Eulogy by arbitrator raises doubts over independence and impartiality

Background

In December 2020, the unsuccessful respondent in a Paris-seated ICC arbitration, applied to the Paris Court of Appeal to set aside a partial arbitral award. The respondent’s application relied, amongst other things, on the written tribute of the tribunal President (Thomas Clay) to the late Professor Emmanuel Gaillard. Professor Gaillard was the prevailing party’s Counsel in the arbitration and he passed away after the partial award was issued.

On 10 January 2023, the Court granted the application. It set aside the award under Article 1520.2 of the French Code of Civil Procedure, for the reasons that are explored below.

Separately, the respondent applied to the ICC for the replacement of the tribunal’s President. The respondent’s challenge before the ICC was, however, unsuccessful, with the consequence that the arbitral proceedings continued with the same tribunal, which subsequently issued a final award (which is currently the subject of separate annulment proceedings).

Eulogy gives rise to doubts as to the President’s independence and impartiality

The President did not comply with his disclosure obligation

The Court first examined the president’s disclosure obligation. The Court noted that the President had no obligation to disclose his academic ties with the parties involved (generally speaking). However, it considered that the President’s close friendship with Professor Gaillard – as was apparent from the President’s eulogy – should have been disclosed. 

The Court observed that, while eulogies typically include overstated comments and should not necessarily be taken at face value, in this case, things were different. Certain statements (e.g. “I consulted him before making any important decision” and “Emmanuel, who rarely did so, was finally opening up [to me]”) reflected a strong personal relationship between the President and Professor Gaillard. 

The existence of reasonable doubts as to the President’s independence and impartiality

The Court then moved on to the question of whether the President’s undisclosed ties were such that, in the parties’ minds, they would give rise to reasonable doubts as to the President’s independence and impartiality (in which case the award would have to be set aside). In the Court’s view, the answer was ‘yes’. 

The Court noted that the President’s tribute linked his personal ties with Professor Gaillard to the then pending arbitration. The President had insisted (in the eulogy) that he was looking forward to “hearing again [Professor Gaillard’s] impressive knife-edge pleadings where his precision and overreaching vision seduced me much more than any histrionic outbursts”, and that he “consulted [Professor Gaillard] before making any important decision”. The Court held that this was sufficient to raise reasonable doubts in the parties’ minds as to the President’s independence and impartiality.

Commentary

The decision is consistent with established French law. Under Article 1520.2 of the French Code of Civil Procedure, an arbitral award may be set aside where an arbitral tribunal’s constitution is irregular. The French courts have regularly held that: (i) an arbitrator’s failure to disclose circumstances that are likely to raise, in the parties’ minds, reasonable doubts as to the arbitrator’s independence and impartiality is sufficient ground for the annulment of an arbitral award; and (ii) an arbitrator’s personal relationship with one of the parties’ Counsel qualifies as such circumstance. 

The Court’s reasoning makes clear that it was not the eulogy itself that caused the Court to set aside the award. Rather, it was the tribute’s reference to the then pending arbitration and some of the President’s statements that revealed “closeness and intimacy” with Professor Gaillard. The take away, therefore, is for arbitrators to take a generous approach to the disclosure of strong personal relationships with Counsel and not to save such disclosures for public tributes.

Judgment: CA Paris 10 January 2023, No 20/18330