Securing the appointment of an arbitral tribunal in the absence of agreement: the default appointment procedures under the Arbitration Act 1996 – little understood and seldom properly followed
By John Green
Where cl 1 of sch 2 to the Arbitration Act 1996 applies, that clause modifies art 11 of sch 1 and excludes the jurisdiction of AMINZ as the appointed body under s 6A(1) of the Act to appoint an arbitrator. AMINZ may only intervene and appoint an arbitrator in its role as the appointed body where cl 1 of sch 2 does not apply.
Securing the appointment of an arbitral tribunal is really such a simple process, yet the provisions in the Arbitration Act 1996 (the Act) which govern the process and procedures to be followed are the least understood and are seldom correctly followed by parties and/or their advisors looking to enforce a contractual right to refer disputes to arbitration. Twelve months ago, we published an article in ReSolution authored by NZDRC and NZIAC Executive Director, Catherine Green, titled ‘Agreeing to disagree: default appointment of arbitrators in domestic arbitrations’. The article arose as a result of the large number of enquiries we were receiving (and still receive – hence this article) from parties to disputes (or their legal advisors) who are having difficulty navigating the process for securing the appointment of an arbitral tribunal in circumstances where an arbitration agreement in a contract or transaction does not specify either: • that the arbitration was to be conducted under the NZDRC/NZIAC/BDT Arbitration Rules; or, • an appointing person/body, in the event of disagreement as to the composition of the arbitral tribunal or failure or refusal by any party to the arbitration agreement to participate in the appointment process. The article highlighted the lack of understanding by many parties and their legal advisors as to the correct process to be followed in relation to securing the appointment of arbitral tribunals in domestic arbitrations in which the parties have neither agreed on the constitution of the tribunal nor agreed on a nominating body (either by reference to institutional rules or specifically) and explained the process to be followed to secure the appointment of an arbitral tribunal in those circumstances. Unfortunately things have not got any better, and with the appointment of AMINZ in March 2017 as the body appointed under section 6A(1) of the Act (the appointed body) to resolve appointment issues under article 11, schedule 1 of the Act, matters have only become more muddled and confused.