Arbitral Interim Measures: Fact or Fiction? - Dispute Resolution Journal - Vol. 57, No. 4
The author is an international arbitration partner in the London office of the law firm Masons.
Originally from Dispute Resolution Journal
Can a party to an international arbitration obtain virtually any interim remedy that may be necessary from the arbitral tribunal or a court? If the arbitration is conducted under the AAA’s International Arbitration Rules, the answer would appear to be yes. However, in practice, obtaining interim relief in an international arbitration can be complicated and may depend on a number of factors. This article describes the types of problems that can be encountered and offers a possible solution.
The practical importance of interim measures of protection is well understood by litigation and arbitration practitioners alike. From, and in some cases even before, the outset of court or arbitration proceedings, problems may arise that can have a major, at times determinative, effect on the final outcome. A classic example is when existing evidence that would influence the result may be destroyed or “lost.” Another example is when there is a risk that identifiable assets that could satisfy a claim may be placed out of reach and therefore will not be available if the claim were to succeed.
In all civilized countries, courts have developed detailed procedures under which parties to their proceedings may apply for, and in appropriate circumstances, obtain a variety of interim measures. For example, in England, a party to an action in the courts may obtain interim measures, including orders to freeze assets, require interim payments, search and seize property in the hands of a party, preserve documents and other forms of evidence, restrain or compel particular acts or conduct by a party, or provide security for costs. Such orders may be enforced against persons within the territorial jurisdiction of the court, by proceedings for attachment or contempt.1
At first sight, the ability of parties to a commercial arbitration to obtain interim measures from the arbitral tribunal might not appear to pose any particular problem. For example, parties who agree to arbitrate under the International Arbitration Rules of the American Arbitration Association (AAA international rules) have the benefit of Article 21, which authorizes the tribunal, at a party’s request, to “take whatever interim measures it deems necessary, including injunctive relief and measures for the protection or conservation of property.” Article 21 also states that a request for interim measures from a court “shall not be deemed incompatible with the agreement to arbitrate or a waiver of the right to arbitrate.” On the face of it, this would seem to provide the best of both worlds: an option to obtain virtually any interim remedy from either an arbitral tribunal or a court. But does it?
International arbitration practitioners are all too aware that the availability of arbitral interim measures is not nearly so simple. The conundrum is this: In certain circumstances, an arbitral tribunal’s ability to grant interim measures may be limited. If that is the case, a party to an international arbitration will have to seek interim measures in a national court that it may have wished to avoid when it agreed to arbitration. Further, if that happens, the court may decline to grant the measure requested, either because it concludes that seeking judicial interim relief is incompatible with the arbitration agreement or that it is undesirable for the court to interfere in the arbitration process.2
The problem is not merely academic. In a recent survey of international arbitrators by the Global Center for Dispute Resolution Research, 64 respondents identified 50 separate arbitration cases in which interim relief was sought either to restrain or stay an activity, order specific performance, or provide security for costs.3 These figures are consistent with earlier reports to the United Nations Commission on International Trade Law (UNCITRAL), which indicated that parties are seeking interim measures in an increasing number of cases.4 The availability of arbitral interim measures is not a subject that can safely be ignored.