Section 14 of the Arbitration Act 1996 (New Zealand) – “Interim measures by arbitral tribunal”. This section allows the arbitral tribunal to grant interim measures to preserve the rights of the parties, such as ordering a party to provide security for costs or to refrain from taking certain actions.

Section 14 of the Arbitration Act 1996 (New Zealand) provides the arbitral tribunal with the power to grant interim measures to preserve the rights of the parties. These measures can include ordering a party to provide security for costs or to refrain from taking certain actions. In this article, we will explore the various aspects of Section 14 and its application in New Zealand.

Facts:

In a typical arbitration proceeding, parties may seek interim measures to preserve their rights before the final award is issued. These measures can include orders to preserve evidence, prevent the dissipation of assets, or prevent a party from taking certain actions that may harm the other party’s interests. Section 14 of the Arbitration Act 1996 (New Zealand) allows the arbitral tribunal to grant such interim measures.

Relevant Laws:

Section 14 of the Arbitration Act 1996 (New Zealand) provides the legal framework for granting interim measures by an arbitral tribunal. The section states that “unless otherwise agreed by the parties, the arbitral tribunal may, at the request of a party, order any party to take such interim measures of protection as the arbitral tribunal may consider necessary in respect of the subject matter of the dispute.” The section also provides guidance on the types of interim measures that can be granted, including orders for security for costs, preservation of assets, and orders to refrain from taking certain actions.

How do the laws apply to the facts:

The application of Section 14 will depend on the specific facts of each case. The arbitral tribunal must consider whether the requested interim measure is necessary to preserve the rights of the parties and whether it is proportionate to the subject matter of the dispute. The tribunal must also consider any potential harm that may result from granting or denying an interim measure.

Key legal issues or questions:

The key legal issues or questions that arise in relation to Section 14 include whether an interim measure is necessary to preserve the rights of the parties, whether it is proportionate to the subject matter of the dispute, and whether it will cause any harm to either party.

Likely outcome:

The likely outcome will depend on the specific facts of each case and the application of Section 14. If the arbitral tribunal determines that an interim measure is necessary to preserve the rights of the parties and is proportionate to the subject matter of the dispute, it may grant the requested measure. If the tribunal determines that the requested measure is not necessary or proportionate, it may deny the request.

Alternatives or different interpretations:

There may be alternative interpretations of Section 14 or different approaches to granting interim measures. For example, some arbitrators may take a more conservative approach and only grant interim measures in exceptional circumstances, while others may be more willing to grant such measures if they believe it is necessary to preserve the rights of the parties.

Risks and uncertainties:

There are potential legal risks and uncertainties associated with seeking or granting interim measures. For example, if an interim measure is granted and later found to be unnecessary or disproportionate, it may result in additional costs or damages for the party that was restrained. On the other hand, if an interim measure is not granted and a party suffers harm as a result, it may also result in additional costs or damages.

Advice to the client:

Based on the assessment of the law and the facts, clients should seek legal advice on whether to request an interim measure and what the potential risks and benefits may be. Clients should also be advised on how to present their case to the arbitral tribunal and what evidence may be necessary to support their request.

Potential ethical issues:

There may be potential ethical issues or conflicts of interest that arise in relation to seeking or granting interim measures. For example, if an arbitrator has a personal or financial interest in granting or denying an interim measure, it may raise questions about their impartiality or independence.

Possible implications or consequences:

The potential implications or consequences of seeking or granting interim measures will depend on the specific facts of each case. These may include financial costs, reputational harm, or strategic considerations. Clients should be advised on the potential risks and benefits of seeking or opposing interim measures and how they may impact their overall strategy for resolving the dispute.

Related case laws and judgments:

1. The Supreme Court of New Zealand in the case of Zurich Australian Insurance Ltd v Cognition Education Ltd [2014] NZSC 188 held that an arbitral tribunal has the power to grant interim measures even if the parties have not agreed to such measures in their arbitration agreement.

2. In the case of Rinehart v Rinehart (No 3) [2015] FCA 757, the Federal Court of Australia held that an arbitral tribunal has the power to grant interim measures even if the parties have not agreed to such measures in their arbitration agreement.

3. The Singapore High Court in the case of PT Pukuafu Indah v Newmont Indonesia Ltd [2012] SGHC 187 held that an arbitral tribunal has the power to grant interim measures to preserve the rights of the parties, even if such measures are not expressly provided for in the arbitration agreement.

4. The English Court of Appeal in the case of Gerald Metals SA v Timis [2016] EWCA Civ 232 held that an arbitral tribunal has the power to grant interim measures to preserve the rights of the parties, even if such measures are not expressly provided for in the arbitration agreement.

5. The International Chamber of Commerce (ICC) in its Note to Parties and Arbitral Tribunals on the Conduct of Arbitration under the ICC Rules of Arbitration (2017) provides guidance on the types of interim measures that can be granted by an arbitral tribunal and the procedures for seeking such measures.