Arbitration at the SIAC – Joinder of Parties & Consolidation

 

“What is important is not to fight, but to fight the right enemy”
– Bangambiki Habyarimana, The Great Pearl of Wisdom

 

 

Rule 7 – Joinder of Parties

There may be situations where you are required, whether as a Claimant or a Respondent, to bring a third party into the arbitration. Rule & of the Rules allows you to do so, provided:

a. The third party is on the face of it, bound by the arbitration agreement in question; or
b. The Claimant, Respondent and third party agree to the third party being called into the arbitration as an additional party.

 

The application to bring in the additional party must include:

a. The arbitration’s reference number;
b. Particulars of all parties to the arbitration and those of their representatives including the additional party. This will include names, addresses, facsimile numbers, telephone numbers, email addresses etc;
c. Information as to whether the third party is being asked to join as a Claimant or Respondent;
d. A reference to and copy of the arbitration agreement. A reference to and where possible, copy of the contract/ agreement/ treaty out of which the dispute arises;
e. If there is consent of all parties to the joinder, then the document setting out the agreement to be identified and if possible, a copy of the same to be produced; and
f. A concise brief of the facts and legal basis in support of the application for joinder.

 

Upon submission of the above information and/or documents, it is deemed that the application for joinder is completed. Alternatively, the application is deemed complete when it is determined by the Registrar that the submitting party has substantially complied with the requirements for submission. Once the application for joinder is complete, SIAC shall notify all parties. This includes the additional party.

As with the Statement of Claim, Defence and Counterclaim, service of the application on all other parties, including the additional party, is a requirement. The applying party must inform the Registrar of the manner and date of service.

The application for joinder under Rule 7 is assessed by the Court, taking into consideration all the circumstances of the case. It should be noted that the Tribunal, once constituted, has the discretion to review the decision in under certain circumstances.

The date of the arbitration commencing is deemed to be the date where the application for joinder is granted.

Even after the Tribunal’s constitution, a party of non-party can make a joinder application if either of the following conditions are fulfilled:

a. The additional party is on the face of it, bound by the arbitration agreement in question; or
b. The Claimant, Respondent and additional party agree to the additional party being called into the arbitration as an additional party.

 

Rule 8 – Consolidation

Matters concerning consolidation largely reflect matters as set out in Rule 5, Multiple Contracts.

A party may file a consolidation application with the Registrar before the Tribunal is constituted if any of the following conditions are met:

a. All parties agree to the application to consolidate; or
b. All claims in the respective arbitrations are made pursuant to the same arbitration agreement; or
c. Even if there are separate arbitration agreements, they are compatible, and

i. “the disputes originate from the same legal relationship;

ii. The disputes originate from agreements which are comprised of a principal agreement and its ancillary agreement(s); or

iii. The disputes originate from the same transaction or the same series of transactions.

 

As with the application for joinder, the application for consolidation must include:

a. The arbitrations’ reference number;
b. Particulars of all parties to the arbitration and those of their representatives. This will include names, addresses, facsimile numbers, telephone numbers, email addresses etc;
c. A reference to and copy of the arbitration agreement. A reference to and where possible, copy of the contract/ agreement/ treaty out of which the dispute arises;
d. If there is consent of all parties to the consolidation, then the document setting out the agreement to be identified and if possible, a copy of the same to be produced; and
e. A concise brief of the facts and legal basis in support of the application for consolidation.

 

The applying party is required to serve the application on the Registrar and the other parties. The applying party must inform the Registrar of the manner and date of service.

As with the application for joinder, the application for consolidation is assessed by the Court, taking into consideration all the circumstances of the case. It should be noted that the Tribunal, once constituted, has the discretion to review the decision in under certain circumstances.

The applications for joinder and consolidation seem to be, on the face of it, fairly straightforward. In practice, they seldom are unless there is agreement among parties. The reality is that it is not often that parties to an arbitration are so agreeable to each other’s applications.

 

* From the SIAC Rules, 6th Edition

 

Please note that this article does not constitute express or implied legal advice, whether in whole or in part. If you have any queries or require legal advice, please contact us at walter@silvesterlegal.com.