MEMORANDUM FOR RESPONDENT - Pace University

More documents

Recommendations

Info

QUEEN’S UNIVERSITY FACULTY OF LAW 1. Claimant divulged the existence of arbitration and the content and subject matter of the dispute. 34. Even if Claimant had merely divulged the existence of this arbitration, that alone would have constituted a breach of art. 8(1) 2010 Milan Rules, which restrict disclosure not only of the “award”, but also of the “proceedings”. This language was adopted to give an expansive scope to the duty of confidentiality [Coppo in Finkelstein 28]. In international arbitrations, “the mere fact that an arbitration is pending may be viewed as a secret” [Noussia 129; Hassneh Insurance v. Mew (UK 1993) 247]. For example, in Aita v. Ojjeh, the Paris Court of Appeal found that Aita challenged the arbitration in a court that it knew lacked jurisdiction for the sole purpose of publicizing the dispute [(France 1986)]. The Court found Aita breached confidentiality by causing “a public debate of facts which should remain confidential” [Paulsson/Rawding 312; Noussia 121]. Here, Mr. Schwitz told Commerical Fishing Today that it had “started arbitration proceedings” against Respondent [Resp. Ex. 1]; this disclosure on its own constituted a breach of art. 8(1). 35. However, Claimant not only disclosed the existence of the arbitration, but also revealed its subject matter and allegations made in the Request for Arbitration [Resp. Ex. 1]. Art. 8(1) stipulates that parties must keep the proceedings confidential, which Claimant violated in its interview with Commercial Fishing Today. The Paris Commercial Court held that a party breached confidentiality when it released a statement divulging the existence of the dispute, the existence of the arbitration, and the amount of the claim [True North v. Bleustein (France 1999) cited in Poudret/Besson 316-317]. Claimant’s disclosure mirrors that in True North: it divulged the existence of the dispute, the existence of the arbitration and facts and arguments pertaining to the merits of the dispute. Mr. Schwitz stated that Respondent had supplied “completely inappropriate” squid to Claimant and “they knew it” [Resp. Ex. 1]. 2. There is no applicable exception to the duty of confidentiality that would have permitted Claimant’s disclosure. 36. Claimant may argue that its breach of confidentiality was permissible. Art. 8(1) 2010 Milan Rules provides that a party may breach confidentiality to the extent required to protect its rights. This provision protects legal rights, such as “the right to enforce or challenge the award”, but does not extend to commercial rights [Coppo in Finkelstein 28-29]. Any disclosure must be “reasonably necessary” to establish the party’s legal rights against a third party [Noussia 31, 110; Insurance v. Lloyd’s Syndicate (UK 1995); Ali Shipping v. Shipyard (UK 1998)]. Art. 8(1) also permits breaches of confidentiality where parties have a legal duty to disclose [Coppo in Finkelstein 29; Noussia 29]. However, Claimant did not owe any legal duty to disclose this arbitration, nor was Claimant enforcing or protecting a legal right [Clar. 15]. 12
QUEEN’S UNIVERSITY FACULTY OF LAW 37. Moreover, confidentiality only applies to material that is objectively secret; the obligation cannot extend to matters that are public knowledge [Dessemontet 314; Noussia 26]. Claimant’s disclosure revealed facts that were not public knowledge. Although Commercial Fishing Today had previously reported on the existence of a dispute, those reports contained no prejudicial comments, nor any mention of the means by which the dispute might be resolved or the content of either Party’s claims [Clar. 17]. By contrast, Claimant not only revealed the existence of the proceedings, but also asserted that Respondent was liable for Claimant’s losses [Resp. Ex. 1]. Claimant was attempting to conduct a “trial by press release” and its conduct cannot be condoned [Born 2282]. The only other exception to confidentiality in art. 8 2010 Milan Rules pertains to the Chamber and not to the parties [art. 8(2)], so Claimant’s disclosure is not saved by any exceptions to its duty of confidentiality. II. IF THE 2004 MILAN RULES APPLY, CLAIMANT IS BOUND BY AN IMPLIED DUTY OF CONFIDENTIALITY. 38. The 2004 Milan Rules do not contain an express duty of confidentiality. However, if the Tribunal finds that the 2004 Milan Rules govern this issue, a duty of confidentiality is implied. The prevailing conception of confidentiality affirms the existence of an implied duty encompassing the proceedings [A], and Claimant violated this duty by divulging the existence and subject matter of the arbitration proceedings [B]. A. Claimant was bound by an implied duty of confidentiality because of the nature of international arbitration proceedings. 39. All parties to international arbitrations are presumed to owe an implied duty of confidentiality [Born 2282; Dolling-Baker v. Merrett (UK 1991); Emmott v. Michael Wilson (UK 2008)]. This implied duty is one of the most important considerations for parties choosing to arbitrate their disputes [Bühring-Uhle et al. 1996; Noussia 125]. The objectives of arbitration—neutral, efficient, and binding dispute resolution—compel the imposition of confidentiality obligations on parties. This duty focuses the parties’ efforts toward dispute resolution, rather than on “trial by press release” and restrains “the aggravation of the parties’ disputes, rather than extending them to additional, more public forums” [Born 2282]. Arbitration preserves privacy and confidentiality “to the greatest extent possible” [Noussia 22]. 40. The privacy of arbitration proceedings would be meaningless without implied confidentiality obligations [Fortier 131]. Privacy requirements exclude third parties from attendance and participation in proceedings and are present in “virtually all national arbitration statutes and institutional rules” [Born 2251]. Confidentiality is an “essential corollary of the privacy of 13
Page 1 and 2: Eighteenth Annual Willem C. Vis Int
Page 3 and 4: QUEEN’S UNIVERSITY FACULTY OF LAW
Page 7 and 8: i.e. Id est [that is] kg Kilogram Q
Page 11 and 12: Hwang, Michael and Katie Chung Inte
Page 13 and 14: Schlechtriem, Peter and Ingeborg Sc
Page 29: QUEEN’S UNIVERSITY FACULTY OF LAW
Page 53: QUEEN’S UNIVERSITY FACULTY OF LAW

MEMORANDUM FOR RESPONDENT - Pace University

Create successful ePaper yourself

Delete template?

Save as template?