There are several potential benefits to contract parties selecting an arbitration clause to regulate possible disputes in a contract including matters of time, costs, the non-public nature of arbitration matters and the special expertise of arbitrators. But one of the fears sometimes perceived is the possible unavailability of any necessary (interim) injunctions or other measures to support arbitration proceedings and enforce any award. This fear is often not justified by the legal situation on the ground.
In terms of recognition of arbitral decisions, the New York Convention of 1958 will apply in the vast majority of cases. This international treaty has be signed and ratified by over 152 countries, including the most industrialised nations (*1) and provides for the recognition of out-of-jurisdiction arbitral awards by local national courts.
In relation to enforcement, courts in most countries will treat arbitral awards analogously to local court judgments. For example, in England the courts are granted statutory rights under the Arbitration Act 1996 to proceed to enforce arbitral decisions as if such were legal proceedings in a court of law. In particular, section 44(1) provides that
Unless otherwise agreed by the parties, the court has for the purposes of and in relation to arbitral proceedings the same power of making orders about the matters listed below as it has for the purposes of and in relation to legal proceedings.
Moreover, this power can also be applied to arbitral decisions originating outside of the court’s jurisdiction. Article 2(3) of the Act provides that the powers conferred under s.44 apply even if the seat of the arbitration is outside England and Wales or Northern Ireland and even where “no seat has been designated or determined.” It should be noted, however, that the Court has discretion to refuse to exercise such power if in its opinion the fact that the seat is outside the jurisdiction renders enforcement inappropriate in the circumstances.
In addition to the above, s.37 of the Supreme Court Act also applies to arbitration proceedings. This provision states that the High Court may grant an injunction wherever it appears “to be just and convenient.”
The result is the English courts have even recognised a power to issue a worldwide freezing order (WFO) requiring the “freezing” or seizure of bank accounts or other financial assets. This may also be done in the form of an interim injunction, pending a final decision in the main proceedings. The discretion of the court to issue a WFO is exercised generally only if all relevant circumstances and options have been considered, there is a risk of dissipation of assets, and there is a real prospect that the assets are located within the jurisdiction of the foreign court in question. (*2)
What your hear and what you write…
…are not infrequently quite different in Legal English. Why torture your language skills about deficiencies (“dee fish in sea”) when you can have simple defects or faults. Why do lawyers always pronounce in lieu as “in loo”?
Well, the whole thing gets much worse when you mix in national and regional dialects, accents and pronunciation. For example, if you ask an Australian lawyer about libel (Beleidigung), because of the Australian way of pronunciation you may be understood to be referring to some sort of tag (label)!
If you want to learn Australian (“Strine”) pronunciation a good place to start is a book entitled Let Stalk Strine by Afferbeck Lauder (= alphabetical order) aka Alastair Ardoch Morrison. Mr Morrison died in 1998 but his pronunciation guides live on and you can even find him in Wikipedia.
Here are a few examples for your future antipodean legal conferences:
“Emma chisit” – How much is it?
“Egg nishner” – air conditioner
So, tie your kangaroo down, mate –and give it a fair go!
(*1) for the current status of the New York Convention and other information see http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/NYConvention_status.html
(*2) see, for example, Dadourian Group International Inc v Simms (No 1) [2006] 1 WLR 2499