Answer By law4u team
In arbitration, particularly in international disputes, situations may arise where a party requires immediate relief or protection before the full arbitration process can take place. Emergency arbitrators (EAs) are appointed to address such urgent matters, often providing temporary measures or orders before the tribunal is fully constituted. Emergency arbitrators are a recent but increasingly essential feature of arbitration, especially under institutional rules.
What is an Emergency Arbitrator?
Definition:
An emergency arbitrator is an independent third-party appointed by an arbitral institution or by the parties themselves to grant interim relief before the arbitral tribunal is fully constituted. This is especially useful when there is a need for urgent measures, such as injunctive relief or asset protection, prior to the formal commencement of the arbitration proceedings.
Role of an Emergency Arbitrator:
The primary role of an emergency arbitrator is to provide immediate, temporary, and urgent relief to a party who is facing potential harm while waiting for the full tribunal to be established. Common emergency measures include:
- Ordering injunctions to prevent actions like asset dissipation.
- Granting temporary restraining orders to maintain the status quo.
- Ordering interim payments or specific performance.
Difference from Regular Arbitrators:
Emergency arbitrators are distinct from regular arbitrators in that they are appointed before the formation of the full arbitral tribunal and are authorized to make interim decisions even before the arbitration hearings commence. Regular arbitrators, on the other hand, generally only have the authority to rule on the merits of the case and provide final awards once the full arbitration process is underway.
Powers of an Emergency Arbitrator:
Interim Measures:
Emergency arbitrators are authorized to grant interim relief that is usually in the form of orders intended to preserve the status quo, protect evidence, or prevent harm that could not be undone later. These measures can include freezing assets, issuing injunctions, or other temporary arrangements.
Binding Nature of Orders:
The order of an emergency arbitrator is usually binding on the parties, though its enforceability can depend on the jurisdiction. In most institutional arbitration rules, the emergency relief is considered to be an order that the arbitral tribunal, once constituted, may uphold or modify.
Limited Jurisdiction:
Emergency arbitrators are usually limited in their scope and powers, focusing solely on providing interim relief rather than ruling on the substantive issues of the case. Their jurisdiction is also restricted to the specific temporary issues at hand.
Procedural Aspects of Emergency Arbitration:
Institutional Arbitration Rules:
Most institutional arbitration rules, such as those of the International Chamber of Commerce (ICC), Singapore International Arbitration Centre (SIAC), and the London Court of International Arbitration (LCIA), provide for the appointment of emergency arbitrators. These rules often outline the procedures for requesting emergency relief and the timeline for appointment and issuance of orders.
Appointment Process:
An emergency arbitrator is typically appointed within a short timeframe after a party’s request for urgent relief, usually within one to two days. The process is faster than the formation of a full tribunal and ensures that the parties can obtain relief in a matter of days, rather than weeks or months.
Duration of Emergency Arbitrator’s Authority:
The authority of the emergency arbitrator usually ends when the full arbitral tribunal is constituted. The tribunal has the option to adopt, modify, or dismiss the emergency arbitrator’s order as it sees fit.
Enforceability of Emergency Arbitrator’s Award:
Court Enforcement:
In many jurisdictions, the decision of an emergency arbitrator can be enforced in the same manner as a court order, particularly if the award is in line with the country’s arbitration laws. However, the enforceability can vary depending on local laws and the nature of the relief ordered.
International Enforcement:
Emergency arbitral awards can also be enforced internationally under certain treaties or conventions, such as the New York Convention. However, since emergency arbitrator decisions are generally temporary and specific, they may face challenges in terms of long-term enforcement.
Benefits of Emergency Arbitration:
Quick Access to Interim Relief:
Emergency arbitration allows parties to obtain relief quickly and efficiently, avoiding unnecessary delays in the arbitration process. This is especially beneficial when immediate action is required to protect rights, assets, or evidence.
Flexibility and Efficiency:
Emergency arbitration provides a streamlined process for addressing urgent matters without waiting for the full tribunal to be constituted, enhancing the overall efficiency of the arbitration process.
Minimized Judicial Intervention:
Emergency arbitrators reduce the need for court intervention to obtain interim relief, thereby maintaining the confidentiality and autonomy of the arbitration process.
Example:
Scenario:
A global technology company, TechCorp, enters into a contract with a foreign supplier. The supplier breaches the contract by failing to deliver the necessary components, and TechCorp fears the supplier will dissipate its assets before the arbitration tribunal can be constituted.
Steps the Company Should Take:
Request Emergency Relief:
- TechCorp files a request for emergency relief under the SIAC Arbitration Rules, asking for an injunction to prevent the supplier from disposing of its assets.
Appointment of Emergency Arbitrator:
- Within 24 hours, the SIAC appoints an emergency arbitrator, who issues an emergency award ordering the supplier to freeze certain assets to preserve TechCorp’s rights during the arbitration.
Enforcement of the Award:
- The emergency arbitrator’s order is immediately enforceable in Singapore courts, and TechCorp can take legal action to freeze the supplier’s assets as directed.
Conclusion:
Emergency arbitrators are a vital tool in modern arbitration, particularly when swift action is required to prevent harm during the arbitration process. They provide a mechanism for obtaining interim relief, thereby allowing parties to protect their interests while awaiting the resolution of their disputes by a full arbitral tribunal.
