In its ruling issued on 9 November 2022, the First Civil Chamber of the French Court of Cassation confirmed the Paris Court of Appeal’s decision of 26 January 2021 which dismissed a request to set aside an ICC arbitral award rendered in a multi-party arbitration by a tribunal comprised of 5 arbitrators all designated by the ICC Court. In this ruling the Court addressed two issues: the constitution of the tribunal in a multi-party arbitration and the arbitrator’s duty to disclose circumstances affecting his independence or impartiality after accepting his mission.
On the first issue, the Court ruled, relying on the parties’ equal right to participate in the designation of the arbitrators, that unless the parties to a multi-party arbitration agree otherwise (after the dispute has arisen), the arbitral institution shall appoint all the members of the tribunal, notwithstanding the appointment mechanism stipulated in the arbitration agreement. The appointment mechanism agreed before the dispute arose should thus be disregarded if, after the dispute has arisen, the parties disagree as to whether this mechanism should be followed, one of the parties alleging that it violates the principle of parties’ equality.
On the second issue, the Court approved the Paris Court of Appeal’s decision specifying that arbitrators have a duty, both before and after accepting their mission, to disclose circumstances that give rise to a reasonable doubt as to the arbitrator’s independence and impartiality. According to the Court of Appeal’s reasoning, which the Court did not disapprove, such circumstances may derive from a potential conflict of interest between the arbitrator and one of the parties, in which case the conflict of interest is direct, or between the arbitrator and a third party interested in the arbitration, in which case it would be indirect. In the case of a potential indirect conflict of interest, the assessment of whether such conflict gives rise to a reasonable doubt as to the arbitrator’s independence and impartiality, depends on the intensity of the link between the arbitrator and the third party interested in the arbitration.
Iurgium [previously Spain Arbitration Review]