ARBITRATION – FEES OF ARBITRATORS – EPISODE 3

Written by Graham Perry

Graham Perry M.A. Cantab FCIArb Experienced Arbitration Lawyer | China & Chinese Business Affairs | Public Speaker/Lecturer

4 July 2022

MEDIATION #254

The story so far. The Tribunal of 3 has a fees problem. An underperforming winger arbitrator (The Big Charger) is intending to charge at £350 per hour whereas the Chair is at £275 and the other winger is at £225. You, the other winger, are unhappy. The Big Charger has done little work, has made only a quite modest contribution to the Tribunal’s work. The Chair is uncomfortable but does not give a lead. You, emboldened by the S33 requirement that the Tribunal avoids “unnecessary expense”, write sensitively to the Big Charger (BC) proposing that his fees are the subject of discussion.

BC hits the roof + tells you that his fees are not a matter for you. A straightforward “mind your own business” response. You respond that BC’s fees do come within the S33 instruction. BC disagrees + argues that the drafters of the legislation did not have the fees of arbitrators in mind when they drafted the words “avoiding unnecessary expense”. They were thinking of the fees arising out of the appointment of too many experts, + legal fees including junior barristers.

An impasse has been reached. The Chair now gets busy. She is irritated by BC who has under-performed throughout the arbitration. Something has gone wrong. The Chair obtains permission from you to speak directly to the BC. The Chair meets BC privately in a near-by hotel. Much emerges. BC has encountered problems – a home extension has gone well over budget + an elderly relative has incurred significant residential care costs.

The Chair is sympathetic. The Chair likes BC + has worked with him over the years. But the Chair is also clear – fees are fees, + family problems are family problems. The two do not mix. They will also have a bad consequence as the fees may well be the subject of complaint by the parties, thereby forcing the administrators of the arbitration to act.

No agreement is reached. What next?

STANDING FIRM OR BACKING DOWN

Episode

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