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25 January 2018
The Supreme Court recently ruled that the provisions that require arbitrators' details to be included in the award also apply by analogy to tribunal secretaries.
In an unusual case, the losing party in a domestic arbitration sought to set aside an arbitral award as it failed to refer to the appointment of a secretary in its decision, despite the fact that it referred to the payment of a secretary's fees (using the term 'secretary assistant') in the operative part of the award without further details on the identity of the secretary. The Athens Court of Appeal set aside the award.(1) The matter was subsequently brought before the Supreme Court.
The Supreme Court held(2) that although the law does not require an award to mention the secretary's details, the provision that requires the award to contain the arbitrators' details(3) applies by analogy to a secretary, regardless of whether the latter is appointed by the tribunal or following a party proposal. The court explained that, in the absence of specific provisions in the arbitration agreement regulating this matter, the appointment of a secretary must be notified to the parties in order for them to be able to challenge the appointment.(4) The court further clarified that the grounds for challenging arbitrators apply by analogy to the challenge of a tribunal secretary. It is for this reason that the secretary's details must be mentioned in the award. Any failure to include such information in the award constitutes grounds for its setting aside.(5)
The use of secretaries in domestic, international, commercial or investment arbitration is common practice. The functions assumed by secretaries are mainly organisational;(6) hence, they are referred to as 'administrative secretaries'. Even in cases where they act as assistants to the tribunal, assist in case law research or draft procedural orders or non-substantive parts of the award (eg, those referring to the identity of the parties or the procedural history of the arbitration), their role is still not elevated to that of a quasi-arbitrator.(7) Although the award in the case at hand referred to the secretary as 'secretary assistant', there was no indication as to the functions exercised by the secretary. The Supreme Court's judgment referred generally to secretaries without any further distinction between a secretary and a secretary assistant.
The Supreme Court's solution is somewhat controversial. In essence, the court created a new ground to set aside an award when it applied by analogy one of the provisions that require arbitrators' details to be included in the award to the challenge of a secretary. Although the view that tribunal secretaries "are expected to be and remain impartial and independent during the arbitral proceedings" is in the ascendancy,(8) whether this should also lead to the creation of a ground for setting aside awards is a matter of legislative policy and not the result of expansive interpretation.
What remains a real issue with respect to tribunal secretaries is those cases in which a secretary assumes a more active role and is involved in the decision-making process (eg, in the drafting of substantive parts of the awards), in essence substituting the functions of an arbitrator, despite the fact that the latter is under an inherent duty not to delegate his or her mandate.(9) In such a case,(10) in light of the generally applicable principle of party autonomy, it is essential for the parties to either agree on the particular function of the secretary or accept a relevant proposal by the tribunal. Otherwise, the award may be set aside or refused recognition and enforcement because of irregularities in the composition of the tribunal.(11)
With this in mind, following the Supreme Court's judgment, in domestic arbitrations in Greece, arbitrators should always refer in detail to the particulars of the secretary employed in the arbitration (which is always a best practice) in order to avoid unnecessary complications that may lead to the setting aside of the award.
For further information on this topic please contact Antonios Tsavdaridis at Rokas Law Firm by telephone (+30 210 361 6816) or email (email@example.com). The Rokas Law Firm website can be accessed at www.rokas.com.
(3) Article 892(2) of the Code of Civil Procedure provides that "An arbitral award must contain (a) the names and surnames of the chairman and arbitrators". An equivalent provision does not exist in international arbitration; see Article 31 of Law 2735/1999 repeating the provision of Article 31 of the United Nations Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration.
(4) The court also held that the provisions for challenging arbitrators, which are the same as those for challenging judges (ie, Article 52(1) of the Code of Civil Procedure), apply by analogy to tribunal secretaries.
(7) See Paragraph 36 of the 2016 UNCITRAL Notes on Organising Arbitral Proceedings. In the previous edition of the notes (1996), such a function was considered somewhat controversial; see Paragraph 27 (1996).
(10) A prime example is the recent Yukos arbitration (a dispute between former Yukos shareholders and the Russian Federation), in which it was alleged that the secretary assumed the function of an arbitrator, but the award was set aside on other grounds; see the analysis of GA Bermann, The Yukos Annulment: Answered and Unanswered Questions in The American Review of International Arbitration 27 (2016): 1-20 (15-20) (the author provided an expert opinion for the Russian Federation). Another example is the arbitration in Sonatrach v Statoil, in which an allegation that the secretary participated in the deliberations was held by the English High Court to be very serious but without merit; see  EWHC 875 Comm (per Justice Flaux, at Paragraphs 46-50).
(11) With respect to setting aside, see Article 897.4 of the Code of Civil Procedure (for domestic arbitration) and Article 34(2)(a)(dd) of Law 2735/1999 (for international arbitration) repeating the provision of Article 34(2)(a)(iv) of the UNCITRAL Model Law on International Commercial Arbitration. With respect to recognition and enforcement, see Article V(1)(d) of the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.
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