in relation to construction works at a naval base. The Secretary of State for Defence (SSD) had engaged a contractor (TES) to carry out works. Part of those works was subcontracted by TES to the claimant (AMEC). AMEC then sold its business to the defendants, who were assigned AMEC’s rights and agreed to carry out AMEC’s obligations under the relevant subcontract.

Disputes under the main contract and the subcontract arose, and arbitral proceedings between SSD and TES commenced. Under a name borrowing agreement between TES and AMEC (i.e. an agreement under which a party agrees to pursue or defend a legal claim in the name of another), AMEC, agreed to conduct the arbitration between TES and SSD on behalf of TES. AMEC and the defendants then agreed that the defendants would conduct the arbitration as AMEC’s agents.

The defendants conducted the arbitration without any involvement from AMEC. When AMEC sought copies of the arbitration documents, the defendants refused to provide them. The claimant brought proceedings before the Court for orders that the documents be disclosed.

The Court ordered that the documents be disclosed on the basis that they were held by the defendants as agent for AMEC. In reaching this decision, the Court rejected the defendants’ argument that disclosure should be refused on the basis that the arbitration documents were confidential.

The Court’s decision focussed largely on the relationship between the parties and little attention was given to the issue of confidentiality in arbitration proceedings. This in itself makes the decision noteworthy: the Court made clear that the legal obligation to provide the documents to AMEC (by virtue of the relationship between principal and agent) effectively ‘trumped’ any question of a duty of confidentiality owed to a third party (in this case, the SSD), in arbitration proceedings. Whilst the circumstances of this case were unusual, the decision may have broader application where there is an arbitration between an agent (whether disclosed or undisclosed) and a third party.

Continue reading