12 November, 2012
Do win, don’t lose:
In-house counsel can find arbitration proceedings complex and difficult to handle, but there are ways external lawyers can help ease the burden.
For in-house counsel, being involved in arbitration proceedings can be a daunting prospect. Leading general counsel on the panel at session four of the ADR in Asia conference shared their advice on how external instructed lawyers can help their clients’ proceedings go more smoothly.
At the top of the list was getting a clear picture at the outset of what is likely to happen over the course of the case.
“What we are looking for with arbitration is the same as what we would get from a good court process, namely predictability,” said Jim Jamison, general counsel for Deloitte China.
In-house counsel do not want surprises, “neither happy nor unhappy”, added Siemens general counsel Gangliang Qiao.
Good case management – ideally a strict timetable set by the arbitrator or panel of arbitrators at the first procedural hearing that the parties adhere to – is another must, and will progress the case swiftly and efficiently, said panellists. This is particularly important due to budget restrictions and the need to manage the expectations of in-house clients: the company directors.
Andy Soh, counsel at General Electric and speaking in a personal capacity, shared what he considered to be a recent arbitration “success story”. Proceedings were filed in June 2011. Less than 14 months later, the arbitration proceedings had concluded: incredibly fast given the complexity of the case and amount of money in dispute. The reason for the efficiency in the case, explained Soh, was the “excellent tribunal [who] took a very firm hand in controlling the proceedings and [committed] themselves and the parties to an aggressive timetable.”
A swift conclusion to proceedings is not the most important factor, however.
“Speed, yes, but not at the expense of due process,” Jamison added later in the discussion.
According to the panellists, in-house counsel should also be advised as to enforceability of any arbitral award at the outset of the case. If it is likely to be unenforceable in their jurisdiction, then litigation should be the method of dispute resolution rather than arbitration.
Qiao dispelled the myth that arbitral awards are unenforceable in China.
“My position is this is not the case… courts do not make a distinction between arbitral awards and court cases,” he said.
In-house counsel also want good, open channels of communication with their instructed law firm to ensure that the business they represent is clear as to arbitral procedure and that their business’ expectations are properly managed.
When asked how he would like private practice lawyers to conduct arbitration proceedings, Soh answered: “Do … perform a rigorous early case assessment, involve us in that process and talk to us about key issues, who the key witnesses are, earlier rather than later, and built into that should be some thought as to settlement possibilities.”
What in-house counsel do not want is for communication to be poor between instructed lawyers and themselves: this could result in a nasty shock for in-house counsel in the course of proceedings.
Finally, and linked to good communication, in-house lawyers want open, frank discussion with instructed private practice lawyers about the cost of the case.
Jun Hee Kim, international general counsel at Hyundai, advised his fellow in-house counsel not to instruct any law firm purely on the basis of rankings or because they charge the lowest fees.
“During the course of arbitration it is not unusual that initial costs have to be adjusted,” he said. “We allocate a budget for the case and beyond that it needs to be re-budgeted, so what is important is quality of work in relation to the finalised budget”.
Kim went on to advise that it is prudent for in-house counsel to ask for a review of fees to help stay within budget.
The bottom line for in-house counsel was succinctly summarised by Kim, who, when asked by panel moderator Lord Peter Goldsmith QC his top five dos and don’ts, said simply: “Do win, don’t lose.”
