ARBITRATORS FEES AGAIN – EPISODE 2

Written by Graham Perry

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

18 July 2022

MEDIATION #261

Some arbitrators appointed to a long case will increase their hourly rate because they are prevented from accepting other appointments. Is this right? Some say ‘Yes’ citing the possible appointments that will slip by. Others say ‘No’ citing the market and the way things go. The considered view has to be to accept the situation, charge the normal rate + avoid the temptation to chase potential fees arising from other refused appointments. By all means include a cancellation fee in the event of settlement if time allocated has been shortened but such fees should not be something the parties need to take into account in deciding whether to finalise a settlement.

Arbitrators are professionals. They undertake training. They remain up-to-date with ongoing developments and do remain abreast of all cases focusing on arbitrators’ performance of their duties. We want to avoid being seen to chase every £/$. We need to be respectful + understanding of the vagaries of the arbitration process and the remuneration principles that it follows.

Time recording is an important aspect of an arbitrator’s work. We owe it to the parties to get this right. There are systems that can be used + some arbitrators are compliant. Others rely on a conscientious system of personal recording with the beginning + ending of a period properly recorded. This is easier if the particular work – eg reading defence submissions for example – can be clearly delineated. The position is less precise where there is an exchange of opinions on draft directions or a dispute between the parties that requires Tribunal intervention. In this case, the Chair should intervene and direct the time that should be included in arbitrators’ fees. This is, unfortunately, a minority view.

Chairs should lead. They should be in charge. Individual arbitrators may have a view but it is the Chair who speaks on behalf of the Tribunal. It is a skill for the Chair to be ahead and not behind and, where necessary, to take initiatives. Leadership matters.

NEXT POST 19 JULY 2022.

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