Sydney Jacobs, Barrister at 13 Wentworth Chambers and Vikram Misra, Barrister at Clarence Chambers continue their series into arbitration and mediation. In Part 8, Sydney and Vikram examine the attitude of the Australian courts towards international commercial arbitrations by exploring the judgments in a number of cases. Follow their series here.
It will be recalled how, in our last article, we explored recent cases exemplifying the pro-international arbitration attitude of Australian courts. This of course is to be seen in the wider context of the pro-domestic arbitration policy of the courts.
The exhortation to “avoid the temptations of domesticity”, is attributed to Hon Mr Justice Croft, of the Victorian Supreme Court. His Honour repeated that phrase in a 2015 symposium paper, co-authored by the Hon Mr James Allsop, Chief Justice of the Federal Court of Australia, The Role of the Courts in Australia’s Arbitration Regime (viewed December 2019 on the Federal Court website and on Austlii) in saying as regards international arbitration:
“ …The “temptation of domesticity” concerns the intuitive appeal to a court of approaching matters for determination through the prism of legal doctrines and principles with which the court is most familiar. In the case of Australian courts, this, at the very least, means considering matters through a common law lens, if not going so far as to apply common law doctrines and equitable principles expressly. Like all temptation, such an approach is attractive in the short-term, but ultimately has the potential to interfere with broader, longer-term objectives. Chief among these long-term objectives is the promotion of international uniformity in international commercial arbitration practice. As the Chief Justice has already discussed, the international provenance of Australia’s arbitration regime necessitates an international judicial approach. As we have just heard, particular regard is to be had to the reasoned decisions of courts in other countries—particularly those in our region—where their arbitration law shares a common basis with that of Australia in the New York Convention and the Model Law. As such, courts must resist the temptation to approach arbitration related matters in the context of principles not found in these international instruments, and which may be peculiar to a particular jurisdiction or domestic legal system.”
What his Honour had in contemplation included process challenges based on denial of natural justice, of the type manifested in Cameron Australasia Pty Ltd v AED Oil Ltd [2015] VSC 163 (which involved a party’s attempt to enlist the court to review two procedural rulings made in course of the arbitration, viz not to allow a party to re-open its case so as to withdraw an admission of duty of care; and a decision to not permit a party to rely on a report of an expert, in circumstances where the party decided not to call that expert).
As Croft J observed extra-curially in 2015 in the article his Honour co-authored, The Role of the Courts in Australia’s Arbitration Regime (ibid):
“I rejected both grounds for setting the awards aside and found that Cameron was, in effect, attempting to pursue a merits appeal in the form of an appeal on questions of law. Indeed, the nature of Cameron’s arguments revealed that the purported grounds were simply appeals from determinations of the tribunal—to borrow the phrase used by the Full Federal Court in the TCL case, “dressed up”—as either complaints about the fairness of the arbitral process or as breaches of the agreed arbitral procedure.
I might add that invitations to intervene in the factual or legal merits of an arbitral award are not the only ways in which a court might be tempted by the comfort of domesticity. Indeed, temptation may present itself in circumstances where an award is yet to be rendered, or even where there is no arbitration on foot. Examples to which I will return later include applications seeking a stay of court proceedings and referral to arbitration, and applications for the issue of subpoenas to attend before or produce documents to an arbitral tribunal.”
His Honour then, in the article above, analysed the case concerning the Dutch Formula 1 driver, Mr van der Garda, Giedo van der Garde BV v Sauber Motorsport AG (2105) 317 ALR 792. Mr van der Garde was the beneficiary of a Swiss arbitral award, enjoining Sauber from certain conduct. Sauber challenged the award on public policy grounds, in essence that the terms of the injunction were not articulated clearly enough.
His Honour intimated in the above article that he gave short shrift to this argument, finding that the critical dispositive provision was not too vague or uncertain, nor was enforcement futile. His Honour added that the court was available to assist the parties in the event of any “doubt or difficulty” in this regard, and continued as regards the temptations of domesticity, as follows:
“Although not described explicitly as such, Sauber’s submissions on uncertainty and futility appeared to draw directly on equitable principles—principles which, despite their intuitive appeal to the common lawyer, are not found in the Model Law, or the New York Convention. In this context, it is important to remember that these international instruments constitute an amalgam of common law and civil law concepts. Clearly, the application of principles peculiar to one legal system has the potential to hinder the uniformity project which the Model Law exists to serve and which Australia’s arbitration legislation is unequivocally designed to support.”
With over 20 years’ experience as a barrister, Sydney Jacobs practices in the areas of commercial law and equity, real property and building and construction law. He has acquired experience in the area of easements: he has obtained easements for applicants and otherwise appeared in the cases listed below, has a number of current matters in the NSW Equity Division Real Property List being case -managed to final hearing 2018 and is briefed in certain easement matters being worked up for filing in Court. Prior to being called to the Bar, Sydney was a solicitor in the well -known firms listed below, as a commercial litigator with a construction law focus. Sydney has experience in acting for clients seeking or opposing easements and clients whose rights of way have been impeded by neighbours. You may connect with Sydney via email sjacobs@13wentworth.com.au or LinkedIn
Vikram Misra was admitted as a solicitor in 2012 and called to the NSW Bar in 2015. He maintains a broad commercial practice and is regularly briefed in matters relating to taxation law, property law, construction law and equity. Vikram has completed a Graduate Diploma in Taxation Law at the University of Sydney in 2015 and a Master of Laws majoring in construction law and contract law at the University of Melbourne in 2016. You may connect with Vikram via email counsel@vikrammisra.com or LinkedIn
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