ADVERSARIAL v INQUISITORIAL
Where are we? First, the Tribunal has invited the parties to comment on Sellers’ assertion that Buyers were in breach on 2 March 2021. Second, Sellers have responded + re-asserted their argument that Buyers were in breach of contract on the second day of the shipment period for not opening their L/C and, third, Sellers have warned the Tribunal that it has committed a serious procedural irregularity which will result in an application to the Commercial Court for Leave to Appeal.
The Buyers also respond + now argue that Sellers, not Buyers, were in breach by claiming default when Buyers still had time to open their L/C. Sellers wrongly repudiated the contract and their claim should fail.
The Tribunal considers the arguments + issues an award dismissing Sellers’ claim for damages because Buyers had time after 2 March to open their L/C. In Findings, you address the issue, provide details of your directions + the responses of the parties + give your reasons for dismissing Sellers’ claim. There is no internal appeal procedure + Sellers’ only recourse is to the UK Court under S 68 of the Arbitration Act.
Serious irregularity means an irregularity which the court considers has caused or will cause substantial injustice to the applicant – in this case Sellers will argue that, but for the intervention of the Tribunal, the date of default issue would not have arisen and their claim would have succeeded. In my view Sellers will fail because of the inquisitorial approach now urged upon arbitrators by the 1996 Act.
The question has been asked in correspondence – what does the Tribunal do if neither party picks up the point. I will address this point in the final episode tomorrow – 9 September 2021.
9 SEPTEMBER. FINAL EPISODE.