1. 1 Parallel proceedings in international arbitration Day 2 Arbitration AcademySpecial course Session 2012Prof. Gabrielle Kaufmann-Kohler

2. 2 Outline of today’s class 1.Res judicata and lis pendens 1.1 Res judicata Concept Requirements 1.2Lis pendens Concept and requirements 2.Consolidation 2.1Concept: Consolidation of proceedings distinguished from agregation of claims 2.2Requirements 2.3Illustration: Canfor v. USA 2.4 Limitations and assessment

3. 3 1.1Res judicata 1.1.1 Concept A dispute cannot be adjudicated twice General principle of law Art. III NYC: « Each contracting state shall recognize arbitral awards as binding […] ». Issue preclusion / estoppel v. claim preclusion

4. 4 Requirements bars re-adjudication provided there is triple identity: – identity of facts – identity of cause of action – identity of parties

5. 5 1.2 Lis pendens 1.2.1Concept and requirements –Corollary of res judicata when both proceedings still pending – Same identity tests

6. 6 –Defense before courts in Europe « 1. Where proceedings involving the same cause of action and between the same parties are brought in the courts of different Member States, any court other than the court first seised shall of its own motion stay its proceedings until such time as the jurisdiction of the court first seised is established. 2. Where the jurisdiction of the court first seised is established, any court other than the court first seised shall decline jurisdiction in favour of that court. » (Art. 27 Council Regulation (EC) N° 44/2001 [Brussels Regulation]) – Implies courts / tribunals of competent jurisdiction

7. 7 1.2.2Applicability in arbitration? – Only one arbitral tribunal of competent jurisdiction – E.g. “It [the arbitral tribunal] shall decide on its jurisdiction notwithstanding an action on the same matter between the same parties already pending before a state court or another arbitral tribunal, unless there are serious reasons to stay the proceedings.” (Art. 186(1)(bis) Swiss PILA) –Assessment

8. 8 2.3Related action / Connexity defense / forum non conveniens –Before courts in Europe « 1. Where related actions are pending in the courts of different Member States, any court other than the court first seised may stay its proceedings. 2. Where these actions are pending at first instance, any court other than the court first seised may also, on the application of one of the parties, decline jurisdiction if the court first seised has jurisdiction over the actions in question and its law permits the consolidation thereof.

9. 9 3. For the purposes of this Article, actions are deemed to be related where they also so closely connected that it is expedient to hear and determine them together to avoid the risk of irreconcilable judgments resulting from separate proceedings. » (Art. 28 Brussels Regulation I ) – Applicability in arbitration? – Assessment

10. 10 2.Consolidation 2.1Concept Consolidation of two / several pending proceedings into one As opposed to claims under different instruments (e.g. two contracts) brought in one arbitration – broad dispute resolution clause and compatibility of dispute settlement systems

11. 11 2.2Requirements – Commercial arbitration Article 10 ICC Rules 2012: Consolidation of Arbitrations a)the Court may, at the request of a party, consolidate two or more arbitrations pending under the Rules into a single arbitration, where the parties have agreed to consolidation; or b) all of the claims in the arbitrations are made under the same arbitration agreement; or c) where the claims in the arbitrations are made under more than one arbitration agreement, the arbitrations are between the same parties, the disputes in the arbitrations arise in connection with the same legal relationship, and the Court finds the arbitration agreements to be compatible. […]

12. 12 Article 4 SRIA 2012 : Consolidation and joinder 1. Where a Notice of Arbitration is submitted between parties already involved in other arbitral proceedings pending under these Rules, the Court may decide, after consulting with the parties and any confirmed arbitrator in all proceedings, that the new case shall be consolidated with the pending arbitral proceedings. The Court may proceed in the same way where a Notice of Arbitration is submitted between parties that are not identical to the parties in the pending arbitral proceedings. When rendering its decision, the Court shall take into account all relevant circumstances, including the links between the cases and the progress already made in the pending arbitral proceedings. Where the Court decides to consolidate the new case with the pending arbitral proceedings, the parties to all proceedings shall be deemed to have waived their right to designate an arbitrator, and the Court may revoke the appointment and confirmation of arbitrators and apply the provisions of Section II (Composition of the Arbitral Tribunal). […]

13. 13 2.2 Requirements - Investment arbitration Article 1126(2) NAFTA « Where a Tribunal established under this Article is satisfied that claims have been submitted to arbitration under Article 1120 that have a question of law or fact in common, the Tribunal may, in the interests of fair and efficient resolution of the claims, and after hearing the disputing parties, by order (a)assume jurisdiction over, and hear and determine together, all or part of the claims; or (b) assume jurisdiction over, and hear and determine one or more of the claims, the determination of which it believes would assist in the resolution of the others. »

14. 14 2.3An illustration: Canfor v. USA –Facts – Issue – Outcome

15. 15 2.4Limitations? Assessment?

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