A conversation between Ashlea Read, Director and Quantum Expert, and Khalid Yousri, Regional Operations Director, Dubai, UAE.
Ashlea Read will answer the questions relating to an Expert in Arbitration, whilst Khalid Yousri will answer the questions relating to an Expert in Expert Determination.
What are the differences between the two roles?
Q-1: How does the process start?
Expert in Arbitration:
The parties will have generally agreed a dispute process within a clause of the contractual agreement. In the example of arbitration, the process usually starts with one party giving notice to the other of its intention to arbitrate a dispute. The clause will generally set out the seat of the arbitration which will determine the procedural rules. There are usually two ways for an expert in arbitration to be appointed, either by party appointment or via an arbitral institute.
Generally, under common law jurisdictions, party appointed experts are more common, whereas under civil law jurisdictions it is more common to have an expert appointed by the tribunal or an arbitral institute.
Expert in Expert Determination:
It is generally dictated by the terms set out in the contractual agreement which may incorporate an expert’s term of reference, or from a separate ad-hoc agreement that the parties enter into later, which can be tailored to suit their needs.
However, unlike other forms of alternative dispute resolution, for example arbitration, there are no statutory rules governing the expert determination procedure.
In the Middle East, the trend of inclusion of expert determination prior to progressing to a formal dispute resolution is becoming more popular in construction contracts.
Q-2: How long does the process take from commencement to decision?
Expert in Arbitration:
The duration of an arbitration will be dependent upon various factors and as such the length of arbitration can vary greatly. There is no one answer as to how long an arbitration may take. The various factors may include the availability of the arbitrator(s) and the legal counsel, the number and complexity of the issues, and the number of witnesses required, both expert and factual.
Expert in Expert Determination:
The expert determination process is usually quicker than arbitration or litigation. The period will be dependent upon the number of issues and the complexity of the issues that the expert is required to determine. For a sizable dispute, it is normal for this to take between two to four months.
Q-3: What is the Expert Role and duty?
Expert in Arbitration:
To provide a professional opinion on the matter in dispute based on their field of experience and knowledge. The purpose of the expert is to provide an independent and unbiased opinion to assist the tribunal in reaching its decisions regardless of who pays its fees. Experts enable the tribunal to understand issues that are outside of its area of knowledge. The expert should not advocate a party’s case.
Expert in Expert Determination:
The role of the expert is to act impartially and to allow each party the opportunity to be heard by the other party. The expert determiner would reach a decision by considering the presented evidence and applying their expertise. It is important to establish that the appointed expert is not an expert witness or an arbitrator.
Q-4: What does the process usually involve?
Expert in Arbitration:
This usually involves producing several independent reports as per the instructions provided by the appointed counsel and pursuant to the tribunal’s requirements. This may also involve a joint report with the opposing expert to try to narrow down the number of issues in dispute, again to assist the tribunal.
The expert may then be required to provide oral testimony in a hearing, which is a chance for the parties to present their evidence to the tribunal and to test that of the other party.
Expert in Expert Determination:
The process is usually agreed between the parties. However, generally, the process includes submissions by the parties, the number of which are usually stipulated within the agreement.
The expert determiner then proceeds with reviewing the documents and may issue requests for information or have meetings with the parties in case of further clarifications.
Thereafter, normally the expert determiner would proceed with its final determination; however, and depending upon the nature of the agreement, the determiner may issue an interim determination to allow the parties to comment prior to proceeding with its final determination.
Q-5: How does the Expert deal with the issues outside its area of Experience, and/or, Expertise?
Expert in Arbitration:
The simple answer is, it should not… Generally, the expert’s CV will be appended to its reports, allowing the tribunal to understand the expert’s evidence and level of expertise on the subject matter.
If an expert has provided evidence outside of its area of expertise, not only will the expert be made to feel particularly uncomfortable in cross examination but, and more importantly, the tribunal may choose to disregard part or all of the expert’s testimony.
Expert in Expert Determination:
Subject to the terms of the ad-hoc agreement, the expert determiner may delegate issues outside of its area of expertise to other experts. Any involvement of other experts should be communicated to the parties and the proposed experts should be approved.
Q-6: How does the decision get enforced?
Expert in Arbitration:
An arbitration award is determined by a tribunal based on the merits presented by each party. Following the issuance of the award, enforcement can only come through the court system. However, it is important to note that the rules governing the arbitration and the applicable law may affect the recognition and enforcement of an award.
Expert in Expert Determination:
Enforcement usually depends upon what is agreed between the parties in the terms of reference. Generally, most expert determinations I have been involved in have been non-binding. In instances where it is agreed by the parties that the award is binding then it can usually be enforced through court proceedings.
Q-7: How does the decision get challenged?
Expert in Arbitration:
There are several ways to challenge an arbitration award and most countries in the world allow arbitration awards to be challenged, although circumstances are usually limited. The two most common grounds for challenge are that the tribunal did not have jurisdiction to make the award or irregularity on the part of the tribunal.
Expert in Expert Determination:
The ability to challenge depends mainly on the nature of the determination as per the agreement. If the determination is non final, and non-binding, then there is nothing to challenge, assuming that such a determination is not admissible later in formal dispute proceedings. However, if the decision is final and binding, there is usually a timeline for how and when the decision can be challenged. This usually starts by issuing a notice of dissatisfaction and then proceeds to the dispute resolution process contained within the contract agreement.
Q-8: What are the main pros of the process?
Expert in Arbitration:
- Party appointed experts are usually selected for their area of expertise to assist the tribunal.
- A strong report together with solid oral evidence can make a significant impact on a party’s position (may improve it).
- Tribunal appointed experts may appear to possess a greater capacity to remain impartial in their opinions.
- The expert can provide a simple understandable approach and explain complex information and data to assist the tribunal.
Expert in Expert Determination:
- It is quicker than other forms of dispute resolution.
- An expert determination can be used whilst a project is still ongoing (in a shorter period than arbitration) which allows the parties to focus on completion of the project.
- It can provide an indication as to the likely outcome for the parties prior to a formal dispute.
- It may facilitate an early commercial settlement.
- It is usually more cost effective than a formal dispute process.
- It can be a flexible process, tailored to suit the nature of the dispute(s).
Q-9: What are the main cons of the process?
Expert in Arbitration:
- Party appointed experts may sometimes be considered as advocates for the party who appointed them.
- Lack of coordination between the party appointed experts.
- Differing instructions provided to each expert within the same discipline.
- Tribunal appointed experts are not always trusted by the parties.
- An early appointed tribunal expert may not have appropriate expertise given that the tribunal may not be aware of all the issues in detail.
Expert in Expert Determination:
- The parties may opt for a non-binding determination which could be seen as a waste of time and money.
- Lack of substantive submission by either party can cause the expert determination to identify weaknesses in the party’s position, which may assist the opposing party if the dispute is referred to alternative dispute resolution later.
- The expert determination may lack the analysis of the legal aspects of the dispute leading to incomplete decisions.
- The process is generally not reinforced by statute.
- Not suitable if there is significant disagreement over the interpretation of legal matters assuming the expert determiner has no legal background.
Q-10: Any final words?
Expert in Arbitration:
It is important to involve an expert from an early stage to help develop the most effective independent opinion and to allow sufficient time for the expert to undertake appropriate research, as well as ensure that information and data is collated by the parties early for adequate analysis.
Expert in Expert Determination:
Often, expert determination is used to narrow the disputes between the parties and is an effective process for the parties to understand their position as set out by an independent third-party. This allows the parties to make a more considered decision before proceeding to formal dispute. Given that the process is confidential, it also safeguards commercially sensitive data and can assist in maintaining good commercial relationships.
This article was written for issue 27 of the Diales Digest. To view the publication, please visit: www.diales.com/diales-digest-issue-27