This is what Lindskog argues, see Skiljeförfarande — En kommentar (Zeteo) II-14 §- 5.2. The procedure set out in the SAA is non-mandatory and subject to party autonomy, cf. § 12 of the SAA and below. Numerous alterations of these rules are also seen in practice. For example, it is not uncommon for the parties in international ad-hoc arbitration to agree on the procedure for the appointment of the chairperson. A common alteration is that the parties jointly, by agreement, appoint the chairperson as well, or that the parties agree on a short-list of chairperson candidates from which the party–appointed arbitrators have to choose. No such alternative solutions are considered in this article. 4 See the Government’s proposal (Sw. Lagrådsremiss) En modernisering av lagen om skiljeförfarande dated March 1, 2018, as well as the Swedish Government Official Report SOU 2015:37 Översyn av lagen om skiljeförfarande. The Council on Legislation left its opinion on the proposed changes on April 17, 2018, but made no comments in relation to the matters discussed in this article, see also section 2.2 below. 5 A suggestion to this effect was put forward in the Government Official Report SOU 2015:37 Översyn av lagen om skiljeförfarande, p. 178, but was discarded by the Government in its proposal En modernisering av lagen om skiljeförfarande, p. 31. 6 The SAA does not specifically provide for independence, but this is generally considered to be implied by impartiality. See Hobér, International Commercial Arbitration in Sweden 4.62. See also § 21, which states that “the arbitrators shall handle the dispute in an impartial […] manner.” The Council on Legislation’s only comment on the Government’s proposal was that independence should, for the sake of clarity, explicitly be mentioned in § 8 since this is the internationally established expression. 7 Cf. JL v. Ericsson, NJA 2007 s. 841. 8International Commercial Arbitration in Sweden Hobér, 4.87 and footnote 64, Lindskog, Skiljeförfarande — En kommentar (Zeteo) II-16§-2.3. 9 A summary in English is included in the report. 10 See the Government’s proposal (Sw. Lagrådsremiss) En modernisering av lagen om skiljeförfarande, dated March 1, 2018. 11 See the Government Official Report SOU 2015:37 Översyn av lagen om skiljeförfarande, p. 61. 12 See the Government’s proposal En modernisering av lagen om skiljeförfarande, p. 30. 13 See the Government’s proposal En modernisering av lagen om skiljeförfarande, p. 31. 14 See the Government’s proposal En modernisering av lagen om skiljeförfarande, p. 31. See also the preparatory works to the current SAA, prop. 1998/99:35 s. 92 et seq., and section 5 below regarding this argument. 15 See the Government’s proposal En modernisering av lagen om skiljeförfarande, p. 3031. Lindskog has argued that this already applies under the current SAA, and that the district court shall in particular take into account the requests of the appointing party (see Lindskog, Skiljeförfarande — En kommentar (Zeteo) II-16§-5.1 and II-05.3.3). The reason for this, according to Lindskog, is that the balance of interest that is achieved by the ordinary appointment procedure is altered in these cases and this should be considered by the district court when it makes the appointment. Lindskog’s argument makes sense in cases where there is no apparent obstruction. Less so in other cases since the rule is intended to serve as a sanction, and therefore the purpose of the regulation is to do just that—distort the balance between the parties and thus pose a threat to the (prospective) obstructing party. 16 Lindskog, Skiljeförfarande — En kommentar (Zeteo) II-10§-5.1, Hobér, International Commercial Arbitration in Sweden 4.85. 17 It reads: “The arbitrators shall handle the dispute in an impartial, practical, and speedy manner. They shall thereupon act in accordance with the decisions of the parties insofar as there is no impediment to so doing.” 18 A third option, of course, which often happens in practice, is that the challenged arbitrator disputes the challenge but does not want to participate if he/she is considered biased, and chooses to resign before the challenge is tried (Cf. the Swedish Government Official Report SOU 2015:37 Översyn av lagen om skiljeförfarande, p. 178). This scenario falls outside the scope of the question discussed here, but raises other procedural issues discussed in section 2.2. 19Where an arbitrator fails, without valid cause, to participate in § 30 of the SAA states: “ the determination of an issue by the arbitral tribunal, such failure will not prevent the other arbitrators from ruling on the matter.” 20 Cf. also the SCC Rules that go one step further in article 21 (2). According to that article, the board of the SCC shall decide whether the tribunal shall continue the entire arbitration without the third arbitrator. 21SkiljeförfarandeEn kommentar Lindskog, — (Zeteo) II-14 §-5.2. Cf. the Swedish Arbitration Association’s opinion and proposal in the Government’s proposal En modernisering av lagen om skiljeförfarande, dated March 1, 2018, p. 31. 23 As opposed to article 13 of the Model Law according to which the appointing party can agree to the challenge, and will, according to article 15, retain its right to appoint another arbitrator. 24 See also section 5 below with references to the Government’s proposal (Sw. Lagrådsremiss) En modernisering av lagen om skiljeförfarande, dated March 1, 2018, p. 30-31. 25Översyn av lagen om skiljeförfarande Government Official Report SOU 2015:37 , p. 31, Prop. 1998/99:35 s. 92 et seq. 26 Cf. also § 14 third paragraph, which has been argued to apply where a party appoints an arbitrator that will clearly not be able to serve as arbitrator in the arbitration, thus depriving that party of its opportunity to choose its own arbitrator, Lindskog, Skiljeförfarande — En kommentar (Zeteo) II-14§-4.2. Regarding the rationale behind § 16 as a sanction, see Prop. 1998/99:35 s. 92 et seq. and SOU 2015:37 Översyn av lagen om skiljeförfarande, p. 177. 27See En modernisering av lagen om the SAA’s opinion to the Governments proposal skiljeförfarande, dated March 1, 2018, referenced on page 31 of the proposal. Lindskog has argued that this applies already under the current SAA (Lindskog, Skiljeförfarande — En kommentar (Zeteo) II-16§-4.2.1), but, as mentioned above, there is little support for this view. Further, the Government’s proposal (on p. 31) has to be understood as a rejection of this view by the legislature. 28 See Section 2.2 and 5, as well as the Government’s proposal En modernisering av lagen om skiljeförfarande, dated March 1, 2018, p. 30-31. 29 See, for example, the Swedish Government Official Report SOU 2015:37 Översyn av lagen om skiljeförfarande” p. 178, and Lindskog, Skiljeförfarande — En kommentar (Zeteo) II-16 §-3.3. 30 It reads, ”A party who, in this manner, has notified the opposing party of his choice of arbitrator may not revoke the appointment without the consent of the other party.” 31 See the preparatory works to the current SAA prop. 1998/99:35 s. 92 et seq. 32 Parties could probably be assumed to have good reason to make their appointment carefully without this rule. For criticism of this rationale, see also Lindskog, Skiljeförfarande — En kommentar (Zeteo) II-16 §-3.2 note 5 [1996]. 33 About this, see also section 2.2 above. 34Översyn av lagen As suggested in the Government Official Report SOU 2015:37 “ om skiljeförfarande,” p. 178. 35See En moderniprop. 1998/99:35 s. 42 et seq. and the Government’s proposal sering av lagen om skiljeförfarande, dated March 1, 2018, p. 1.
Hänvisas från p. 8 (s. 565)
1.This article examines three practically important, but non-regulated, issues regarding the challenge and reappointment of partyappointed arbitrators in ad-hoc arbitration under the Swedish Arbitration Act (SFS 1999:116, the “SAA”), namely: i. What is the applicable procedure for the party-appointed arbitratorss. 565
2.to follow when trying a challenge of an arbitrator that is leveled bys. 565
3.the opposite party before the chairperson has been appointed? ii. Does the appointing party immediately lose its right to nominate itss. 565
4.own arbitrator upon a challenge based on circumstances that exist-s. 565
5.ed at the time of appointment? And is the appointing power imme-s. 565
6.diately transferred to the district court (cf. § 16 of the SAA)? Ors. 565
7.does the appointing party have a right to withdraw its first choices. 565
8.and appoint another arbitrator? iii. Are the parties free to agree on how to, and who, shall appoint a re-s. 565
9.placement? Is the challenging party bound by consent given to thes. 565
10.other party to appoint its new arbitrator? Is such agreement be-s. 565
11.tween the parties binding on the court? As can be inferred from the above, the issues discussed in this article are based on the assumption that the tribunal shall consist of three arbitrators, two party-appointed arbitrators, and a third (chairperson) who is appointed by the two party-appointed arbitrators jointly. That is also the order envisaged in the SAA, and its rules are modeled after this assumption.s. 565
12.The issues discussed in this article are practically important not least because they relate to fundamental principles of arbitration, but also because they appear in practice and cause uncertainty among parties and arbitrators alike. The ongoing revision of the SAA described in section 2.2 below, including the Government’s recent proposal referred to the Council on Legislation (Sw. Lagrådet), also includes suggested amendments to the rules on replacement of arbitrators in the SAA, which further motivates a review of the issues discussed.s. 566
13.It is argued in this article that under most circumstances, the most prudent course of action for the party-appointed arbitrators is to try the challenge between the two of them, before appointing a chairperson. However, as is described below, situations can also be foreseen where it is more appropriate for the full tribunal to try the challenge after the appointment of the chairperson and the constitution of the tribunal. Consequently, it has to be considered to fall within the discretion of the arbitrators to decide on the procedure for trying an early challenge.s. 566
14.Further, it is argued that the appointing party cannot be considered to have a right under the SAA to withdraw its original choice and make a new appointment. On the contrary, it must be considered to follow from the SAA that the appointing party immediately loses its right to choose its own arbitrator upon a challenge based on circumstances that arose before the appointment. However, it is also argued that although this is currently the state of the law, a more appropriate rule would be that the appointing party has the option to agree with the challenge. That would bring the procedure into line with the UNCITRAL Model Law (the “Model Law”) and that of most other developed national arbitration laws.s. 566
15.Lastly, it is submitted that, irrespective of the procedure set out in §§ 14 and 16 of the SAA, the parties are free to agree on the procedure to replace an arbitrator. Such agreement may be reached also during the arbitration. The parties can thus agree on the procedure rather than wait for the district court to appoint a new arbitrator. If such an agreement is reached, it is argued that it becomes binding on the challenging party. If the challenging party refers the challenge to the district court in spite of such an agreement, it is submitted that the agreement shall also be binding on the court. Although it would have been preferable to introduce an explicit regulation in the SAA that allowed the parties to agree that the appointing party may revoke its choice and make a new appointment, it is submitted that this is already the state of the law.s. 566