ARBITRATION #174
You consult with your Wingers. Sellers’ appointed arbitrator argues that your action is favouring Buyers and, if Buyers do not raise the issue, then it is not for the Tribunal to raise the issue. Buyers’ party-appointed Winger, however, agrees with you.
So the question is – Are you favouring Buyers or are you merely applying S 34(2)(g)? Do you decide not to ascertain the law of default because, by doing so, you will be helping Buyers + hindering Sellers? Under the Old Adversarial Approach, you would have had to be silent. Under the New Inquisitorial Approach, you have to ascertain the law.
Some readers of this column will say that neither of the parties has raised the law of default so why do you need to ascertain it? The answer is that the law of default has been relied upon by Sellers and Sellers will benefit from an award of damages. But Sellers are wrong. They repudiated the contract by prematurely placing Buyers in default. If you are silent, you become a party to the fundamental misapplication of the law of default. Is that something that you should be doing?
So, to the directions. “The Tribunal notes that the shipment period in this contract is March/April 2021 and that Sellers placed Buyers in default on 2 March 2021. The parties are invited, within 7 days, to comment to the Tribunal (with a copy to the other side) on Sellers’ claimed date of default.”
You have brought the issue into the open. Sellers, in response, focus on the date of default + justify their action. However, they go further + comment critically on the directions and warn that the Tribunal is committing “a serious irregularity”.
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