International Arbitration (Essay Sample)

International Arbitration
Name of Student
Name of Instructor
Name of Institution
Date Submitted
OUTLINE
1 Part One: Questions
* Question 1
* Question 2
* Question 3
* Question 4
2 Part Two: Counsel’s Memorial
* Introduction
* Statement of facts
* Statement of purpose
* Arguments
* Bibliography
International Arbitration
Part 1
Question 1: Importance of Severability in Arbitration
Severability is a term found in contract agreements that permits individuals or parties to leave out a component in an agreement which is perceived inappropriate or impossible to enforce. Severability is important since it will facilitate the other components to remain valid and hence to be enforced effectively. It is contained in arbitration law and it is a significant clause that defines the validity of any given contract. It is also referred to as saving phrase or clause in some literature. In this case, a contract will remain valid even after a portion of the contract is denounced later as invalid. This is a very important principle since it shows the motives of both parties when unenforceable clauses have been imposed on the contract. Provision of the said clause will be subjected to modifications in order to reflect the motives of the parties involved. As a result, the remaining clauses will proceed normally without any hindrances.[Margaret L. Moses, The Principle and Practice of International Commercial Arbitration (Cambridge: Cambridge University Press, 2008), 124.]
It is important to note that severability clause is very crucial in any arbitration procedure around the world. This is given the fact that the parties involved in the arbitration may encounter hurdles in the future that may compromise the fulfilment of some of the clauses in the arbitration agreement. The severability clause safeguards against such unforeseeable events.
If the severability clause was absent, it is noted that the entire contract may be regarded as invalid in the future if an incompetent clause is discovered. This is why the saving clause is important. Severability subjects the incompetent clause into scrutiny while the rest clauses are enforced as agreed between the two parties. This is an important clause since it allows the parties to insert a specific clause as far as consensus is concerned. This may happen when one of the parties is in need of an airtight arbitration concession. It may only target a particular paragraph of the contract and not the whole contract constituting the arbitration consensus.[Gary B. Born, International Commercial Arbitration (Cambridge: Cambridge University Press, 2006), 187.]
If an entire agreement is said to be invalid or unenforceable together with the severability clause, none of the parties will abide by the terms and conditions of the contract. The clause is used to prevent this by safeguarding the integrity of the remaining contract. Therefore, a severability clause is a significant principle in any given contract.
Question 2: Selection of a Seat in Arbitration
Introduction
Legal systems involved in the arbitration procedure must be familiar with the clause "seat of the arbitration”. In this case, the jurisdiction of the system is legally bound into the arbitration. The seat will clarify which state will carry out the procedure. For example, the seat of arbitration may not be in the same state or country but the parties in dispute may decide depending on the arbitration where the seat will be. The decisions may be reached with reference to provisions of the contract or with the parties' subsequent agreement. Only a single seat of arbitration exists. As a result of this, interference which may emerge due to lack of arbitration law will be avoided. As such, the seat is established to effectively carry out the jurisdiction.[Allan Redfern and Martin Hunter, Law and Practice and International Commercial Arbitration (London: Sweet & Maxwell, 1999), 112.]
It is important to note that it is not every time that the parties involved in arbitration come from the same region. In contemporary global world, it is noted that parties in arbitrations may be drawn from different countries around the world. This is especially so given the fact that international trade has become common place today. As such, one may find that a trader in Australia needs to enter into a contract with a party in another part of the word. If conflicts were to arise in such a case, it is noted that an international arbitration system is called for. The two parties have to decide on the arbitration seat. Additionally, the parties have to agree where the arbitrations are to be carried out. The selected location should be appropriate for the two parties. It is also important to note that the site selected should not favour one party over the other.
Importance of the Seat of Arbitration
As far as arbitration procedures are concerned, the seat of arbitration is an important factor informing the adoption of laws concerned. At this juncture, the courts of law will establish or conduct the arbitration. The participating parties in a given country will exercise laws attributed to arbitration as per the state. Incoherent laws in a given state will lead to inconveniences on the part of the parties as well as expensive transactions and most important, the proceedings will be affected greatly.[Julian M. Lew, Loukas A. Mistelis and Stafan M. Kroll, Comparative International Commerce Arbitration (Cambridge: Cambridge University Press, 2003), 3.]
Seat is very important in that it provides needed support as well as intervention measures as far as the arbitration proceeding is concerned. Autonomy of a given party is compromised by the administration of harsh conditions on the eligibility of arbitrators in question. Subsequently, the states or countries may have laws that are moderate in that they provide the parties with autonomy during the proceedings. In such a case, the courts cannot intervene and this increases the support given to the parties. For example, the interlocutory relief will be in abundance for parties in the said countries.
In the case of arbitral awarding, the intensity of awards may be disapproved or approved as per the seat of arbitration. This is so given that the courts involved in the seat of arbitration are the only ones with the mandate to welcome hearings of appeal attributed to arbitral awards.[Born, International Commercial Arbitration, 74.]
The choice of seat will affect the arbitral award given that it will inform the enforcement and reciprocal arrangement among the parties involved. This is especially so if it has the same position in other states.[Gary B. Born, International Commercial Arbitration and Forum Selection Agreement: Drafting and Enforcing (Cambridge: Cambridge University Press, 2010), 23.]
Lastly, seat of arbitration is important for issues related to infrastructure and convenience to allow proceedings to take place without any challenges. In places where the mentioned credentials are missing, the outcome of the arbitration will not be certain. Effective location of the seat of arbitration is paramount to avoid compromising the results.
In summary, it is noted that the seat of arbitration is usually decided upon a myriad of options. The operation of the local law should be put into consideration. This is together with the problems that may emerge in relation to the seat. This is important given that there may be need to solve more disputes that may occur during the proceedings. As such, the seat selected should be suitable to every party.[Jason Fry, Recognition and Enforcement of Foreign Arbitration Awards: A Global Commentary on the New York Convention (New York: Free Press, 2010), 78.]
Question 3: An Unsuccessful Arbitration Case
A statement is the plea made by a party in a case before the proceedings can take place. The person making the statement is referred to as a claimant. In such a case, the claimant outlines everything that he or she feels was unfair as far as their welfare is concerned. This is a very important document that pits the claimant against the respondent. Statements are supposed to be rational so as to facilitate backup. A claimant should therefore claim things that he or she can back up.[Born, International Commercial Arbitration and Forum, 123.]
It is noted that it is not all every time that both parties are satisfied with the outcome of arbitration tribunals. There are those parties who feel that their enemy has been favoured and the award is unfair to them. It is not uncommon to find such parties contesting the award made by the arbitration tribunal.
For the matter to proceed to the arbitration stage, the parties in question should submit the evidence as well as witnesses if possible. An evidenced form is mandatory. As the case proceeds just like in a normal court, the parties are asked to submit rebuttal evidence. To support their claims, all parties are also asked to call and cross-examine witnesses.
Many cases are lost when proof is not submitted to support the allegations made. It is important to note that winning a case is not solely dependent on how hard or passionately the arguments are made. This author feels that claimants who give statements without proof should be disregarded even if they might be telling the truth. A claimant will only be favoured by an arbitrator if they present truth that is factual. In some cases, the evidence is disregarded merely because it was not ".....designed into (a) proof”.[Lew et al., Comparative International Commerce, 77.] [Ibid.]
In the case of Mr. Smith, the case is a bit complicated. This is given the fact that the statement submitted by Mr. Schmidt is not valid since he lacks the documents to win the case. This is true gi...