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Proceeding with an LMAA Arbitration

Are transcripts of hearings normally taken?

As a general rule, only in very large cases. However sometimes parties want a transcript for reasons of their own (e.g. where there are parallel or related proceedings going on before another tribunal). It is always for the parties to decide whether they want a transcript, and it is not normal for the tribunal to be involved in this decision or in making the necessary arrangements.

What is the difference between a third arbitrator and an umpire?

A third arbitrator is on an equal footing with the party-appointed arbitrators, though he will also chair the tribunal following his appointment.

An umpire has no status in terms of deciding anything until, if ever, the arbitrators disagree. If that happens, then – unless the parties otherwise agree, as often happens when the disagreement is about a procedural matter – the arbitrators drop out of the arbitration entirely (unless the parties request them to remain as advocates, which very rarely occurs nowadays in LMAA cases), and the umpire takes over the whole matter (not just those points on which the party-appointed arbitrators disagree) on his own.

Nowadays arbitration clauses requiring umpires instead of third arbitrators are less common. And where there is such a clause and a case goes to a hearing, the arbitrators will often ask the parties to consider varying the requirement so that a third arbitrator may be appointed. That way all three members of the tribunal can participate fully in the decision-making process. This is particularly advantageous when one or more of the members of the tribunal has some specialist knowledge or experience which is relevant, the benefit of which might otherwise be lost.

Does a party have to be represented by a lawyer in a London maritime arbitration?

No. Many parties conduct cases themselves. Some use claims agents, others use P&I Clubs. Many do, of course, use lawyers, and they may be from overseas. LMAA arbitrators are entirely accustomed to dealing with parties who are not represented by English lawyers and there is no detriment to parties who fall into this category. The reasonable charges of representatives of a party who is successful in arbitration will normally be recoverable, whether that representative is a lawyer or not or is English or not, provided that the party is liable for and has paid the charges in question.

When will an oral hearing be ordered?

It is impossible to generalise in answering this question. The factors to be considered are those set out in s.33 of the Arbitration Act 1996. In practical terms regard will be had to the complexity of a matter (more complicated disputes are sometimes more easily presented and understood in oral hearings), the need for oral evidence, whether the credibility of witnesses is in issue, whether expert evidence needs to be tested by cross-examination, and generally whether it seems likely that time will be saved by having a hearing.

Is an oral hearing necessary?

Certainly not! From s.34(2)(h) of the Arbitration Act 1996 it is clear that arbitrators are not bound to have an oral hearing, even if a party demands one. They are, though, bound by the general duties in s.33 of the Act, including acting fairly and impartially, giving each party a reasonable (note – not a full) opportunity of putting its case and dealing with the opposite case; and adopting procedures suitable to the circumstances of the dispute, avoiding unnecessary delay and expense and providing a fair means for resolving the matters to be determined. Sometimes these considerations lead to a conclusion that an oral hearing should take place.

However, something like 80% of the awards made by LMAA members are made on the basis of written submissions and documents only, i.e. without an oral hearing.

When and where do oral hearings take place?

A hearing will not be fixed until it is clear that it is appropriate to fix one and that the parties will be ready for whatever dates are under discussion, so plenty of notice is always given, taking account of the circumstances of the matter.

There are a number of places in central London that provide purpose-designed hearing rooms for arbitration (and other) hearings. The parties and the tribunal will normally liaise to reserve appropriate accommodation at one of these places.

Does a third arbitrator or umpire have to be appointed?

Although under the Arbitration Act 1996 (s.16(5)(b)), where a third arbitrator is required by an arbitration agreement he should be appointed immediately after the two party-appointed arbitrators have been appointed, the LMAA Terms 2021 (para. 8) do not require a third arbitrator to be appointed as long as the first two arbitrators are in agreement, unless a substantive hearing is to take place in which case one must be appointed before that occurs.

If an arbitration agreement requires an umpire, there is no need for an appointment in that capacity until the arbitrators disagree or a substantive hearing is to take place.

Can arbitrations be consolidated? If so, how?

The short answer is “yes, with the agreement of all the parties”: s.35 of the Arbitration Act 1996. However, it is important to note that arbitrators cannot order consolidation: only the parties may agree it. That happens fairly rarely.

What is more common is the holding of concurrent hearings under para.17(b) of the LMAA Terms 2021. It often happens that a string of related contracts (e.g. a head charter, a sub-charter and a sub-sub charter) throw up similar issues which will lead to one or more parties to a number of arbitrations applying for the power granted by para.17(b) to be used.

How does an LMAA arbitration proceed once the tribunal is appointed?

LMAA arbitrators accept appointment on the basis of the LMAA Terms 2021 which thus apply in almost all cases. The Second Schedule to the Terms sets out the procedure normally to be followed. It is designed to ensure a number of things. First, parties’ cases are to be “put on the table” as fully as is practicable at an early stage so that each knows what case it has to meet. Second, this is to be done in the most cost-effective and time-effective way possible. Third, parties are to try to agree between themselves matters such as extensions of time for taking various steps, and other procedural matters, so as to save time and reduce costs – including of course the arbitrators’ charges.

What happens if arbitrators do not agree?

It all depends on the arbitration agreement. If that provides for three arbitrators and a third arbitrator has not been appointed, then one must be appointed and, if necessary, a majority decision prevails – although if there is no majority then the decision of the chairman is dominant (the Arbitration Act 1996, s.20(4)).

If, however, the arbitration agreement anticipates two arbitrators and an umpire, and has not been varied, then any umpire who has been appointed already takes over the whole reference and the arbitrators drop out. And if an umpire has not already been appointed then one must be, and again he takes over the whole reference.

How should procedural applications be made in a London maritime arbitration?

In the first instance any such application should be the subject of an attempt to agree the position with the opposing party: see the LMAA Terms 2021, Second Schedule, para. 14. Only if agreement cannot be reached within the time prescribed should an application be made to the tribunal in accordance with the other provisions of that paragraph. Attention is also drawn to para. 19 of the same Schedule in respect of the likely costs consequences of inappropriate applications being made or not being agreed.

It is now common to communicate by email: ordinary post is often unreliable and should not be depended upon. However, it is not appropriate to send bulky documents (e.g. with many attachments) by fax, and it is even less desirable to send documents by fax and then also by post or courier.

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