It is obvious that the remedies that are available under the arbitrator’s contract do not exactly accord with traditional contract remedies.
Its important to note that the arbitrator’s contract is a contract for the provision of services by the arbitrator who should be held liable on the basis of this contract at least, (if not under the general law of professional negligence) for breaches of this contract.
The following remedies will be examined below;
Remedies for breach of the arbitrator’s contract
The question is to know whether there are any consequences for breaches of the arbitrator’s contract by parties to it, and if there are, what remedies are available to the parties.
The breach of a term classified as a condition or a fundamental term will give the other party to the contract a right to terminate the arbitrator’s contract along with the right to claim dam ages. The right to terminate the arbitrator’s contract is exercised through another right, that of challenging the arbitrator. A successful challenge will terminate the arbitrator’s contract.
From arbitral practice, it appears that if the breach by the arbitrator is not of a fundamental nature, there may be no remedy available to the disputing parties, principally because of the peculiar nature of the service rendered by the arbitrator under this contract. This service is judicial and is usually accompanied by some degree of immunity, since the service is not strictly classified as a professional service.
Another reason for this lack of remedy against the arbitrator may be that the breach of such non- fundamental terms may not cause the disputing parties or institution to suffer any substantial loss, so that a claim may result in nominal damages being awarded.
Another difficulty encountered in pursuing a remedy for the breach of the arbitrator’s contract, is identifying the party that has suffered loss as a consequence of the breach. It is usually the disputing parties who suffer any resultant loss from the breach of the terms of the arbitrator’s contract. The arbitrator will only suffer loss where the disputing parties (or arbitration institution) fail or refuse to remunerate him for his service. In such situations, the arbitrator will sue either the disputing parties or institution on the basis of his contract for his fees under the arbitrator’s contract.
Generally, where a party is in breach of a contractual term, the party who has suffered damage as a result of such breach is entitled to a remedy. Under general contract law there are various remedies available against the party in breach including specific performance and award of damages. The autonomy or independent nature of the arbitrator’s contract is again evident in the analysis of the types of remedies available for the breach of its terms by its contracting parties.
- Remedy of specific performance
The remedy of specific performance will be the preferred remedy depending on the nature of the term breached. This remedy requires the restoration of the contracting parties to status quo ante. The major prerequisite to the grant of the remedy of specific performance is that the service to be performed can still be performed.
- Award of damages
Where the award of specific performance is no longer practicable, an award of money damages may be pursued. Where the disputing parties are in breach, for example failure to pay the arbitrator’s fees, the arbitrator can sue in a relevant court for his fees and interest on the amount. Some arbitration laws also make express provisions in this regard,
Remedies for breach of institution’s contract
The terms of this contract can only be breached by the institution and disputing parties and not the arbitrator who is not party to it. However, it is obvious that even where the institution contracts with the arbitrator as principal, certain actions of the arbitrator will affect the disputing parties directly
Add comment