An Scoil Dli, UCDUCD School of Law

Decision Making in the Context of the Administrative Sanctions Procedure

A programme for Inquiry Members of the Financial Service Regulatory Authority

19 and 26 May, 2007

G Brian Hutchinson, BCL LLM DAL FCIArb BL

Vice Dean, School of Law

Applied Fair Procedures

• Heavy Analogies throughout with Arbitral Procedures– But note:

• Arbitration final and binding (no appeal)• Arbitration arises through agreement – not by statute;

The Conduct of the Process

• Introductory– Nothing in Arbitration Acts about Procedure

• Flexibility• Confusion and Expense

– Agreed Procedure• London Export v. Jubliee Coffee [1958] All ER 494• EDM Mertens v. Veevoder Import [1979] 2 Lloyds’ Rep

327 - current rules• Agreed Procedures through Conduct• Arbitrator’s Powers under s19 1954 to Direct

Procedure – similar powers given to Presiding Member of Inquiry.

Stages in a Reference

• Commencement

• Appointment of Arbitrator

• Interlocutory stage

• Hearing

• Post Hearing/ Pre Award

• Award

• Post Award

Interlocutory Stage

• Arbitrator must establish rules of procedure– Pratt v Swanmore

• Advisable: Preliminary meeting to:– identify matters in dispute– establish rules

Communication with the Parties

• Fair Procedures– justice must be done and be seen to be done

• Practical Advice– never communicate with one side alone– copy all correspondence to the other side

The Preliminary Meeting

• Parties

• Agreement

• Issues

• Fees

• Representation

• Reasons

• Programme for Pleadings

• Further and Better Particulars

• Scott Schedule

• Discovery

• Security for Costs

• Conduct of Reference

• Communications with the Arbitrator

• Hearing

• Witnesses

• Transcripts

• Oath

• Opening and Final Addresses

• AOB

Representation

• Choice personal to parties

• Arbitrator may warn as to costs

• Fairness?

• Representation by non-lawyers

Pleadings

• Pattern– points of claim– points of defence and counterclaim– points of reply to defence and defence to counterclaim– points of reply to defence to counterclaim

• Presumptions– if not pleaded can’t be proved (notice)– If not denied taken to be admitted

• Further and Better Particulars– may lead to application for amendment of pleadings– potential for delay

• Notice to admit facts

Discovery and Inspection

• General Duty: to Discover documentation etc which may be relevant

• Subject to Privilege– Lawyer / Client - privileged– Lawyer / Third Party - if litigation/arbitration

contemplated– If admitted privilege is lost

• Arbitrator may have to decide on Privilege

• Agreed Bundles– Documents are what they purport to be– Identical bundles prepared

Order(s) for Directions

• Set out the procedure– timetable for exchange of pleadings– arrangements for discovery– Time and venue of hearing

• Endorsements– liberty to apply– costs of meeting, order, and applications to be costs in

the arbitration

Interim Awards

• Settlements or agreed matters may be dealt with by way of interim award

• Full settlement may be entered - for enforceability

An Scoil Dli, UCDUCD School of Law

The Hearing

The Hearing - General

• Notification; Venue (Claimant)– Natural justice: Sufficient notice to both

sides required

• Adjournments– Natural justice: Is it necessary to allow fair

opportunity to present case

• Proceeding ex parte:– Grangeford Structures v SH Ltd,

• notify of intention to proceed

• allow reasonable time for response

The Hearing Continued…

• Privacy

• Representation– according to wishes; but note costs

• Standard of Proof? Balance of Probabilities

• Witnesses & Experts– can be excluded during others’ testimony– Experts owe different duties

• Record– notes and tape for personal use– transcript by agreement

The Hearing Continued ….

• Oath & Affirmation

• Challenges to Jurisdiction

– Can arbitrator consider?

• Rules of Evidence– Must arbitrator adhere?

• Own knowledge– Can Arbitrator Rely?

Challenges to the Arbitrator’s Jurisdiction

• Is there any agreement ?

• Is there a dispute?

• Is it within the scope?

• Is is arbitrable?

• Adjourn for case stated?

Rules of Evidence in Arbitrations

• General Advice: Apply Strict Rules

• If agreed, otherwise inadmissible evidence admissible– Henry Bath & Co v. Birgby [1962] 1 Lloyd’s Rep

389– GKN Gears v. Matbro [1976] 2 Lloyd’s Rep 555

• unless it goes to he heart of the dispute

• Walford Baker v McFie & Sons [1915] 113 LT 180

• Natural Justice must be respected– Keighley Maxted & Co v. Durant [1893] 1 QB 405

Admissibility of Evidence

• If Relevant, then admissible– But:

• Hearsay• Opinion• Privilege• Illegally or unconstitutionally obtained• “Without Prejudice Communications”

– Query: Defamation possible in Arbitration Proceedings?

• Defamation Act, 1961 - “exercising functions equivalent to those of an established court of justice”

Witnesses

• Are called by parties, not tribunal

• Witnesses of Fact– called by the parties– may not refer to notes unless admitted in

evidence

• Witnesses of Opinion (Expert Witnesses)– Duty is to Arbitral Tribunal (not side)– May refer to notes, Reports etc– Exchange of reports in advance

Examination of Witnesses

• Oath or Affirmation

• Examination in Chief

• Cross Examination

• Re-examination

The Standard and Burden of Proof

• Standard: Balance of Probabilities– “more probable than not”– if probabilities equal, not proved

• Burden: On party asserting

Expert Arbitrators

• May rely on own expertise– Eades v Williams 24 LJ Ch 531

• But must allow parties an opportunity to controvert– Fox v Wellfair [1981] 2 Lloyd’s Rep 514.

Closing the Hearing

• Necessary formally to state