MEMORANDUM FOR RESPONDENT - Pace University

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QUEEN’S UNIVERSITY FACULTY OF LAW reappointed Mr. Y [Ltr. 13 August 2010]. The Milan Rules do not contemplate the reappointment of an arbitrator previously denied confirmation. Accordingly, Mr. Y’s reappointment did not give rise to the Council’s authority to appoint a substitute; Mr. Y was not a replacement arbitrator. The Council acted outside its authority in appointing Mr. Z. 2. The Council should have invited the party-appointed arbitrators to make another appointment. 15. The reappointment of Mr. Y did not warrant direct intervention by the Council. Instead, the Council should have invited the party-appointed arbitrators to make a new appointment. The Council should respect the Parties’ intentions to have the party-appointed arbitrators appoint the presiding arbitrator. This would facilitate cooperation between members of the Tribunal [Moses 125]. Furthermore, the appointment procedure chosen by the Parties gives the Parties an indirect influence on the selection of the presiding arbitrator [Lew et al. 250]. The Parties’ mutual intentions should not be abrogated merely because the Milan Rules do not address the situation before the Tribunal. None of the other bases that might justify the intervention of the administering institution were present here. Neither party was attempting to delay or frustrate the arbitral proceedings [Luttrell 3; Gaillard/Savage 483, 554; Lew et al. 318]. Instead, the party- appointed arbitrators were exercising their delegated authority to appoint a presiding arbitrator. Faced with a situation not contemplated by its Rules, the Council should simply have abided by the Parties’ Agreement and given the party-appointed arbitrators another opportunity to select a new presiding arbitrator. II. <strong>RESPONDENT</strong> DID NOT WAIVE ITS RIGHT TO OBJECT TO THE JURISDICTION OF THE TRIBUNAL. 16. Claimant may argue that Respondent waived its right to object to the jurisdiction of the Tribunal. The Tribunal should find that Respondent raised a valid objection; the waiver conditions in the Parties’ Agreement have not been met. According to the Parties’ Agreement, an objection must be raised “in the first brief or at the first hearing following the claim to which the objection relates” [art. 12 2010 Milan Rules] or, under the Model Law, “without undue delay” [art. 4]. Accordingly, to find a valid waiver, a party must know of the non-compliance, proceed to arbitration and fail to state an objection without undue delay [Binder 55]. These requirements have not been met. Respondent was unaware of the improper constitution of the Tribunal when it submitted its Statement of Defence [A]. The time between the improper constitution and Respondent’s objection does not amount to undue delay [B], and Respondent’s objection is not disruptive of the proceedings [C]. Respondent acted within its rights to object. 6
QUEEN’S UNIVERSITY FACULTY OF LAW A. Respondent was unaware of the improper constitution of the Tribunal when it submitted its Statement of Defence. 17. To invoke art. 4 Model Law, Claimant must first establish that Respondent knew of the non- compliance with the Parties’ Agreement and still proceeded with the arbitration [Binder 59]. Claimant may argue that Respondent waived the right to object by not objecting as soon as Mr. Y was denied confirmation [Ltr. 2 August 2010], or at the latest, when Mr. Z was confirmed [Ltr. 10 September 2010]. While art. 11(1) Milan Rules allows the Council to rule on objections before the constitution of a tribunal, any decision reached by the Council is not binding on the Tribunal [art. 11(2) 2010 Milan Rules]. Therefore, regardless of the Council’s response, Respondent would have been required to raise the objection again once the Tribunal was constituted. Respondent’s decision to wait until the Tribunal was constituted to raise an objection cannot constitute a waiver of its right to raise that objection. 18. Furthermore, Respondent did not waive its right to challenge the Tribunal’s jurisdiction by raising the objection after submitting its Statement of Defence. Here, Respondent raised an objection to the Tribunal’s jurisdiction in an amendment to its Statement of Defence [Amd. St. of Def. 24 September 2010]. Claimant may argue that a challenge to the jurisdiction of a tribunal is to be raised “no later than the submission of the statement of defence” [art. 16(2) Model Law]. However, Respondent first became aware of the improper constitution of the Tribunal on 20 September 2010 [Proc. Ord. 2], long after it submitted its Statement of Defence on 24 June 2010. Art. 23(2) Model Law permits parties to amend their claims during arbitral proceedings. Accordingly, Respondent did not proceed with the arbitration without stating an objection. B. The time between the improper constitution and Respondent’s objection does not amount to undue delay. 19. Respondent raised its objection without undue delay. Respondent raised its objection on 24 September 2010—just four days after it became aware the Tribunal was constituted with Mr. Z as the presiding arbitrator. Art. 4 Model Law is silent as to what amounts to undue delay [Binder 60]; however, a four-day delay is miniscule in the context of an international arbitration [Zuberbühler et al. 271]. Furthermore, it is reasonable to allow parties time to adequately prepare their objections, including time to draft and submit a statement [Zuberbühler et al. 271]. Accordingly, the conditions for waiver of the right to object under art. 12 Milan Rules and art. 4 Model Law have not been met; Respondent raised a timely objection. C. Respondent’s objection is not disruptive of the arbitral proceedings. 20. An objection to the jurisdiction of the Tribunal at such an early stage in the proceedings is not disruptive to the resolution of the dispute. Since the objection was raised before the arbitration 7
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MEMORANDUM FOR RESPONDENT - Pace University

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