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Fees – FAQ

Are arbitrators’ fees payable in advance?

Not normally, although an appointment fee is payable at the outset.

However, arbitrators may ask for interim payments as work progresses on a case: see section (B) of the First Schedule to the LMAA Terms 2021. Further, when an oral hearing is fixed, booking fees will become payable and are not refundable depending on certain conditions

Further, under section (E) of the First Schedule to the LMAA Terms 2021, arbitrators may ask for security for the costs of awards before they proceed to consider papers in the case of a documents-only matter or before they sit at an oral hearing.

Who has to pay booking fees?

They are payable by the party asking for the hearing or by both in equal shares if both ask for it to be fixed: see section (D) of the First Schedule to the LMAA Terms 2021.

What happens if booking fees are not paid?

Arbitrators will not continue to reserve dates that may have been provisionally reserved unless booking fees are paid on time.

What happens if an arbitration is settled?

About 80% of all arbitrations that are started are settled in due course. It is entirely up to parties what agreement they reach between themselves. They should, though, remember to provide for the tribunal’s charges.

If a settlement agreement is reached but is not implemented, the question whether the tribunal retains any jurisdiction, and if so what, has to be determined by reference to the agreement. If it is silent on the topic, then the tribunal will have no powers to enforce it or to proceed to an award: it must be up to a Court to enforce or to provide a remedy for breach of the agreement. Sometimes settlement agreements provide that if they are not complied with the tribunal shall have power to make an award in accordance with the agreement, or to continue with the arbitration as if no agreement had been reached, and other formulae are possible.

What are booking fees?

Booking fees are payable under section (D) of the First Schedule to the LMAA Terms 2021 before dates will be booked firm for a hearing. They have to be paid 6 months before the hearing starts, or within 14 days if the dates are being fixed at less that 6 months’ remove. They are refundable as to 50% if the hearing is cancelled more than 3 months before the start date, but are forfeit thereafter. The current basic rate is £1,250 per arbitrator per day booked, subject to the length of the hearing. They are payable by the party asking for the hearing or by both in equal shares if both ask for it to be fixed.

What fees do LMAA arbitrators charge?

On appointment a standard fee is payable.

Thereafter charges are based purely on the time spent on a case, i.e. on the work that the arbitrator has to do.

Booking fees are payable in advance when a hearing is booked, and the LMAA Terms 2021 (First Schedule) contain provisions as to these, including as to the extent to which they may not be refundable.

Who is liable for arbitrators’ charges?

The parties are jointly and severally liable, although appointment fees are payable by the appointing party. Where an award is made it will usually direct which party is liable for the costs of it, which will generally be the tribunal’s charges; but that is only a determination of liability as between the parties – the joint and several liability of the parties to the tribunal remains. Similarly when parties compromise a dispute they should and normally do agree as to how the tribunal’s fees are to be met, but again that does not affect the entitlement of the tribunal to look to the parties jointly and severally if the fees are not paid.

Do I have to pay the arbitrator a fee on appointment?

Yes. Under the LMAA Terms 2021 a standard appointment fee, currently £350, is payable to an arbitrator on his appointment. That covers his charges for accepting appointment and opening a file. Further work thereafter is charged for on a time basis.